Malaysia vegetable farmers in a pickle over diesel subsidy cuts, mull exit or crop switch

The Malaysian Federation of Vegetable Farmers Association said at least 10 per cent of their 6,000 members nationwide were likely to change crops or even quit the trade by the end of the year if the government did not intervene to help deal with the price surge.

“Our farms use a lot of machinery to do things like irrigation to earthworks, and this uses a lot of fuel,” Lim Ser Kwee, the association’s president, told This Week in Asia.

“The prices of pesticides and fertiliser have gone up, vegetable prices are volatile and our members are also struggling to find farming land as many owners no longer want to rent out their land for agriculture. It is becoming more difficult for us.”

The government had promised to keep a lid on inflation after diesel prices surged to 3.35 ringgit per litre (71 US cents) overnight on June 10, when blanket subsidies were replaced with a targeted system aimed at curbing rampant smuggling and saving the government about 4 billion ringgit annually.

On Monday, Anwar said authorities would temporarily shelve plans to extend the subsidy scheme’s rationalisation to the widely used RON95 grade petrol.

“The government has a targeted mechanism that includes the farmers. The problem is in the implementation,” said James Chin, a Malaysia specialist with the University of Tasmania’s Asia Institute.

Malaysia had a long-running issue with poor implementation of government policies, which critics claimed was due to the incompetence of government agencies or alleged sabotage by some civil servants, Chin said.

01:21

King Sultan Ibrahim crowned in Kuala Lumpur

“I don’t know who to believe, but all we know is that the situation is creating a lot of anger … because people who are supposed to be cost-neutral by getting the