SINGAPORE – The Republic’s favourite chicken rice dish may be more expensive in the coming weeks, on the back of chicken production costs hitting record highs in Malaysia.
Suppliers said that prices of fresh chicken are expected to increase by about 10 per cent, with the cost of a live chicken from Malaysia surging to between RM7 and RM8 per kilogram (S$2.25 and S$2.60), about 30 per cent higher than what it was a few weeks ago.
This is being driven by the higher cost of raw materials, such as corn and soybean, which are the main ingredients in poultry feed.
Some chicken and chicken rice sellers told The Straits Times that they have already been informed by their suppliers, and are deciding whether to pass on the cost to consumers or absorb them.
Chairman of Singapore’s Poultry Merchants’ Association, Mr Ong Kian Sun, said that chickens used to cost about RM5.80, but in the past week, prices have climbed sharply.
He said: “With the cost of chicken feed rising rapidly, some farmers in Malaysia are also unwilling to breed as many chickens as before. This will affect the supply and drive the price higher.
“It is true that what we are seeing now is unprecedented.”
Chicken is the most widely consumed meat in Singapore, with a per capita consumption of 36kg last year, according to data from the Singapore Food Agency.
The Republic imports more than a third of its chicken supply from Malaysia.
The price of corn has been skyrocketing since last August, from about US$149 per tonne to US$256 last month (S$199 to S$343).
Meanwhile, the price of soybeans also hit a peak in May this year, at about US$643 per tonne, compared with US$359 in the same period last year.
The last time corn and soybean prices were this high was about eight years ago.
Market reports have cited adverse weather conditions in corn and soybean growing regions, such as the United States and Brazil, which have driven up the prices of the agricultural commodities.
Mr James Sim, head of business development at Kee Song Food Corporation, said the primary ingredients in poultry feed are corn and soybean.
He said: “The combination of these ingredients has the highest nutritional value if we want the chickens to grow as much in the shortest amount of time. It is also easily digested.
“It will be difficult to use other ingredients, like carrots or fruits, as a substitute.”
The company, set up in 1987, is in the poultry industry and operates a processing plant in Senoko.
With the cost of poultry expected to continue increasing, poultry importers said they are unable to absorb the cost any longer and will have to raise prices.
Those in the industry said manpower and transportation costs, which have been rising in Malaysia due to Covid-19, have also contributed to the hike.
Mr Oh Wei Chiat, chief operating officer of Boong Poultry, which imports about 12,000 chickens from Malaysia daily, said the price it pays for chickens has increased by about 20 per cent in the past week to about RM6.60.
His suppliers have told him that the price will continue to rise and is expected to exceed RM7 in the coming weeks.
Mr Oh said: “I’ve never seen prices rise so sharply before, nor have I seen it hit this high since I started working in the industry.
“Just a few weeks ago, I was buying chickens at RM5.50.”
Mr Chester Chiew, chief operating officer of Sinmah Poultry Processing, said the company plans to increase prices by about 10 per cent.
He said: “For companies like us focusing on fresh chicken, there are no other alternatives because the only source is Malaysia. For the chickens to be considered fresh, they have to be alive when they are slaughtered.
“Also, our buyers, like chicken rice sellers, can only use fresh chicken for their products.”
For Mr Oh, he will consider importing more frozen chicken to give consumers more choices. Frozen chicken is typically cheaper than fresh chicken.
He said: “We’ve been trying to absorb as much cost as we can but the price has been increasing tremendously… by increasing our prices we are not making more money but just trying to maintain profits.”
Ms Lindawati Tjong, 47, has been selling chicken at Bukit Merah View market for about 10 years.
She is caught between absorbing the higher cost, which will eat into the already-thin profit margins, or passing it on to consumers and risk driving them away.
Mr Michael Poh, 41, who runs a chicken rice stall at a coffee shop in Toa Payoh, said he might have to raise prices for the chicken rice he sells from $3 currently to $3.50 next month.
“This is really the last resort, as we have been absorbing the rising costs from – gas, to oil and rental – in the last two years,” he said.
ST has contacted the Ministry of Trade and Industry for comment.