1kg polybag cooking oil price to remain subsidised

PUTRAJAYA: The price for 1kg polybag cooking oil packages will be maintained at RM2.50 as the government pledged to continue subsidising them.
However, Domestic Trade, Cooperatives and Consumerism Minister Datuk Seri Hamzah Zainudin said subsidies for all other bottled packaging would be removed from Nov 1, including the 5kg ones, in line with the government's cooking oil rationalisation plan.
He told a press conference here today that in a recent discussion with Prime Minister Datuk Seri Najib Abdul Razak, they agreed that what's most important was the low-income group.
"We understand that these are the people who usually buy the 1kg packs, which is why I'm announcing today that the price for the 1kg polybags will remain at RM2.50," he said.
He said the removal of subsidies for the bottled packages was necessary due to the increase in global olein (raw palm) oil price, averaging an increase of RM600 per metric tonne since last year.
He said the government had spent an additional RM400 million over its allocated budget for cooking oil subsidies so far this year, due to inflation.
He said experts predicted the global olein price would be around RM2,900 per metric tonne in November (RM2.90 per kg), which could mean consumers paying 40 sen more per kg for future unsubsidised packages and when the costs for packaging and distribution were included that could cost a further RM1 or so.
Bottled cooking oil prices (after subsidy) for 500g, 1kg, 2kg, 3kg and 5kg are currently at RM1.85, RM3.30, RM6.25, RM9 and RM13.35 respectively.
He noted cooking oil prices in other Asean countries were above RM4 per kg and this resulted in them purchasing wholesale from Malaysia to resell in their countries.
Asked if subsidy removal would result in food traders increasing their prices, he said enforcement would be done to ensure it does not happen.