The recent episode of Malaysia banning fresh chicken to Singapore is looking like a misfire, a bad joke. Malaysia did not have an explosion of population but found itself short of fresh chicken all because of some hike in the price of chicken feed, I supposed. And it was like panic station, not enough fresh chicken for domestic consumption, price hike, and to the point of banning export to Singapore. Really stylo milo, sorry Singapore, we don't have enough, can't sell to you. It was like giving notice to Singapore that it was at the mercy of Malaysia, like water, not happy, turn off the tap or in this case, cut off export of chicken. Next time may stop export of durians, fruits, vegetables to Singapore. Abang besar.
The lesson on using water supply as a trump card to squeeze Singapore leading to Singapore outwitting Malaysia by finding alternative sources of water did not sink in. Singapore wang besar. Got money can buy from anywhere. There are so many willing suppliers. Now Indonesia would be most eager to fill in the void. After negotiation and quality checks on Indonesian chicken farms, the deal was inked. Indonesia would be supplying up to 1,000 tonnes of chicken meat to Singapore till the end of the year. 50 tonnes has arrived. How many chickens is that? If the supply chain and quality are up to mark, this could become a permanent feature, regular supplier, and with possibility of more tonnages and fresh chicken as well.
What this means is that whatever the Indonesians are supplying, it would be deducted from the amount coming in from Malaysia. Malaysian farmers would now have spare chickens to sell, not to Singapore. Either they find new buyers or would have to produce less chickens. In other words, if they could not sell the 1,000 tonnes, which would be carried forward into the future, the revenue would go down accordingly. No need to produce so many chickens anymore, no need to expand the chicken farms.
Abang besar syndrome may end up not too attractive to the poor farmers trying to grow their pie and productivity in the chicken farms. Wang besar is still the king. Have money, no fear of no supply of anything. Indonesia would end up the happy partner with a willing buyer come knocking at the door, and could increase production in their chicken farms without having to go hunting for buyers, no need to sweat the small stuff. This is like money falling down from the sky.
What is the moral of the story? Jangan yaya papaya. Suka, suka sell or don't sell. This is like Australia not wanting to sell wine, lobsters or seafood to China. China buy from other sources, including iron ore and coal. Live lobsters become dead lobsters. Iron ore and coal become dirt from the ground when there is no buyer.
This has never happen before. The new PM, still reeling on the notion of how to manage a country, must have fallen asleep and let his deputies or bak-shi ministers run the show of "Siapa Raja?"
ReplyDeleteIn biz, customer is king. Fucking around with your customers like they owe you a living is a sure way of losing your business.
ReplyDeleteThe international market is not protected by bumiputra rules. Once the customer is unhappy, a competitor would step in to cut you off.
Did any of the ministers ask the farmers, with majority consensus, to lay a ban of chicken export?
ReplyDeleteIf it has been done, how widespread was the consensus?
I am quite sure this asking for majority consensus was not done. Even if it was said to have been done, it must be a minority of one or two chicken farmers?
Selling to Singapore is more profitabke than to the price controlled local market for the chicken farmers
ReplyDeleteThis would lead them to increase production . Banning the exports would reduce that incentive, exacerbating the situation.
What Malaysia should have done is to limit the supply for export iso a blanket ban, and let market forces to partially decide production.
Don't know where their decision makers learn fheir economics.
The problem with Malaysia is, if you don't have muscle behind any political tainted controversial investment , especially the fanatical ones, ridiculous decisions are most likely be made.. like the Lynas, huge backing.. afraid that future FDI will be on Jeopardy, knowing very well such dirty industry should not have been allowed in the first place.. Tanah Merah incident, the selfish elites will never learn, apparently the influenctial religious group had huge share in it.
ReplyDeleteThey practice 'Mahathirnomics' lah. Don't like, just threaten to cut. Like cutting off water. Now this weapon not so useful.
ReplyDeleteSoon, chickens and other foodstuff also suffer same fate. Luckily we do not import their rice. Then we shall see. If chicken farmers over there cannot keep up with production cost because of expensive feed, soon they become smaller and smaller producers and not only export to Singapore will be affected permanently, their own domestic consumption will be affected as well. Then both have to import from Indonesia. Then it becomes who can better afford when Indonesia starts to realise the benefits of economics of price increases as well.
Yes customer is king. But 1st you need to know who is the seller, who is the customer. In this case, M'sia govt is the seller. And the M'sian population is the customer. The customer wants cheaper chickens, so the seller (M'sian govt) ensures there's lots of chickens stuck in M'sia to sell cheaply.
ReplyDeleteThe M'sian people are happy & will continue to vote the current M'sian govt.
M'sian chicken farmers & sinkies are just collateral damage.
Malaysian Government is the chicken seller, but they are not even the breeders. Where does the Malaysian Government themselves get chickens? In Putrajaya chicken farms?
ReplyDeleteHow do Malaysians themselves get cheap chickens when domestic chicken breeders shrink their production more and more. When that happens, how or where do lots of chickens come from, and got stuck in Malaysia to sell cheaply. From the sky? I only hear of raining cats and dogs, but not chickens. One outbreak of chicken flu and Malaysians themselves have to eat feathers. Even feathers also not available when that happens. Johore also has lots of water, but when the shit hits the fan, they have to buy water from Singapore. Things are not always what we see.
When Malaysian chicken farmers start 'chickening' out from rearing chickens, let us see who really are the ones suffering collateral damage. With bird flu sometimes coming unannounced and chicken farms suffering heavy losses, these days farmers are smart and started slaughtering chickens when those chickens are hardly out of their teenage days, just in case.
ReplyDeleteThe day will come when they will follow the pig farmers into the dinosaur's history. Then the culling of pigs was too much of a loss for those farmers to stay in the trade, with all the uncertainties.