GIEWS Country Brief: Malaysia 15-July-2020

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  1. The 2021 main paddy season started in Sabah on time, supported by favourable precipitations

  2. Aggregate paddy production in 2020 forecast slightly below five‑year average

  3. Cereal import requirements in 2020/21 marketing year (July/June) estimated at record level

The 2021 main paddy season started in Sabah on time, supported by favourable precipitations

Land preparation and early planting of the 2021 main season paddy crop started in June 2020 in parts of the Sabah state. An average to above-average rainfall throughout June across the most of Sabah boosted moisture reserves and benefitted the ongoing planting operations. Planting operations are expected to start in August in Peninsular Malaysia, country’s main producing area, and in October in Sarawak State.

Aggregate paddy production in 2020 forecast slightly below five-year average

The 2020 cropping season is expected to conclude at the end of July and the aggregate paddy production is forecast at 2.6 million tonnes, slightly below the five-year average. Both the area planted and the average yields are forecast marginally below the five-year average.

Cereal import requirements estimated at record level in 2020/21 marketing year (July/June)

The country relies on cereal imports to satisfy its domestic needs as local production covers only about one-fourth of the total national cereal consumption. In the 2020/21 marketing year (July/June), the total cereal import requirements are estimated at a record 7.1 million tonnes.

Maize import requirements in the 2020/21 marketing year, which account for the bulk of the imported cereal quantity, are expected to reach a near-record level of 4.1 million tonnes, supported by strong demand from the feed industry. Wheat import requirements in 2020/21 marketing year (July/June) are estimated at 1.8 million tonnes, about 10 percent above the average on account of rising demand for quality bread and bakery goods. Rice imports in the 2020 calendar year are forecast at 1.2 million tonnes, 11 percent above the 2019 level.

COVID‑19 and measures adopted by the Government

On 18 March 2020, in an attempt to contain the spread of the COVID‑19 pandemic, the Government imposed several measures, including movement and travel restrictions, closure of educational institutions and countrywide ban on all form of mass gathering.

The Government has also implemented several measures to support national economic sectors.

On 27 February 2020, the Government approved the first package of measures of MYR 6 billion (USD 1.4 billion) for:

  1. Increased health spending

  2. Temporary tax and social security relief

  3. Cash transfers to sectors affected by the COVID‑19 pandemic

  4. Rural infrastructure spending

On 27 March 2020, the second package of support was launched for MYR 25 billion (USD 5.8 billion) for:

  1. Cash transfers to low‑income households

  2. Wage subsidies in order to help employers to retain workers

On 6 April 2020, a third support package of MYR 10 billion (USD 2.3 billion), which included grants for Small and Medium Enterprises (SMEs), was launched.

On 5 June 2020, the Government launched the fourth support package of MYR 21 billion (USD 4.9 billion), which included additional subsidies for wages, hiring and training subsidies, support for business digitalization and additional tax relief.