Malaysia to Find a Hybrid Grain Corn Variety


May 25, 2023 | Agricultural Markets News

Reading time: 2 minutes

Commercial production of Corn for feed in Malaysia is negligible despite the Government incentives. Most of the Corn planted is sweet Corn for human consumption. In 2022, Malaysia’s Corn Harvested area reached 10,982 ha, and production totaled 80,414 tons. A few of the factors that limit production growth of grain Corn include a lack of biotech varieties, higher earning potential from alternative crops, and price volatility of the grain Corn market.

The Government of Malaysia (GOM) extended the acreage available for Corn farming to address the rising cost of animal feed. However, the private sector will also need to invest in grain Corn farming development for a potential project to be viable and have made no commitments so far. Without Government support, commercial grain Corn farming in Malaysia is not feasible. There is currently no Corn variety suitable to Malaysia’s weather conditions. The GOM presently does not permit using genetically engineered (GE) crops. However, research is underway to find a hybrid grain Corn variety appropriate for the Malaysian climate.

Post revises the MY 2022/23 Corn consumption estimate to 3.5 million MT. This rise incorporates average population growth and the return of Chinese tourists to the region while accounting for the onerous increase in Corn prices. Post forecasts MY 2023/24 Corn consumption to remain steady as high costs hinder sales. This increase is primarily due to an expected increase in consumption by the poultry industry, as most Corn imports go into feed for poultry production.

Chicken is popular among Malaysians for cultural and religious reasons, making Malaysia one of the largest per capita consumers of poultry in the region. Malaysia’s official statistics indicate that poultry production hovers near a self-sufficiency level. However, supplies vary throughout the year. Low levels during festive seasons, such as Ramadhan and the Chinese New Year, sometimes lead the Government to import poultry products to maintain prices.

The increase in feed prices and GOM price controls on whole-dressed chicken led the Government to introduce output subsidies for certain poultry products. The subsidy system by the GOM for poultry farmers has helped to control prices and mitigate the impact of inflation on farmers and consumers. The output subsidies mechanism ensures an acceptable level of profit margin for farmers and allows them to produce poultry products without incurring significant losses.

The program is in place through June 2023, after which the price of chicken and eggs will be floated, with the GOM intervening as necessary. Total subsidy expenditure in maintaining prices for poultry products is estimated at around USD$47.62 million. Malaysia also enacted an export ban in May of 2022 on all poultry products due to shortages caused partly by rising production costs, including high feed prices. The ban was lifted in September 2022 as supply and Corn prices stabilized.

Malaysia to Find a Hybrid Grain Corn Variety

Corn Import in Malaysia

MY 2022/23 import estimate is down by 378,000 MT from MY 2021/22 due to rising prices. Malaysia is a price-sensitive market. Post forecasts MY 2023/24 Corn imports up 100,000 MT compared to MY 2022/23. Malaysia imports over 90 percent of its Corn from Argentina, Brazil, and India. According to AgFlow data, Malaysia imported 0.4 million tons of Corn from Argentina in Jan-Apr 2023, followed by Brazil (0.34 million tons), India (26,180 tons), and the United States (1,665 tons).

Post projects that Malaysia imports of distillers dried grains with solubles (DDGS) from the United States to be at 43,000 MT in MY 2023/24. Malaysia’s actual import of DDGS in MY 2021/22 was 42,833 MT (HS Code: 230330). Malaysian imports of Corn gluten meal (CGM) from the United States are forecast to increase to 21,700 MT in MY 2023/24, compared to an estimated 21,100 MT imported in the previous MY.

Other sources: USDA

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