June 23, 2022
Malaysian poultry firms see shares rise
Malaysian poultry companies listed on the Bursa Malaysia stock exchange saw their share prices go up following the government's announcement that the chicken ceiling price will be scrapped from July 1, The Star reported.
Leong Hup International Bhd saw its share price increase by MYR 0.02 (~US$0.0045; MYR 1 = US$0.23) to close at MYR 0.53 (~US$0.12), QL Resources Bhd remained unchanged at MYR 5.10 (~US$1.16), Teo Seng Capital Bhd saw a MYR 0.04 (~US$0.0091) increase to MYR 0.81 (~US$0.18), and CCK Consolidated Holdings Bhd saw a MYR 0.03 (~US$0.0068) increase to MYR 0.59 (~US$0.13).
Vincent Lau, head of equity sales at Rakuten Trade, said the decision made by the government is good because it benefits the chicken supply chain, the government, and the poultry industry.
Lau said the pressure on margins for poultry-related businesses, especially smaller ones, is somewhat relieved by this, adding that since market forces will determine supply and demand, the availability of chicken should improve.
Dr Carmelo Ferlito, CEO of Centre for Market Education, said lockdowns caused the current imbalance between supply and demand in the poultry industry, and consumers must put up with temporarily high prices in order for the supply to increase in response to a rise in demand.
Datuk Seri Alexander Nanta Linggi, Malaysia's Domestic Trade and Consumer Affairs Minister, said chicken prices are projected to reach MYR 10 (~US$2.27) per kg.
Nanta said livestock farmer groups informed him that after the subsidy is removed, chicken prices will increase only slightly.
The maximum price scheme for chicken and eggs was put into effect last February 5 and was originally set to end on June 5. The government extended the deadline to June 30.
On a per-capita basis, Malaysia ranks high among the countries that consume the most chicken worldwide. Despite the removal of import permits, imports into Malaysia were still difficult due to the previous low ceiling price because chicken was more expensive in neighbouring nations.
- The Star