BUTTERWORTH, September 18 — The Federal Land Development Authority (Felda) is seeking a 30-year extension of the land lease for MSM Malaysia Holdings Bhd’s sugar refinery in Perai, Penang, as its current lease with the Railway Assets Corporation (RAC) is set to expire in five years.
Felda chairman Datuk Seri Ahmad Shabery Cheek said the refinery, built in 1964, plays a crucial role in Malaysia’s sugar supply chain due to its strategic location near ports and railway lines. He warned that shutting down the Perai plant, the country’s largest sugar refinery, would disrupt national food security and require costly alternatives, including a new RM4 billion facility or upgrading Johor’s refinery at over RM1 billion.
Shabery stressed that Felda is in preliminary talks with Penang chief minister Chow Kon Yeow and the transport ministry to secure the extension, adding that relocation options are limited due to logistical needs. “We appreciate the state government’s development plans, but any closure before a proper alternative is in place will have serious implications for the country’s sugar supply,” he said during a site visit, where he also launched the Felda Special Edition Perai Sugar.
MSM Perai currently produces 24,000 tonnes of sugar monthly and maintains buffer stocks of 32,000 tonnes to stabilize the domestic market. At the same time, Felda has urged the federal government to abolish the Approved Permit (AP) and Import Permit (IP) for refined sugar, citing that Malaysia already produces more than enough for local consumption.
Shabery noted that about 60,000 to 70,000 metric tonnes of refined sugar are imported annually, sold at the same controlled price as local sugar despite higher foreign production costs. He described this as a “clear element of dumping” that threatens local manufacturers and jobs.“ Countries like Vietnam, Thailand, and Indonesia sell sugar at RM5 to RM8 per kilogram, yet imported sugar can be sold here for RM2.85, the same as our controlled price,” he said.
Shabery added that Felda has raised the issue with the finance ministry and the domestic trade and cost of living ministry, stressing that ending refined sugar imports is vital to safeguard the future of Malaysia’s largest sugar producer, MSM, and ensure stability in the nation’s supply chain.
