Malaysia vegetable farmers in a pickle over diesel subsidy cuts, mull abandoning crops

The warning by an industry group comes as the government’s removal of blanket diesel subsidies continues to spark public anger

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A vegetable stall at a night market in Malaysia. Photo: Shutterstock

Published: 4:42pm, 23 Jul 2024Updated: 4:53pm, 23 Jul 2024

Hundreds of vegetable farms in Malaysia may end up abandoning their crops for other more lucrative options, an industry group warns, as farmers struggle to keep up with soaring costs following the government’s removal of blanket diesel subsidies.

Prime Minister Anwar Ibrahim’s administration has been facing growing public anger over stubbornly high living costs even as the government seeks ways to slash its costly annual subsidy bill. After the subsidy scheme’s revamp, diesel pump prices surged by 50 per cent last month.

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.”

Protesters hold placards outside Malaysian prime minister’s official residence in Putrajaya, demanding lower diesel prices. Photo: EPA-EFE

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.