Achieving Food Security for all Malaysians

Achieving Food
 Security for all
11 July 2019

 Malaysians
 Jomo Kwame Sundaram and Tan Zhai Gen
Views 4/19

 1

Khazanah Research Institute

Views 4/19 11 July 2019

Achieving Food Security for all Malaysians

This discussion paper was prepared by the following researchers at the Khazanah Research
Institute: KS Jomo and Tan Zhai Gen. The views expressed in this paper are those of the authors
alone, and do not necessarily reflect the official views of Khazanah Research Institute.

We have also benefited from feedback from Charon Mokhzani, Fatimah Mohamed Arshad and
Wan Manan Wan Muda. Dr Sarena Che Omar, Ahmad Ashraf Ahmad Shaharudin, Nazran
Zhufri Ahmad Johari and Nadia Jihad also provided helpful feedback on the penultimate drafts
before publication.

This work is available under the Creative Commons Attribution 3.0 Unported license (CC BY3.0)
http://creativecommons.org/licenses/by/3.0/. Under the Creative Commons Attribution license, you are
free to copy, distribute, transmit, and adapt this work, including for commercial purposes, under the
following attributions:

Attribution – Please cite the work as follows: Jomo Kwame Sundaram and Tan Zhai Gen. 2019.
Achieving Food Security for all Malaysians. Kuala Lumpur: Khazanah Research Institute. License:
Creative Commons Attribution CC BY 3.0.

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Achieving Food Security for all Malaysians|11 July 2019 2

CONTENTS
1. INTRODUCTION ................................................................................................................. 7
 1.1 Food Security and Food Systems .................................................................................................. 7
 1.2 Objective and Approach ............................................................................................................... 10
2. FOOD AVAILABILITY IN MALAYSIA ............................................................................... 11
 2.1 Rice and Other Cereal Products .................................................................................................. 12
 2.2 Meat and Meat Products ............................................................................................................... 15
 2.3 Fish and Aquaculture Products.................................................................................................... 20
 2.4 Eggs and Milk ................................................................................................................................. 22
 2.5 Oils ................................................................................................................................................... 24
 2.6 Sugar................................................................................................................................................. 25
 2.7 Fruits and Vegetables .................................................................................................................... 27
 2.8 Food Availability Indicators ......................................................................................................... 29
 2.9 Conclusion ...................................................................................................................................... 30
 Box 1: Food waste and losses ............................................................................................................. 30
3. FOOD ACCESSIBILTY AND AFFORDABILITY .............................................................. 31
 3.1 Physical Access ............................................................................................................................... 31
 3.2 Economic Access ........................................................................................................................... 33
 3.2.1 Food prices and affordability................................................................................................ 33
 3.2.2 International Comparisons, Import Mechanisms and Price Controls ........................... 39
 3.2.3 Income and Food Consumption.......................................................................................... 47
 3.3 Summary.......................................................................................................................................... 55
4. DEVELOPMENT OF MALAYSIAN FOOD POLICIES ................................................... 56
5. CONCLUSIONS AND POLICY RECOMMENDATIONS ................................................ 61
 Policy Recommendation 1: Reconsider Malaysia’s commitment to achieving rice self-sufficiency
 ................................................................................................................................................................. 61
 Policy Recommendation 2: Alternative policy options to strengthen national food security and
 improve farmers wellbeing .................................................................................................................. 63
 Policy Recommendation 3: Multifaceted food security policy to ensure healthy, diversified diets
 for all ...................................................................................................................................................... 63
 Policy Recommendation 4: Food safety should get much greater policy consideration ........... 64
GLOSSARY .................................................................................................................................... 68
REFERENCES .............................................................................................................................. 71

Achieving Food Security for all Malaysians|11 July 2019 3

FIGURES
Chart 1.1 Framework of Food Security ................................................................................................... 9
Chart 2.1a: Total cereal supply, 1961–2015 .......................................................................................... 12
Chart 2.1b: Cereal supply per capita per year, 1961–2015 .................................................................. 12
Chart 2.2a: Rice production, imports and exports, 1961–2015.......................................................... 13
Chart 2.3: Import volume and price of wheat commodity, 2000–2015 ........................................... 14
Chart 2.4a: Total meat supply, 1961–2015 ............................................................................................ 15
Chart 2.4b: Meat supply per capita per year, 1961–2015 .................................................................... 15
Chart 2.5a: Poultry meat production, 1961–2015 ................................................................................ 16
Chart 2.5b: Poultry consumption per capita by country, 2015 .......................................................... 16
Chart 2.6: Pork production and supply per capita, 1961–2015 .......................................................... 18
Chart 2.7: Beef production and imports, 1961–2015 .......................................................................... 19
Chart 2.8a: Fish and aquaculture production, exports and imports, 1961–2015 ............................. 20
Chart 2.8b: Top ten countries in terms of fish and aquaculture supply per capita, 2013............... 21
Chart 2.9: Egg production & supply per capita per year, 1961–2015 ............................................... 22
Chart 2.10: Milk imports, production and supply per capita per year, 1961–2015 ......................... 23
Chart 2.11: Supply of vegetable oil per capita per year, 1961–2013 .................................................. 24
Chart 2.12a: Sugar supply per capita per year, 1961–2013.................................................................. 25
Chart 2.12b: Production, imports of raw sugar, exports’ share of total supply, 1961–2013 ......... 26
Chart 2.13a: Vegetable production, import and supply per capita, 1961-2013................................ 27
Chart 2.13b: Fruits production, import and supply per capita, 1961–2013 ..................................... 27
Chart 2.14: Fruits supply, production, import and export per capita, 1961–2013 .......................... 28
Chart 2.15a: Net per capita food supply, 1961–2013 .......................................................................... 29
Chart 2.15b: Dietary energy supply per day, 1961–2013..................................................................... 29
Chart 3.1 Share of average monthly expenditure by household income group, 2016 .................... 33
Chart 3.2: Overall CPI and food CPI, 2003 - 2017 ............................................................................ 35
Chart 3.3: F&NAB, food at home, food away from home, and coffee, tea, cocoa, and non-alcoholic
beverages indices, January 2010–December 2017................................................................................ 35
Chart 3.4: Growth of median household income versus growth of F&NAB index, 2007–2016 . 36
Chart 3.5: Growth of median wages versus .......................................................................................... 36
growth of F&NAB Index, 2010–2016................................................................................................... 36
Chart 3.6: B40 mean household income and under RM3000 food CPI, 2010–2016 ..................... 37
Chart 3.7: Home food CPI weight as share of total food CPI, various ASEAN countries, 2016 39

