KUALA LUMPUR – Concerns over rice supply shortages and industry monopoly can be averted if Padiberas Nasional Bhd (Bernas) fulfils 10 obligations following the government’s move to extend its concession for the distribution of the staple food until 2031.
Muda Agriculture Development Authority (Mada) chairman Datuk Ismail Salleh said that Bernas has yet to fulfil these obligations, leading to a crisis that includes a shortage of local white rice and legitimate rice seeds.
In addition to corporate social responsibility (CSR) commitments to rice farmers, Bernas must ensure disaster relief, maintain a stockpile of rice and padi seeds, and implement a more comprehensive industry system, he said.
“Efforts were made by (Prime Minister) Datuk Seri Anwar Ibrahim to meet with (Bernas majority shareholder) Tan Sri Syed Mokhtar Al-Bukhary to request a CSR commitment of RM10 million and RM50 million from Bernas, for 30% of the profit – that is one of the commitments (obligations).
“If Bernas streamlines all these commitments, it can play a pivotal role as a private entity closely aligned with the government thus ensuring the rice padi industry is properly maintained. This could mitigate concerns about monopoly.”
Ismail explained that the monopoly issue surfaced amidst a food security crisis, particularly in terms of the shortage in supply of local rice.
“People label this as a monopoly, signifying that Bernas, by obtaining an AP (approved permit) to import, becomes a ‘single gatekeeper’ with exclusive rights,” he said.
“With imported rice currently priced at RM32 or RM3.20 per kg, compare this to supermarket prices – which are significantly higher at RM45, RM55, or RM65.
“The public is angered by a high-profit margin that fails to fulfil the mentioned commitments,” Salleh said.
Previously, the government extended Bernas’ rice distribution concession for another 10 years, imposing an increase in its social obligations from five to 10.
Ismail stressed the urgency for Bernas to expedite the fulfilment of all obligations, indicating that changes may be necessary if compliance is not achieved.
“With the substantial dividends earned by a single entity holding the rice import rights, Bernas has a duty to provide assistance,” he said.
“While changes can only be made after the concession ends in 10 years, compliance with all commitments is essential. If not, changes must be considered, given that the memorandum of understanding is already in place,” Ismail concluded.
Over the last three financial years (FY2020 to FY2022), Bernas paid dividends totaling RM996.22 million to its shareholders, primarily Tradewinds Group (M) Sdn Bhd controlled by Syed Mokhtar. – December 7, 2023