Earlier while I was reading the latest news on the recent rice stockpile shortage, I began to wonder how exactly did this problem come to be. After all rice is the staple diet of Asians and for a country like Malaysia to be caught unprepared in the face of global food shortages just smack of plain incompetence.
I use the word incompetence justly so in lieu of the fact that the government has the necessary mechanisms in place to monitor and be ‘in the know’ about the possibility of such an issues as the rice stockpile shortages actually coming to be. So where did things take a turn for the worse? Based on my initial research the fault lies at the feet of Padiberas Nasional Bhd (BERNAS) .
For your information BERNAS is the privatised custodian of the Malaysia paddy and rice industry. BERNAS is the sole importer of rice into Malaysia besides also being in charge of the National Rice Stockpile. In essence they are the sole importer and overseer of rice in Malaysia. Already the share market is seeing a rise in BERNAS shares as the recent increase in rice prices coupled with the presured buying trend locally – all of which has contribute to a favarouble outcome for BERNAS. Unfortunately this does not translate to being favourabel for the rakyat .
It is their position as overseer is where I definitely find fault with BERNAS for failing to be prepared for exactly such the scenario of increasing trends of rice shortages that we are now experiencing. In their ignorance BERNAS has until recently maintained only 2 WEEKS worth of rice stockpile for the entire of Malaysia. That’s right 2 weeks of rice supply before it runs out in a worse come to worse case scenario. This is why there have been recent spate of consumers in huge droves snapping up rice due to concerns that our rice stockpile can easily run out in just 2 weeks.
Looking back to just last year, when any trend forecaster worth his salt could have predicted increases in food prices in addition to the decrease in global stockpiles. Unfortunately BERNAS was more inclined to ignore the situation and instead focus on increasing the price of rice sold locally . I haven’t the precise details right now but it is known that BERNAS is importing rice at cost prices while selling it in Malaysia for a higher price, thus earning a profit.
If BERNAS wasn’t farsighted enough then at least the government to some degree were already prompting BERNAS to increase their national stockpile to cater for future trends. In reference to article(below) from The Star dated July 12 2007 , we can see that the government was already informing BERNAS to increase their stockpile:
Create a big stockpile, Muhyiddin tells Bernas
Padiberas Nasional Berhad (Bernas) has been told to create a stockpile so that the country will not be plunged into a crisis if there is an acute shortage of rice globally.
Agriculture and Agro-Based Industry Minister Tan Sri Muhyiddin Yassin said that although Bernas had a floating stock of 92,000 tonnes of rice in the local market, it could not be considered the country’s stockpile.
“We are afraid that any shortfall in global supply and increasing global demand for rice would affect us.
“And there are already early signs in the region where the demand for rice has gone up while the rice producing countries’ yield had dropped due to disease, floods and weather changes,” he said.
He was speaking to reporters after his ministry’s weekly post-Cabinet meeting here yesterday.
Muhyiddin said he was not trying to alarm the public.
“But we need to look at future trends. This is why we need to look at having an appropriate amount of rice stockpile for the country,” he added.
If that was not enough then the same call was repeated beginning this year with more emphasis being made for a 3 month rice stockpile plan to be put into place. This is highlighted in the the following article(below) from The Star dated 31 January 2008 :
Bid to up rice stockpile to three months
The Government wants Bernas to stockpile rice for three months or more to ensure there is sufficient supply for the people in the event of a shortage.
Agriculture and Agro-Based Industry Minister Tan Sri Muhyiddin Yassin said the current agreement was to have a two-week stockpile.
“We believe that two weeks is not enough, so there is a need to review to, say, three months.
“We need to have more than the stock we have at the moment to create the actual stockpile for the rice later.
Therefore in lieu of the calls made to BERNAS from the government to increase the National Rice Stockpile to a 3 month capacity has fallen on the deaf ears of BERNAS . Already 9 months has passed since the initial call had been made to BERNAS and as of yet no credible action has been taken .
Only now in light of the worsening conditions of worldwide food shortages and the recent limelight on the insufficient national rice stockpile that BERNAS has made moves to increase the stockpile. This too was partially due to pressure from the government.
So the pertinent question that we must ask ourselves is it is fair for us the rakyat/consumers that BERNAS is allowed to continue to be the sole importer of rice for our country. The lack of any competition in this sector can only be regarded as a monopoly and a possibly unfair one at that!