Achieving Food Security for all Malaysians|11 July 2019 4

Chart 3.8: Companies’ shares of beef import quotas, 2015 ................................................................ 41
Chart 3.9a: Annual Malaysian milk CPI vs global dairy CPI, 1990–2017........................................ 42
Chart 3.9b: Annual Malaysian milk CPI vs Australia, New Zealand export prices index, 1990–2016
..................................................................................................................................................................... 42
Chart 3.10: Annual dairy products CPI by category, 2005-2017........................................................ 44
Chart 3.11a: Shares of food expenditure on food at home and away from home, 1973 & 2016 . 47
Chart 3.11b: Average household expenditure on food at home and fooa way from home by
household income group, 2016............................................................................................................... 47
Chart 3.11c: Shares of food expenditure on food at home and away from home by household
income group, 2016 .................................................................................................................................. 48
Chart 3.12a: Protein Supply per Capita, 2013 ....................................................................................... 50
Chart 3.12b: Average change in protein supply per capita, 1994–2013 ........................................... 50
Chart 3.13: Average retail price of chicken, beef and selected fish, 2009–2017 .............................. 50

TABLES
Table 1: Minimum monthly expenditure to purchase various ingredients for nutritious meals,
2008–2016 .................................................................................................................................................. 38
Table 2: Fixed ceiling prices of food items ........................................................................................... 45
Table 3: Selected price-controlled food items for 2017 Chinese New Year .................................... 46
Table 4: Selected price-controlled food items for 2017 Hari Raya Aidil Fitri ................................. 46
Table 5: Share of food expenditure by food item, 1994–2016........................................................... 49
Table 6: Cereals’ shares of cereals in food at home expenditure by income strata, 2016 .............. 51
Table 7: Shares of fruits and vegetables in food at home expenditure by income strata, 2016 .... 52
Table 8: Shares of animal-source foods in food at home expenditure by income strata, 2016 ..... 53
Table 9: Shares of sugar, jam, honey, chocolate and confectionery in food at home expenditure by
income strata, 2016 ................................................................................................................................... 54

Achieving Food Security for all Malaysians|11 July 2019 5

Discussion Paper

 Achieving Food Security for All Malaysians
 Jomo Kwame Sundaram and Tan Zhai Gen
 July 2019

EXECUTIVE SUMMARY

Malaysia is more food secure today by various internationally accepted criteria, compared to the
past especially the colonial period. All major foods are available in sufficient quantities to meet
market demand, which should not be equated with human needs. Production has improved for
poultry and vegetables, while rice production is supplemented by imports. Food access is no longer
an issue for most Malaysians, with better processing, transport and storage systems and
distribution arrangements, for most major food items.

However, food affordability remains an issue. In recent decades incomes generally increased with
food prices, with more people ‘eating out’, implying relatively more spending on food.
Furthermore, certain food items, such as beef and milk, have experienced apparent price
anomalies, with domestic prices not running parallel to international trends. Most major food
imports have been subject to government regulation such as APs and import permits, which have
resulted in oligopolies/oligopsonies and related price setting. Income inequality and related
spending patterns also mean that higher prices adversely impact poorer households more, as such
households spend relatively more on food. Consumption patterns also differ among households,
due to cultural and behavioural preferences besides having different means.

Concrete steps will therefore have to be taken for the country to improve food security. Below are
four policy recommendations that should be considered:
 • Reconsider Malaysia’s commitment to achieving rice self-sufficiency
 • Alternative policy options to strengthen national food security and improve farmers
 wellbeing
 • Multifaceted food security policy to ensure healthy, diversified diets for all
 • Food safety should get much greater policy consideration

The report consists of four parts. Chapter 1 introduces the idea of food security and provides
some background for this study. Chapter 2 reviews the recent availability of food, summarising
data available on food supplies in Malaysia. Chapter 3 analyses data on economic access to food.
The Conclusion in Chapter 4 suggests some priorities for reconsideration of policies in Malaysia
to ensure food security for all with some thoughts on the welfare of producers. An appendix offers
a brief primer on food security and food systems. The Glossary may be useful for those less
familiar with some terms used in this report. A list of References is also provided at the end.S

Achieving Food Security for all Malaysians|11 July 2019 6

1. INTRODUCTION

A sustainable food security and nutrition policy requires a comprehensive food policy and a unified
action plan with multi-dimensional interventions, which typically involve several different
government ministries and agencies. In Malaysia, the development of food and agriculture as well
as related policy interventions over many decades since the colonial era raises concerns about the
sustainability and adequacy of food production, and the implications for economic development,
food security and nutrition.

To be sure, Malaysia’s success in reducing poverty and hunger can be largely attributed to efforts
to raise the incomes of the poor, through both more remunerative smallholder agriculture as well
as better employment conditions in modern agriculture, industry and services following
independence, and especially during the 1970s. Despite its positive record of reducing, if not
almost eliminating hunger and poverty, Malaysia is facing new challenges in ensuring better food
safety and nutrition, as earlier and current policies and implementation have not been well
coordinated, with the other ministries and government agencies involved, let alone with the other
major stakeholders, especially food producers, suppliers and consumers.

