Raise scrap rubber price to prevent smallholders switching to other crops
TAMPARULI: Rural Development Minister Datuk Seri Mahdzir Khalid reiterated his call to increase the floor price of scrap rubber from the current RM2.50 to RM3.50 to allow smallholders to enjoy better income.
This is also another way to prevent smallholders from switching to other commodity crops with higher prices, such as palm oil.
“When there is a price comparison between rubber and palm oil, many smallholders are switching to the higher price. That is why I support any proposal to increase the floor price.
“With this price adjustment, we will be able to help smallholders in Malaysia, including about 80,000 in Sabah,” he said when visiting one of Sabah Rubber Industry Board (LIGS) factories here on October 19.
Also present during the visit were Sabah Rural Development Minister Datuk Jahid Jahim, Deputy Rural Development Minister 1 Datuk Seri Abdul Rahman Mohamad and Secretary-General Datuk Ramlan Harun.
Recently, the media reported that the government was asked to consider increasing the scrap rubber price to RM3.50 from January next year to help more rubber tappers to get out of poverty.
Rubber Industry Smallholders Development Authority (Risda) chairman Datuk Mohd Salim Mohd Sharif was quoted as saying that the present floor price of scrap rubber, which is RM2.50 per kg, was far lower than oil palm, which could fetch up to RM1,100 per tonne.
Mahdzir added if more rubber smallholders started to plant oil palm, the country will be losing out more rubber producers.
On LIGS, he said the state government has three rubber processing factories located here, Tenom and Beaufort.
The factory here has about 300 employers with the capacity of processing 150 tonnes of rubber per day or 50,000 per year.
Apart from domestic market, products from this factory are exported abroad mostly to China, and also South Africa, Turkey, Brazil, Argentina and Taiwan.