RM600m allocated for Cooking Oil Stabilisation Scheme

by NUR HANANI AZMAN / pic by BERNAMA

THE Domestic Trade and Consumer Affairs Ministry (KPDNHEP) and the Finance Ministry have allocated RM600 million this year compared to last year’s RM528 million for the Cooking Oil Stabilisation Scheme (COSS).

KPDNHEP Minister Datuk Seri Alexander Nanta Linggi said his ministry is in discussions with several other ministries and agencies related to improving the price implementation mechanism for subsidised and non-subsidised cooking oil in the market to reduce consumers’ burden.

“The government will inform the outcome of the discussions and the agreed mechanism,” Nanta Linggi said in a statement.

COSS is a cooking oil subsidy programme aimed at alleviating consumers’ cost of living, applicable to all groups.

Nanta Linggi said the subsidy is given to 1kg cooking oil packed in polybags and offered to consumers at RM2.50 per packet despite the price of crude palm oil (CPO) at the world market currently increasing.

“The government has allocated 60,000 metric tonnes (MT) per month (or 720,000MT per year) which is equivalent to 60 million polybags per month (720 million polybags per year) for all Malaysians.

“This is based on a consumption rate of 1.8kg per person per month (22kg per person per year),” he said, adding that the government guarantees the quality of subsidised cooking oil sold in polybags are the same as those sold in bottles, as some are manufactured at the same factory.

Meanwhile, cooking oil sold in plastic bottles and cans (2kg, 3kg, 5kg and 17kg) are not subsidised as the prices are determined by the CPO price at the world market.

“People have the choice to buy subsidised cooking oil in 1kg polybags or the unsubsidised ones in bottles and cans,” the minister said.

Currently, the CPO price in the world market has reached more than RM4,500 per MT compared to around RM2,500 per MT before, which is equivalent to approximately RM4.50 per kg before being processed and bottled.

This means that CPO’s cost alone, before packaged, is already more than RM22 for 5kg, excluding other costs such as processing, bottling, transportation and profits at all levels of factories, wholesalers, distributors and retailers.

Nanta Linggi said KPDNHEP enforcement is consistently monitoring the supply and price of goods in the market.

“The enforcement will not hesitate to take action under the Price Control and Anti-Monitoring Act 2011 if it finds traders who are profiteering on the price of goods, including cooking oil,” he said.

KPDNHEP will exercise its powers such as enforcing controlled prices or ceiling prices.

The Festive Season Maximum Price Scheme is one example where the ministry enforced price controls for each festive season, where KPDNHEP anticipates increased demands in various food items.