1.1 Food Security and Food Systems
Achieving food security means ensuring that everyone in a population has access to sufficient food
to meet their dietary needs. This includes having an adequate and stable supply of affordable
healthy food. As in many other countries, food security in Malaysia has been addressed through
piecemeal interventions. Very often, standalone policy measures and plans of various government
entities are not coordinated, or worse still, run at cross purposes to one another.

The complex relations among food supply, processing, trade, governance, environment and the
food system ‘life cycle’ have often not been fully appreciated, not least because of the complexity
involved. Nevertheless, serious concerns about current food policies, practices and habits, the
sustainability of production, and their implications for food utilisation, nutrition and public health
have been growing. Meanwhile, there is a growing openness to reconsider many earlier dogmas
about food policies, including those involving food security.

Food and agriculture are both fundamental in shaping food security and nutrition, where the food
produced by farmers and fisherfolk sufficiently supply and satisfy the population. To ensure this,
a better understanding of how we get our food from agricultural activities is very important. This
includes the production, processing (including packaging), distribution, retailing and consumption1
of food. The quality and quantity of food, in turn, determines food utilisation, safety and nutrition
outcomes2. This complex web of relations is known as the food system3.

1 Ericksen (2008)
2 Jomo, Rawal and Clark (2015)
3 “A food system consists of all the elements (environment, people, inputs, processes, infrastructures, institutions,

etc.) and activities that relate to the production, processing, distribution, preparation and consumption of food, and
the outcomes of these activities, namely nutrition and health status, socio-economic growth and equity and
environmental sustainability” (HLPE, 2014).

Achieving Food Security for all Malaysians|11 July 2019 7

A sustainable food system ensures food security and nutrition by nurturing more balanced, diverse
and healthy diets. Moreover, it puts access to food and the affordability of healthy diets at the
centre of food production, distribution and consumption. Thus, through supply, demand, prices
and incomes, the food system can ensure food security and better nutrition for all.

Food systems should be used to ensure sustainable food policies. Food policy should also create
enabling conditions and a framework for national food policies to support Malaysia’s commitment
to achieving the Sustainable Development Goals, in particular:

Most Relevant Sustainable Development Goals
 Goal 2 End hunger, achieve food security and improved nutrition, and promote
 sustainable agriculture.
 Goal 3 Ensure healthy lives and promote well-being for all at all ages
 Goal 5 Achieve gender equality and empower all women and girls
 Goal 6 Ensure availability and sustainable management of water and sanitation for all
 Goal 9 Build resilient infrastructure, promote inclusive and sustainable industrialization,
 and foster innovation.
 Goal 12 Ensure sustainable consumption and production patterns
 Goal 14 Conserve and sustainably use the oceans, seas and marine resources for sustainable
 development

Food security is defined by four important factors, i.e., food availability (for consumption), physical
and economic access (by purchasing or producing food), food utilisation (for human nutrition), and
stability of food supply (in relation to sudden shocks and cycles). In short, a population has a high
level of food security when it is able to obtain sufficient food from reliably stable and adequate food
supply at affordable prices to meet its consumption needs and nutritional requirements4.

4 FAO (2006).

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Chart 0.1 Framework of Food Security

Source: Adapted from Gibson (2012)

Food security can be assessed using different criteria, as shown Chart 1.1 above. It involves
individual food security, the nutritional value of the food choices, or even underlying conditions
and issues, such as economic, environmental and demographic changes. Assessing food security
also provides an important means for addressing these issues and determining the way forward.
This report focuses the food security at the national level. A full technical definition of food security
can be found in the glossary. Some simple methods and tools are used to measure all four
dimensions of food security.

Food availability can be measured in terms of food production, imports, exports and stocks. This
should include inputs required for food production, such as animal feed, seeds, fertilisers and stored
food stocks, taking into consideration food losses in production as well as waste in consumption5.

5 Swaminathan, Pandya-Lorch and Yosef (2014)

Achieving Food Security for all Malaysians|11 July 2019 9

Physical access to food refers to whether food is feasibly purchased or cultivated where the
population resides. Although difficult, food nutrient utilisation can be estimated. Finally, the
stability of food supply is influenced by the social and physical environment, political and
economic instability. For example, war zones usually experience food instability, as violence and
threats may disrupt food supplies. Hence, ensuring food security is contingent on adequate food
supply, effective distribution, storage and processing, ease of importation and affordability.

Ensuring food security goes beyond fulfilling the need to ensure that people are not hungry or
better, able to access nutritious food. Hunger and malnutrition ultimately result in poor physical
and cognitive development, lowering productivity or ability to work well, condemning already
hungry individuals unable to earn enough to obtain adequate food. This traps individuals and
families in cycles of poverty and hunger, often unable to escape the cycle.

Historically, before the advent and growth of the international food trade, the food security of a
community was dependent on local food production. Later, local production became less crucial,
with more food storage, trade and other processes. Nevertheless, a better understanding of how
food production addresses food security challenges is important. Greater trade requires
understanding the international food system, which consists of all elements (environment, people,
inputs, processes, infrastructures, institutions, etc.) and activities relating to food production,
processing, distribution, preparation, consumption, and their consequences, including nutrition,
health, economic growth, equity and environmental sustainability6. Therefore, food security and
nutrition should ensure more balanced, diverse and healthy diets, putting the affrodability and
access to healthy diets. Food production, distribution and consumption including trade, prices and
supply will also have to be sustainable.

1.2 Objective and Approach
This report will provide a broad historical overview of food security in Malaysia, focusing on food
availability and, to a lesser extent, accessibility and affordability. Food availability is measured by
supply, stocks, prices and consumption. Overall food supply is important as ensuring food
availability is complex and typically beyond the control of the individual. Individuals can secure
sufficient needed by means of own-production or purchase. With regard to food affordability,
changes in food prices affect how affordable food consumption is. This study is constrained by
the availability of reliable and comparable data, and only provides limited observations for each
item, and some policy recommendations.

