FAMA Expands Market Intervention to Balance Supply and Stabilise Red Chilli Prices in Penang
GEORGE TOWN, May 1 — Federal Agricultural Marketing Authority has expanded its market intervention measures in Penang to address price instability in the red chilli market caused by a surge in local production since the beginning of the year.
According to an official statement, increased harvest yields driven by favourable dry weather conditions have led to a significant rise in supply, putting downward pressure on farm-gate prices.
This imbalance has affected small-scale farmers, who are experiencing reduced returns despite higher production levels.
To counter this trend, FAMA Penang has increased its direct procurement from farms, doubling daily purchases of selected commodities such as red chillies from one tonne to two tonnes.
The move is designed to absorb excess supply and stabilise prices, thereby reducing the impact of market fluctuations on producers.
At the same time, the agency has strengthened its Contract Marketing Programme in key production areas including TKPM Ara Kuda, Perda Veggie Park and Kepala Batas.
This initiative aims to streamline distribution while reducing reliance on intermediaries that often influence pricing dynamics.
Through these measures, FAMA seeks to maintain a balanced relationship between supply and demand over the medium term, ensuring more stable returns for farmers.
In addition, the agency is expanding its marketing channels through platforms such as Pasar Tani, Agro MADANI Sales (JAM), Agrobazaar Kedai Rakyat and weekly special sales programmes.
A dedicated sales initiative at KOMTAR, scheduled to begin on May 8, is expected to improve consumer access to competitively priced produce.
As of April 28, nearly 100 metric tonnes of agricultural produce, including red chillies, have been procured under the intervention initiative to help rebalance the market.
FAMA Director-General Abdul Rashid Bahri said the measures were implemented in line with government directives to stabilise prices and protect farmers’ interests.
He added that FAMA will continue strengthening its marketing network and expanding direct farm purchases as part of its long-term strategy to stabilise the agri-food sector.
In a related development, FAMA will collaborate with the Penang State Agriculture Department in an engagement session on May 5 to address farm-level challenges and develop additional support measures for local producers.
The agency also indicated its readiness to extend similar intervention strategies to other states if necessary, ensuring continued stability in national supply and pricing.
-wilayah.com.my
