August 11, 2004



Malaysian Feed Mill Production May Decline


Malaysian feed mills may cut production in coming weeks as demand slides for the country's poultry amid bird flu scares in Asia, regional traders said.


Malaysia says it is one of the few Asian countries which has remained free of avian influenza. A suspected case last week triggered a Japanese ban on Malaysian poultry and a partial ban from Singapore. But officials said they had found no trace of the deadly virus.


Fresh cases of bird flu in Thailand, Vietnam, China and Indonesia last month showed the virus was not going to disappear quickly after sweeping across much of Asia earlier this year.


"Poultry farmers are now forced to cut production to reduce severe losses," Abdul Rahman, executive consultant to the Federation of Livestock Farmers' Associations of Malaysia, told Reuters. "This will also affect feed production."


Malaysia produces about 1.1 million live birds a day. The Southeast Asian nation's per-capita chicken consumption of about 30kg per person per year is among the world's highest.


Poultry accounts for 70% of the country's feed demand. Trade officials expect Malaysia's feed output in 2004 to fall up to 20% to 3.2 million tons from four million in 2003.


Malaysia was China's second-biggest corn customer after South Korea until last year, taking more than 90% of its annual imports of 2.4 million tons from the Asian supplier.


But this year, a sharp drop in export offers from China -- which is struggling to rein in food prices amid declining grain stocks -- has forced Malaysia to turn to Argentine corn to fill the void.