The report presents publicly available international and national data, both for food availability and
accessibility, which may be inconsistent. These include OECD-FAO Agricultural Outlook 2018–2027
database, and hence, its source of Malaysia’s data, the Agro-Food Statistics7 published every year
by the Ministry of Agriculture8. Older data since 1961 are sourced from the Food and Agriculture

6 HLPE (2014)
7 MOA (various years)
8 The Department of Statistics publishes food-related statistics in the Supply and Utilization Accounts report, with

slightly different numbers reported. Since these statistics are reported by the Ministry of Agriculture (MOA), data
from MOA is used.

Achieving Food Security for all Malaysians|11 July 2019 10

Organisation (FAO) originally sourced with data from the Malaysian Department of Statistics and
the Ministry of Agriculture and Agro-Based Industry, including its antecedents. Other data are
sourced from Department of Statistics, Malaysia, including Consumer Price Index and it’s
Household Income and Expenditure Surveys.

2. FOOD AVAILABILITY IN MALAYSIA

This chapter anchors consideration of food availability in the country in relation to total food
supply and food supply per capita of various major food categories, i.e., total food available9 in the
country and the average amount available per person. Total food supply is calculated by adding
food produced locally to imported food, and subtracting what is exported and wasted, taking
changes in food stored into consideration. In short, total food supply is the food available in the
country for consumption. While total food supply indicates the total amount of food available for
consumption in the country, food supply per capita is the average available per person.

A broad overview of production, imports and exports of different food categories is also
considered. While local production undoubtedly contributes to food availability within the
country, imported goods may be cheaper, thus improving economic affordability and hence,
economic access. The food categories reviewed include cereals, meat, fish and aquaculture
products, eggs, milk, oils, sugar, fruits and vegetables.

For the period from 1990 to 2015, this review leans heavily on data from the OECD-FAO
Agricultural Outlook 2018–2027 database, and hence, its source of Malaysian data, the Agro-Food
Statistics10 published every year by the Ministry of Agriculture11. The data is supplemented by older
data since 1961 from the Food and Agriculture Organisation (FAO) originally sourced with data
from the Malaysian Department of Statistics and the Ministry of Agriculture and Agro-Based
Industry, including its antecedents. The only exception are vegetables and fruits; data from 1961
to 2002 are taken from the FAO database, while data from 2003 are taken from the official Agro-
Food Statistics. Annual supply per capita is calculated by dividing annual food supply 12 by the
population of Malaysia as estimated by the Department of Statistics Malaysia. As there are millions
of undocumented foreign workers and some family members, the denominator should probably
be higher, suggesting that our food supply per capita numbers are probably overestimated.
However, although they generally have lower incomes and less means to buy food, their rice
consumption may well be higher than the average for Malaysians as they are generally more likely
to be involved in manual labour, requiring more dietary energy13.

9 Food here includes both raw/primary food and processed food.
10 MOA (various years)
11 The Department of Statistics publishes food-related statistics in the Supply and Utilization Accounts report, with

slightly different numbers reported. Since these statistics are reported by the Ministry of Agriculture (MOA), data
from MOA is used.
12 Food supply per year is equated with annual consumption as reported in the Agro-Food Statistics report.
13 According to OECD data, Indonesians and Bangladeshis consume ~135 kg ~180kg of rice per capita annually

respectively compared to the Malaysians average of ~80kg.

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2.1 Rice and Other Cereal Products
Cereals remain the most consumed foodstuff, unsurprisingly accounting for the highest supply of
all food categories in Malaysia, with rice and wheat topping the list. Total supply of cereal increased
from 1.3 million tonnes in 1961 to 3.7 million tonnes in 2015 (Chart 2.1a). Rice is still the main
cereal and staple consumed; however, as shown in Chart 2.1b, annual rice supply per capita has
fallen by a third since 1961 from 121 kg per person to 86.5 kg per person.

 Chart 0.1a: Total cereal supply, 1961–2015 Chart 0.1b: Cereal supply per capita per year,
 1961–2015

 Source: OECD-FAO, FAO (various years) Source: OECD-FAO, FAO (various years), World Bank
 (various years)

Wheat accounts for about a third of total cereal supply in the country in 2015, and is the second
most important cereal consumed. Wheat and wheat products supply have increased nearly fourfold
from 1961 to 2015 (Chart 2.1a), leading to a slightly higher per capita supply from 27.4 kg per
person in 1961 to 31.1 kg per person in 2015 (Chart 2.1b). Recent research shows that this is due
to significant changes in cereal consumption, with the shift in consumption to wheat products,
even though rice is cheaper than wheat or other cereal substitutes. With increasing household
incomes, there has been a shift in consumption over time as more affluent Malaysians opt for
wheat and wheat-based products, such as noodles, bread and pasta, instead of rice, to meet dietary
energy needs14. This issue will be further explored in Chapter 3. Besides the apparent transition in
consumption of dietary energy, lower overall rice plus wheat consumption per head probably also
reflects the transition from manual to other less energetic work requiring less calories or joules.
This also coincides with the larger trend of an increasing wheat-meat-oil-fat-sugar based diet – a
more Western diet which includes more bread and proteins – away from traditional diets.

14 Mad Nasir, et al. (2010); Soon and Tee (2014)

Achieving Food Security for all Malaysians|11 July 2019 12

Chart 0.2a: Rice production, imports and exports, 1961–2015

 Source: OECD-FAO, FAO (various years)

Focusing on the production, imports and exports, rice is the major cereal produced in the country.
Production has increased threefold since 1961, from approximately 0.7 million tonnes in 1961 to
2.1 million tonnes in 2015, while rice imports have increased from 0.4 million tonnes in 1961 to
1.2 million tonnes in 2015 (Chart 2.2a). However, as noted previously, the increase in rice supply
has not kept up with population increase, reducing per capita rice supply in the country (Chart
2.1b). Malaysia is not fully self-sufficient, producing about 70 per cent of total supply according to
official data15, despite various policies to increase rice production to fulfill the food requirements
of Malaysians, as will be discussed in Chapter 4.

