THE BEEF INDUSTRY IN MALAYSIA VIS A VIS THE NATIONAL FEEDLOT CORPORATION

First, there was the Department of Veterinary Services (DVS) of the Ministry of Agriculture. Then, the DVS was responsible for all livestock industries in Malaysia, and catered for both the health and production activities of the livestock.

It was not totally successful as insufficient support was provided to DVS, and the scale of operations was too large to handle for the Department. In the course of the country’s overall agricultural development, the University of Malaya, University Putra (then College of Agriculture) and MARDI got into the act to provide Research and Development support for the livestock industry, which included work with Dairy and Beef cattle, Buffaloes, Goats & Sheep, Poultry and Pigs , mainly. This was a positive step by the Government.

Having established this back-up system for the improvement of livestock in Malaysia, through proper research and application, the Governmentrealized that a lot more needed to be done. This was based on the fact that livestock numbers, especially cattle and buffaloes, were dwindling on a regular basis. Essentially, the production and reproduction of stock was not keepingpace with the slaughter of the animals for local consumption. There was, and is, negative growth in these two sectors.

To counter this, the Government set up Majuternak, as a production organization, to multiply cattle numbers. And, to ensure its success, it opened up production farms around the country and bought thousands of pure and cross bread cattle to fast tract the cattle reproduction process. This was a very practical and sound approach to increasing livestock numbers in the country. Moreover it was controlled by the Government, rather than the earlier practiced “Pawah” scheme, which was a failure. This is because the livestock were distributed to “selected people” rather than farmers with proven track records.

However, over a period of years, Majuternak’s role was taken over by DVS-for reasons unknown. And, the future of Malaysian’s cattle industry came to a grinding halt! The new production farms were given to DVS who eventually privatized these farms to some private operators. Farms in Sisek, Behrang Ulu, Batu Arang and Jelai Gemas were reduced drastically in size and converted to other uses like oil palm, townships, and even for Proton’s expansion. Presently only parts of the original farms in Kluang, Jelai Gemas, Ulu Lepar,Tersat and Tanah Merah remain. All this obviously affected the overall contribution in increasing livestock numbers, specifically cattle.

The end result, Malaysia is back to square one! We are in negative growth as far as cattle, buffalo, goat and sheep production are concerned. However, in the euphoria of producing Halal products, and the demand for Halal meat in Malaysia and the Middle EasternMuslim nations, the Government, through the Ministry of Agriculture decided to set up the National Feedlot Corporation to increase the country’s beef production. In the process the Government provided RM80 Million to develop the infrastructure, and anadditional RM250 Million to produce the beef via Feedlot Operations.

Sounds great. So what?

Today, everyone talks about Feedlot Fattening. I wonder if any real thought has been given to this programme? Essentially, Feedlot Fattening of cattle is a manufacturing process, involving two basic raw materials: young steers (male calves) of superior genetic material, with the potential to grow quickly, and a feed mix that provides maximum nutrition to achieve maximum growth, in the shortest possible time to achieve an economic and profitable enterprise. Of course the two principle ingredients have to be put together and managed properly, to achieve profitable results.

Grand Idea-Great Vision-Fantastic Potential. And, Malaysia becomes a Halal meat Producer and Exporter! Wait a minute. Let’s look again at the proposal. First question- do we have the raw material? A resounding, NO! So what do we do? We IMPORT the raw material to produce the finished product. Simple and common sense manufacturing practices will tell us that we are at the mercy of the raw material producers who will dictate the terms and costs of our end product- Halal Beef.

At the beginning we might get good prices for both raw materials. The primary producers can entice us to get into Feedlot Fattening by providing competitive prices. But, once we are into it, they can and will control the prices, so that we, the Feedlot operators, will be at their mercy. This applies to both steers and feeds. When this happens, what do we do? How do we control the price of the beef that is produced? How do we sell Halal beef that is affordable to the consumer? The prices will be too high, and we will end up losing our investment.

For decades, in Malaysia, the poultry and pig industry has had to struggle with the cost of imported feeds, in their production. Fortunately, at least the livestock components were being produced here. And, the producers of eggs, broilers and pork, working diligently with a combination of various feeds could still produce their products in a commercially viable manner.

The situation with regards to beef is totally different. We have no stock of our own to fatten, and we have insufficient feeds of our own to feed. However, Malaysia does produce a fair amount of palm kernel cake (PKC) which is an extremely good feed for fattening animals. However, literally 90% or more of this is exported because of better prices overseas. The Government should look at subsidizing the cost of PKC for use by local farmers or set an export tax to encourage local sales. Also, Oil Palm Fronds (OPF) should be promoted to be used as feed for these animals. Again, what is processed and produced locally is mostly exported. Even then, we are far short of the feeds required to produce Beef for export, let alone for our own consumption!

We need to be realistic and honest with ourselves. Stop this grandiose programme that will fail in the long term without proper planning and development of our own primary raw materials-stock and feed.

The Government needs to revert to a Majuternak like development programme. The private sector cannot and will not do this. The basic drawback is the availability of land, and the associated cost of development. Without the Government providing this essential commodity at a reasonable economic price, the private sector cannot embark on profitable and successful large-scale cattle farming.

The Honorable Minister of Agriculture has previously stated that we need up to 900,000 ha of land for ruminant production, and he encouraged plantation companies to utilize their land for cattle / goat and sheep production. This is a very positive approach to long-term ruminant development plans for Malaysia. But, it seems that it has fallen on deaf ears!

Pardon the cliché, but the Government must now take the “Bull by its horns” and tackle the issue of land alienation, for livestock production, at practical costs, and embark on a multiplication programme, on its own or in partnership with the private sector.

As far as technical and research and information for the multiplication of livestock and feeds is concerned, University Malaya, University Putra, MARDI, UKM and USM have all got more than sufficient applicable results available. And, there are sufficient experienced hands-on professionals to manage these production centers.

This is only an introduction to the present situation with regards to ruminant -cattle, buffalo, sheep, goats- production and problems in Malaysia.

The Honorable Minister and his Ministry must seriously review the proposals for improving livestock production, and not be hasty about overnight success. And even though as one Khazanah National Berhad official said, the gestation period for livestock production is too long, let us not forget that rubber, and, now, the Oil Palm industry took decades to be where it is. We can do same for the livestock production.

Malaysia can become a nett exporter of beef, especially, if the programme is set firmly and followed through on a long- term basis, without changes, every time a new man helms the relevant agency.


CRUSADE AGAINST CORRUPTION