Issuance of sugar APs to end national monopoly of two refineries — Chong

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KUCHING: The federal government is liberalising the supply of sugar in Sarawak to end the monopoly held by two sugar refiners, Domestic Trade and Consumer Affairs Deputy Minister Chong Chieng Jen said.

He said the move was done with the hope of reducing the cost of production in the food and beverage (F&B) manufacturing sector in the state.

Chong said two sugar refineries – MSM Malaysia Holdings Bhd and Central Sugar Refinery Sdn Bhd – had monopolised the supply of sugar in the country under the policy of the previous Barisan Nasional (BN) administration, as they were the only ones holding approved permits (AP) to import sugar.

“International sugar prices have fallen in the last few years. In fact, since 2012 (except for the 12-month period between the second half of 2016 to the first half of 2017) international sugar prices was and is still below RM1.50 per kilogramme.

“However, the (previous) BN government prohibited the importation of refined sugar to keep the two sugar refinery companies profitable.

“As a result, F&B manufacturers from Sarawak were compelled to buy sugar from these two companies at prices between RM2.40 and RM2.70 per kilogramme,” he said in a statement yesterday.

Chong said with the liberalisation policy of the Pakatan Harapan government, F&B manufacturers in Sarawak and Sabah can directly import sugar from overseas sugar refineries at around RM1.50 per kilogramme, thus reducing production costs and making them more competitive for the export market.

In allowing the importation of sugar by Sarawak F&B manufacturers, he pointed out that the ministry did not impose any condition for
these companies to lower the prices of their products and that it is at the individual company’s discretion to determine the prices of their products.

He also said that the government is leaving it to free-market forces to determine the price of sugar, with the exception of some controlled or government-subsidised items such as petrol, diesel or liquefied petroleum gas (LPG).

“This change in policy may not have an immediate effect on the price of goods, but in the long term, it will definitely benefit the consumers.

“Therefore, the ministry will continue with its liberalisation of sugar supply policy and is open to applications by any large or small F&B manufacturers in Sarawak,” he said, adding that the 11 companies who had applied for the sugar AP had received their import permits.

Depending on the sugar usage in their production line, some of them will receive more and some receive less, he added.

The ministry on Dec 6 released the names of the 11 sugar AP holders in Sarawak.

They are Sunshine Food Manufacture Co Sdn Bhd, Dahfa Foods Manufacturing Sdn Bhd, Sundrop Fruit Juices Sdn Bhd, KNG LAK (EM) Sdn Bhd, Alwi Food & Beverages Industries Sdn Bhd, Ta Yung Food Industries Sdn Bhd, Stampin Confectionery Sdn Bhd, Foodtake Industries Sdn Bhd, Kit Hin Company Sdn Bhd, F&N Sarawak and Teck Lee Seng Coffee Product.