The importance of rice in the Malaysian diet cannot be overstated. Besides its cultural importance
for all major ethnic groups, palatability and ease of preparation, rice is easily available and accessible
as its production is highly subsidised and supply is assured by lucrative import permit awarded to
a single entity, BERNAS. However, the income from this permit were used to fund the social role
BERNAS plays, leading to net losses in recent years16. About 97.5 per cent of the population
consumed around 2.5 plates17 of rice daily in 200218, with this decreasing to 89.8 per cent in 201419.
The mean per capita daily intake appeared to increase slightly from 289.9g per day to 297.91g per
day, i.e., from 106 kg per year to 109 kg per year. Supply, as shown in Chart 2.1b appears to be
lower than consumption. As consumption data relies on individuals recalling food intake, this may
not be accurate, but rice smuggling and underestimation of the number of consumers – due to the
considerable presence of undocumented foreign workers in Malaysia – may also account for the
discrepancies. If consumption indeed outstrips supply, this could be due to eating into the existing

15 MOA (various years). Unofficial estimates of Malaysian rice output’s share of rice consumption has gone below
half, to around 45 per cent.
16 KRI (2019)
17 A plate of rice is deemed to be equivalent to 120g of rice.
18 MOH (2003)
19 MOH (2014)

Achieving Food Security for all Malaysians|11 July 2019 13

stockpiles of rice, or adjustments to the stockpiles, or problems of reporting or measurement, e.g.
due to rice smuggling.

 Chart 2.3: Import volume and price of wheat commodity, 2000–2015
 A

 Source: OECD-FAO (various years), modified from Jacks (2018)

Wheat cannot be grown locally, and is mainly imported from Australia. Wheat is milled in Malaysia
to produce wheat flour for consumption, with small amounts exported to neighbours in the region.
Wheat imports fell from 2004 to 2008 as international prices spiked, before increasing again since
(Chart 2.3). This decline coincided with the global food price crisis, when Malaysia was subjected
to cereal price spikes due to various factors20.

20Discussion of the factors behind this price spike is beyond the scope of this report. For further analysis, see, for
example, Headey and Fan (2010), Abott, Hurt and Tyner (2008), UN (2011), FAO (2011), Wiggins, Keats and
Compton (2010)

Achieving Food Security for all Malaysians|11 July 2019 14

2.2 Meat and Meat Products

Chart 2.4a: Total meat supply, 1961–2015 Chart 2.4b: Meat supply per capita per year, 1961–
 2015

Source: OECD-FAO, FAO (various years) Source: OECD-FAO, FAO (various years)

Meat and meat products supply from livestock and poultry in general increased by around 1.8
million tonnes from 1961 to 2015 (Chart 2.4a). To note, meat here does not include seafood
products such as fish but includes poultry, pork, beef and mutton, both raw and processed. These
are the main sources of poultry and livestock animal protein in Malaysia, with poultry meat the
largest source by far.

Achieving Food Security for all Malaysians|11 July 2019 15

Chart 2.5a: Poultry meat production, 1961–2015

Source: OECD-FAO, FAO (various years)

Poultry meat supply increased from 30 thousand tonnes in 1961 to 1.4 million tonnes in 2015
(Chart 2.5a), increasing from 27.8 per cent of all meat and meat products in 1961 to nearly 73.3
per cent of all meat and meat products in 2015. This is equivalent to an increase from 3.5 kg per
capita to 41.6 kg per capita, a nearly 12-fold increase. Malaysians are now one of the highest poultry
consumers in the world, surpassing many other ASEAN and Asian countries (Chart 2.5b).

Chart 2.5b: Poultry consumption per capita by country, 2015

Source: OECD

Achieving Food Security for all Malaysians|11 July 2019 16

This is remarkable when compared to changes for other poultry and livestock meat. Pork meat
supply per capita21 increased from 16.6 kg in 1961 to 36.0 kg in 1995, before falling to 18.6 kg in
1999 due to structural changes in the industry due to the Nipah virus outbreak. Supply per capita
recovered to 20.3 kg in 2015. Beef supply per capita also increased, from 2.2 kg per capita to 5.4
kg per capita, a 2.4 fold increase (Chart 2.4b). Poultry has become the main source of animal
protein as it is cheaper and consumed by all ethnic communities, as discussed in the next chapter.
Mutton and goat meat are mostly imported, with total supply per capita increasing from 0.4 kg per
capita in 1961 to 1.0 kg per capita in 2015.

Focusing on poultry meat, Chart 2.5a shows a significant increase in total production of poultry
meat, from 29 thousand tonnes in 1961 to 1.4 million tonnes in 2015, a nearly 50-fold increase.
Malaysia imported negligible amounts of poultry products, while exports increased from 2,000
tonnes in 1988 to 31,000 tonnes in 201522. Malaysia has long been fully self-sufficient in poultry,
increasing from 107.7 per cent in 2003 to 136.4 per cent in 201423. The poultry industry has grown
significantly in the last three decades due to better breeds, lower mortality and good financial
returns24. There has also been a significant shift from small-scale to large breeders, who integrate
the whole chicken supply chain from chick rearing to broiler preparation, a reason for the rapid
increase in production productivity25.

One major constraint to poultry production is dependence on imported maize and soybean for
chicken feed, with the vast majority of cornfeed imported from Argentina and Brazil (up to 93 per
cent in 2015/2016)26 while soyfeed is mainly from the US27. Globally, excessive antibiotic use on
farm animals, including chickens, ostensibly to increase productivity, is on the cusp of triggering a
global antibiotics (anti-microbial) resistance crisis.

