Government steps in with RM15m monthly subsidy as palm oil costs rise

KUALA LUMPUR, Nov 11 — The Malaysian government has introduced a RM15 million monthly subsidy through the Cooking Oil Price Control Mechanism (MKHMM) to regulate bottled pure palm cooking oil prices and maintain a stable supply. This move came after a surge in global crude palm oil (CPO) prices, leading to increased production costs.

The Cabinet decision, made on Nov 6, aims to keep the ceiling prices for 1kg, 2kg, 3kg, and 5kg bottles of cooking oil at RM6.90, RM13.30, RM19.60, and RM30.90 respectively, as stipulated under the Price Control and Anti-Profiteering Act 2011. Without this intervention, the price of a 5kg bottle could have reached RM34 based on the current global CPO price of RM4,400 per tonne.

The government's interference is aimed at easing cost-of-living pressures, particularly due to the prolonged increase in global CPO prices since June 2025, which has put significant strain on manufacturers, causing some to halt production. The Ministry of Domestic Trade and Cost of Living, in collaboration with the Finance Ministry and other relevant bodies, implemented this mechanism to mitigate the impact of global market disruptions caused by the conflict in West Asia.

PRESMA president Datuk Mohammed Mosin Abdul Razak expressed that stable cooking oil prices would aid restaurant operators in managing their business costs more effectively. He further hoped for future targeted subsidies for restaurant operators, similar to those provided to manufacturers.