21 We assume that only 40 percent of the population consumes pork.
22 FAO (various years), DOS (various years)
23 MOA (various years)
24 Mohamed (2007)
25 Nor and Mohamad (2015), Mohd Syauqi, et al (2015), Nazim Baluch, et al (2017)
26 Abdul Ghani (2017)
27 Abdul Ghani (2017)

Achieving Food Security for all Malaysians|11 July 2019 17

Chart 2.6: Pork production and supply per capita, 1961–2015

Source: OECD-FAO, FAO (various years)

Pork is the second major source of livestock animal protein. Pork production is much higher than
beef and mutton combined, increasing from 60 thousand tons in 1961 to 318,000 tonnes in 1998,
a 5 fold increase in production, before collapsing to 171,000 tonnes in 1999 (Chart 2.6). Production
has since increased to 230,000 tons in 2015. Per capita pork supply28 increased from 16.6 kg per
capita in 1961 to 20.3 kg per capita in 2015. Similarly, pork supply per capita was 30.2 kg per
person in 1998 before falling to 18.8 kg per capita in 1999. The self-sufficiency level decreased
from 99.3 per cent in 2003 to 89.2 per cent in 2014, with production unable to keep up with
consumption29.

The drop in production at the end of the last century was due to the Nipah virus outbreak of
1998–1999, when a large number of pigs were culled to prevent the spread of the virus. Since the
fall, the level of pork production has not returned to the level before the outbreak. Supply per
capita within the country has also fallen as lost production has not been replaced by the negligible
increase in imported pork.

The pork industry is highly regulated and nearly all pig farms are licensed, unlike other livestock
industries30. Changes in regulation and policies have affected the growth of the industry more than
with other livestock. The closure and partial relocation of unregulated pig farms to designated
areas as well as new zoning restrictions for pig production resulted in drops of pork production,
although they were officially described as short to medium term measures. The industry is also

28 The population share consuming pork is assumed to be 40 per cent of the total Malaysian population.
29 MOA (various years)
30 EPU (2015)

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dependent on imported feed. These factors help explain fluctuations in production and import
trends, and the fall in production levels.

Chart 2.7: Beef production and imports, 1961–2015

Source: OECD-FAO, FAO (various years)

The rise in total beef supply in the country is due to the great increase in beef imports. Production
of beef has stayed relatively constant since 1961, increasing only from 15 thousand tonnes in 1961
to 19 thousand tonnes in 2015. Instead, imports went up 58 fold from 4 thousand tonnes in 1961
to 232 thousand tonnes in 2015 (Chart 2.7), with both frozen and fresh/chilled beef mainly
imported from India and Australia31. Local beef increased from 18.5 per cent in 2003 to 28.6 per
cent in 2014, with almost three-quarters of the beef available in the country imported.

Since the 1970s, Malaysia has attempted to increase beef production by introducing and cross-
breeding higher yielding breeds and establishing large scale cattle farms32. While production has
increased, the self-sufficiency level still hovers below 30 per cent, despite the third National
Agricultural Plan, 1998-2010 aiming to achieve 30 per cent self-sufficiency33. Nearly 90 per cent of
all beef from Malaysia is from small farms, limited by expensive imported feed, unavailability of
appropriate breeds and breeders, low profit margins and competition from cheaper imported
beef34. Various government projects, such as Majuternak and the National Livestock Development
Authority, and joint-ventures have yet to achieve the targeted rise in production35. Hence, the 11th
Malaysia Plan for 2016-2020 planned to increase beef self-sufficiency to 50 per cent by 2020,

31 KRI (2016)
32 MOA (2013)
33 Zainal Abidin (2007); Zainal Abidin, Hosseini and Nitty Hirawaty (2013)
34 Ibragimov, et al. (2016)
35 Mohamed, Sharifah and Hafidz (2015)

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including efforts to graze cattle in Malaysia’s vast oil palm plantations and by promoting better
breeds36. Although mutton production and consumption is small, the Department of Veterinary
Services is also driving efforts to build the mutton and goat meat industry by introducing more
productive breeds, providing fertile goats to start new herds, and providing more and better
technical support37.

2.3 Fish and Aquaculture Products
Fish and aquaculture products are another important source of animal protein. Total supply of
fish and aquaculture products increased from 20.5 kg per capita yearly in 1961 to 57.5 kg in 2015,
a nearly three fold increase (Chart 2.8a). However, after supply per capita peaked at 62.8 kg per
capita in 2000, supply has been volatile, decreasing to 57.5 kg per person in 2015. This indicates
that fish and aquaculture products in 2015 are the most available animal protein source, followed
by chicken.

These products, including those from marine and freshwater fishing as well as aquaculture, have
increased 10-fold from 168 thousand tonnes in 1961 to 1.7 million tonnes in 2015 (Chart 2.8a).
Imports have also increased, from 53 thousand tonnes in 1961 to 567 thousand tonnes in 2015,
an 11-fold increase. This shows that unlike the increased local production of chicken, demand for
fish and aquaculture products has been met by increasing both production and importation.

Chart 2.8a: Fish and aquaculture production, exports and imports, 1961–2015

Source: OECD-FAO, FAO (various years)

36 Ibragimov, et al. (2016)
37 MOA (2013)

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Malaysians have the largest daily per capita intake of fish and aquatic food among ASEAN
countries, among the highest in the world (Chart 2.8b). This is shared across different segments
of society, with 78 per cent of the population consuming fish at least twice weekly38. Other studies
show that average per capita consumption are likely to have increased further from 201439. The
high consumption of fish and aquaculture products is not surprising, given Malaysia’s long
coastlines and many water bodies. Nevertheless, the increased consumption has put pressure on
the carrying capacity of the existing capture fisheries industry, requiring increased imports.

Chart 2.8b: Top ten countries in terms of fish and aquaculture supply per capita, 2013

Source: FAO
Note: This is ranked by countries with available data

38 Nurul Izzah, et al. (2016)
39 Aruna (2014)

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2.4 Eggs and Milk
Chart 2.9: Egg production & supply per capita per year, 1961–2015

Source: OECD-FAO, FAO (various years)

Eggs40 are another major source of animal protein. The amount of eggs available per capita also
increased from 2 kg per person in 1961 to 25 kg per person in 2015, increasing more than ten fold
(Chart 2.9). However, this was preceded by falling supply per capita from 13.1 kg in 1992 to 9.7
kg in 2002, before increasing again.

Production of eggs increased from 13 thousand tonnes in 1961 to 776 thousand tonnes in 2015,
rising nearly 60 fold. Meanwhile, exports have increased from a thousand tonnes in 1961 to 106
thousand tonnes in 2015 while imports have been negligible throughout. The sharp increase in
exports since the mid-1990s lowered supply per capita, before increasing again since 2002.

40 Eggs includes chicken and ducks’ eggs.

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Chart 2.10: Milk imports, production and supply per capita per year, 1961–2015

Source: OECD-FAO, FAO (various years)

Malaysia’s milk supply per capita increased from 29.7 kg per capita in 1961 to 59.8 kg per capita in
1995. This quickly fell to 23.6 kg per capita in 2008, before rising again to 34.9 kg per capita in
2015. However, such dramatic changes raises questions about data reliability. As Malaysia is a net
importer of milk41, changes in per capita supply have been very much affected by imports which
increased from 226 thousand tonnes in 1961 to 1.57 million tonnes in 2015 (Chart 2.10), a nearly
7-fold increase. Falling milk supply per capita coincided with falling imports, with supply sensitive
to global trends.

Since the 1970s, the Malaysian authorities have attempted to raise domestic milk production, e.g.,
by setting up milk collection centres and processing plants. Other than the Malaysian climate not
being conducive to the major milk cow breeds, high feed costs, poor farm management skills as
well as low-yielding cattle and goat breeds have impeded development42. Local milk production in
recent decades has been poor, with local output only around 5 per cent of all milk supply in 2015,
down from 13.1 per cent in 1961. This low share of total supply and consumption does not allow
local milk to replace import shortfalls. However, milk production may be inherently costly in
Malaysia due to the climate and natural limitations; thus, importing milk may still be comparatively
less costly to ensure adequate and affordable supply for the country.

There has also been some decline in milk consumption, with fresh and commercial milk
consumption falling from 36 g/day in 2003 to 32 g/day in 2014. Powdered milk consumption has
also dropped, from 11.6 g/day in 2003 to 2.83 g/day in 201443. Declining supply per capita after

41 Milk includes fresh milk, reconstituted milk and milk powder.
42 Another issue may be the abuse of legal loopholes, such as the vague definition of ‘fresh’ milk in the 1985 Food
Regulations to include reconstituted milk powder.
43 MOH (2003; 2014)

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2008 may be due to lower consumer demand for milk, but lower demand may not be enough to
explain the sharp drop in milk supply per capita.

2.5 Oils
Palm oil is the main vegetable cooking oil used in Malaysia, followed by soya oil and sunflower oil.
Supply per capita increased from 7.5 kg in 1961 to 20.3 kg in 1986, before falling to 12.6 kg in
1996 and then rising again to 16.6 kg in 2013 (Chart 2.11). While the rapid increase after the 1960s
may be due to rising incomes and food consumption 44, it also coincides with the agricultural
transition in Malaysia from rubber to oil palm. Also, the seemingly large amount of cooking oil
per capita may also be due to palm oil being used to make other products, especially processed
foods.

Chart 2.11: Supply of vegetable oil per capita per year, 1961–2013

Source: FAO (various years)

As a major producing country, palm oil has long been the preferred edible vegetable oil due to its
relatively low price. The government had removed most subsidies for palm-oil based cooking oil
by January 2017, but data on cooking oil post-2013 are not available. However, the Ministry of
Domestic Trade, Cooperatives and Consumerism reported in 2016 that average per capita
consumption of palm oil was 1.5 kg monthly, equivalent to 18 kg of oil a year.45

Despite being a major producer and exporter of palm oil, one recurring issue has been periodic
cooking oil shortages, especially before festive occasions. This has been blamed on various factors
including smuggling, hoarding by retailers and high consumer consumption, leading the Ministry

44 Yusof and Chan (2004)
45 Ooi (2016)

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of Domestic Trade, Cooperatives and Consumerism to limit palm oil purchases during such
seasons46.

2.6 Sugar
Chart 2.12a: Sugar supply per capita per year, 1961–2013

Source: FAO (various years)

Annual sugar supply per capita to Malaysians rose from 30 kg in 1961 to 43 kg in 2013, among the
highest in Asia (Chart 2.12a). Malaysia is a net sugar importing country, locally refining imported
raw sugar to meet the rising demand for sugar. Total sugar imports increased from 253 thousand
tonnes in 1961 to 1.9 million tonnes in 2013 (Figure 2.12b). The rapid rise in sugar supply and
consumption has been paralleled by increased diabetes incidence, which rose from 11.6 per cent
of adults in 2006 to 17.5 per cent in 201547.

46 Choong (2016); Mahamad Rodzi (2007); The Borneo Post (2017)
47 IPH (2006; 2015)

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Chart 2.12b: Production, imports of raw sugar, exports’ share of total supply, 1961–2013

Source: FAO (various years)

Part of the sugar imported is re-exported by Malaysia in various forms; the proportion of sugar
exported in relation to all sugar produced in and imported into the country (i.e., before re-
exporting) increased from 0.3 per cent in 1961 to 25 per cent in 2013, the last year for which data
are available. (Sugar is measured in terms of its raw, unprocessed sugar equivalent.)

Growing preference for sweet food and beverages accompanying population and income growth
account for much of the increased sugar consumption. The country has seen strong growth in
food processing, with Malaysia a major producer of and self-sufficient in sweetened ‘condensed
milk’, which typically has a higher proportion of sugar by weight compared to milk 48. Increased
consumption of sweetened condensed milk, soft drinks, ice cream, chocolates, candy and other
sweetened items have contributed to the additional demand for sugar.

48 Sim and Chubashini (2015)

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2.7 Fruits and Vegetables
Chart 2.13a: Vegetable production, import and supply per capita, 1961-2013

Source: FAO, MOA (various years)

Fruits and vegetables are important sources of dietary fibre and a wide range of vital
micronutrients. Supply per capita of vegetables increased from 20 kg in 1961 to 72 kg in 2013.
This has been more due to increased importation of vegetables rather than greater production.
Production of vegetables increased ten fold from 134 thousand tonnes in 1961 to 1.4 million
tonnes in 2013 (Chart 2.13a). The amount of vegetables imported rose 14 fold, from 79,000 tonnes
in 1961 to 1.1 million tonnes in 2013. This means that for every tonne of vegetables produced in
1961, 0.59 tonnes of vegetables were imported. This ratio decreased to 0.27 tonnes of vegetables
imported for every tonnes produced in 1972, before increasing to 1.95 tonnes of vegetables
imported for every tonnes produced in 2008, i.e., more vegetables were imported than produced.
This has since decreased to 0.82 tonnes of vegetables imported per tonnes produced in 2013.

Chart 2.13b: Fruits production, import and supply per capita, 1961–2013

Source: FAO, MOA (various years)

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However, the supply of fruits has not improved significantly. Supply per capita increased from
69.0 kg in 1961 to 71.6 kg in 2013. Supply per capita has remained stagnant due to slow output
growth with ever increasing import shares. Production increased from 663 thousand tonnes in
1961 to 1.5 million tonnes in 2013, by almost 2.3 fold (Chart 2.13b). Meanwhile, annual imports
increased from 42 thousand tonnes to 863 thousand tonnes, by 20-fold.

Chart 2.14: Fruits supply, production, import and export per capita, 1961–2013

Source: FAO, MOA (various years)

Chart 2.14 shows the fruits supply, production, import and export per capita. The stagnation in
supply per capita is due to the falling production per capita being substituted by the increasing
import per capita, while export per capita reduced slightly. In other words, production in the
country could not keep up with the demand from the population, thus imports are required to
maintain the supply in the country.

There are several factors constraining raising outputs of fruits and vegetables. Prohibitive
production costs, compounded by high production risks, have constrained expansion of fruit and
vegetable production. For fruits, in particular, mismatched climatic and horticultural conditions
for particular fruits and high production costs have worsened yield gaps between potential and
(average) actual yields for various fruits 49 . Limited shelf-life, poor packaging, storage and
transportation facilities, as well as price volatility and seasonality affect the supply and marketing
of fruits and vegetables50.

49 Mohd Desa, personal communication.
50 Jomo, Rawal and Clark (2015)

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2.8 Food Availability Indicators
With increased supply of most food items, the total amount of food available to Malaysians has
indeed increased. Chart 2.15a shows total and per capita food supply measures since 1961. Food
supply has increased 4.8-fold compared to 1961, while per capita food supply increased 1.4 fold.

Chart 2.15a: Net per capita food supply, 1961–2013 Chart 2.15b: Dietary energy supply
 per day, 1961–2013

Source: FAO (various years) Source: FAO (various years)

Daily dietary energy supply available measures the amount available from food, as shown in Chart
2.15b. Dietary energy supply per day has increased from 4835 kJ per person in 1961 to 5830 kJ
per person in 201351. This modest 1.2-fold increase is more than the recommended dietary energy
requirements at different life stages, with the highest being for highly active adolescent males
estimated at 2930 kJ per person52.

51 The average daily dietary energy supply assumes that every person has the same access to food, and does not take
into account consumption wastage and that all foods are homogenous without considering their nutrient content, e.g.,
micro-nutrients.
52 MOH (2017)

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2.9 Conclusion
The increases in food supply in the country since 1961 has provided more than sufficient dietary
energy for every person in the country. Total and per capita food supply have increased greatly for
many major food categories other than milk. This means that Malaysians today have more food
available to them from local production and imports compared to 1961. Local production of some
foods has increased significantly, while imports have also increased to supply food required in the
country. Hence, Malaysia does not seem to have issues with food availability.

However, the existence of certain food monopsonies/monopolies and oligopsonies/oligopolies
in local production as well as for food imports gives cause for concern, as the market powers they
enjoy limits the supply and affordability of certain foods and ensures rentier market power for
those so privileged53. Also, food availabilty does not ensure affordable access for all Malaysians.

Box 1: Food waste and losses

Harvest and post-harvest food losses during production, and waste associated with consumption
are important considerations in ensuring food security. Statistics on food waste and losses have
been crippled by poor accuracy, uniformity and timeliness. Reported statistics on food waste and
losses differ widely; until recently, there was no well-defined, standardised method to measure
food waste and losses.

Recent estimates suggest that approximately 15,000 metric tonnes of food is wasted daily in
Malaysia: 8,000 tonnes consist of food leftovers, of which about 3,000 tonnes–or a fifth–is edible
and can feed 2.2 million people with three meals a day. This averages around RM2700 worth of
food being wasted per urban resident yearly54.

Wastage in farms and food processing plants are also staggering. Rice production losses are up to
28.5 per cent (around 700,000 tonnes yearly): 9 per cent during harvesting, 9.5 per cent during
milling and drying, 6 per cent during transportation and 4 per cent during storage. For fruits and
vegetables, post-harvest losses and waste are estimated to vary between 20 to 50 per cent (around
600,000 to 1.5 million tonnes yearly): 10 to 20 per cent during harvesting, 5 to 10 per cent during
field handling, 2 to 20 per cent during post-harvest handling, 5 to 15 per cent during distribution,
and 3 to 20 per cent during consumption55. Inadequate knowledge about post-harvest processes
and poor knowledge of post-harvest handling techniques may explain the high level of food losses.

MARDI and FAO have joined forces to form the MYSaveFood Network to reduce food loss and
waste in Malaysia56. This is complemented by the Food Loss and Waste Standards by the FAO to
measure and estimate as well as to provide standards to minimise such loss and waste.

53 This will be elaborated in the following chapter.
54 Albakri (2016)
55 The Star Malaysia (2016)
56 The Star Malaysia (2016)

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