Raising income of farmers tops Fama chairman’s agenda

KUALA LUMPUR: Come September, it will be 54 years since the Federal Agricultural Marketing Authority (Fama) was established to serve as the national agricultural marketing agency under the Agriculture and Agro-based Industry Ministry.

Today, Fama still stands strong and continues to drive the domestic and international markets, expanding market access for the local agriculture and agro-based industry products and making sure they are made available to consumers at affordable prices.

Ishak Ismail, whose appointment as FAMA chairman took effect on Nov 1, 2018, is determined to continue the efforts made by his predecessors to ensure FAMA meets its mission and vision.

Ishak, 51, who is from Bukit Mertajam, Penang, is a member of the Board of Valuers, Appraisers, Estate Agents and Property Managers, and chairman of its property management practice committee. He is also president of the Malaysian Muslim Real Estate Consultants Association.

He has a bachelor’s degree in property management from Universiti Teknologi Malaysia and a master’s degree in Business Administration from International Islamic University Malaysia.

Bernama interviewed Ishak recently to find out the directions he will be charting for Fama during his two-year term as chairman.

Here are excerpts from the Question and Answer session.
Q: As chairman, what are your plans for Fama?

A: In line with the developments under Industry 4.0, Fama is using its Agrobazaar Online portal and application to reduce the supply chain between the producer/farmer and consumer. I wish to see Fama excelling in the marketing of its commodities, that come in the form of fresh produce and processed agro-based products, to elevate the incomes of farmers and enable consumers to buy the products at reasonable prices.

I also feel Fama should enhance the efficiency of its delivery system via an integrated communication system using the mass media and online and offline applications such as Fama Mobile Comm.

Human capital development will also be stepped up to create a culture of excellence among the employees who are an important asset in the progress of any organisation.

Q: How do you view the present state of the nation’s agricultural sector?

A: The rapid development of the industrial sector has made the agricultural sector relatively less significant but this is often misunderstood to mean that the agricultural sector is being neglected. The truth is, the sector’s contributions have actually seen tremendous growth.

The sector’s contribution of inputs to agro-based industries that focus on downstream activities has been huge. We have to focus on helping to increase production values to reduce our existing imports. In short, when the focus is on the production aspect and the strategies adopted are consistent with the economic principles of supply and demand, agriculture will play a special role in this country’s industrial process.

The agricultural sector also calls attention to the need to ensure food security. Besides military and diplomatic strength, the production of sufficient food to meet the population’s needs is also a priority for the nation.

We have also devised long-term strategies to export our signature products, as well as halal items produced by our local entrepreneurs that have the potential to penetrate foreign markets. These (strategies) will pique the interest of farmers, fishermen and, in particular, young entrepreneurs who would want to get involved in the agricultural sector, which is poised to become a strategic industry capable of generating new business opportunities and sources of wealth.

Q: What are the measures that can be taken to address the weaknesses in the nation’s agricultural sector?

A: Among the weaknesses are the existence of small-scale farms and their high production costs, low returns and poor quality products. The main reason for these is the low utilisation of technology and mechanisation.
In the meantime, the domestic market is too small to reach the critical mass required to attain cost efficiency and reasonable returns on investment. So, the agricultural sector’s problems are related to the 80 per cent subsistence farmers and small-scale farmers. As for the commercial farmers, our focus is on helping them to gain a wider foothold in the export market.

To help resolve the problems faced by the small-scale farmers, programmes that have been planned (earlier) have to be implemented widely. These include ascertaining the types of crops that the farmers can plant which can be marketed either fresh or in processed form.

Market guarantee is essential to earn the confidence of farm operators and this can be done through contract farming. Contract farming has to be managed by government institutions, as well as private organisations with the help of the government.

Collaboration between government and private agencies is essential in reinforcing production policies that are based on the needs and requirements of the market, whether domestic or international, by integrating information related to market demand and supply.

Q: To what extent has Fama, as the leading agricultural marketing agency, achieved its targets?
A: As of December 2018, Fama has successfully opened 2,755 (sales) outlets involving 68,156 entrepreneurs, generating sales worth RM2.89 billion last year. The outlets comprise fresh fruit stalls, ‘Pasar Tani’ or Farmers’ Market, permanent Farmers’ Market, Agrobazaar Rakyat and Agrobazaar K-shoppe.

For 2019, Fama targets to open 177 additional outlets and generate sales worth RM3 billion from the 2,932 outlets.

Q: What are the marketing strategies employed by Fama?

A: To bolster up the supply of fruits and vegetables for the agro-food industry, the Agriculture and Agro-based Industry Ministry has implemented the contract farming programme together with Fama, Department of Agriculture, Farmers Organisation Authority, Malaysian Agricultural Research and Development Institute and Agrobank.

To ensure the supply of fresh produce to the farmers’ markets, Fama has implemented a programme to match at least five farmers with each trader.

Fama will also step up its direct-from-farm sales where the prices of fresh produce are five to 20 per cent lower than the usual market prices. This programme is being conducted at all Fama outlets, including ‘Pasar Tani’, My Best Buy and ‘Bazaar Peduli Rakyat’.

Apart from that, Fama will also strengthen its existing outlets, such as ‘Pasar Tani’, MyFarm Outlet, Agrobazaar Kedai Rakyat, Agrobazaar K-shoppe and others, as well as its online marketing platform Agrobazaar Online.

With this, the supply chain will be shortened to enable farmers to earn a reasonable income and consumers to buy the products at reasonable prices.

Fama will also forge closer ties between the farmers and producers by conducting programmes and upskilling courses on commodities, such as durian, that currently enjoy high market value.

Q: What are the innovations by Fama itself to improve the marketing of the nation’s agricultural products?

A: Since Fama ‘s establishment in 1965, it has come up with various sales innovations, including Farmer’s Caravan, Food Truck and Agrobazaar Online. Fama has also developed the Self-Regulated by Regulated Entity regime to enhance the grading of export-bound products, with an auditor’s certification.

Q: Malaysia spends billions of ringgit on food imports and the cost keeps rising. What are the steps that can be taken to reduce our dependence on imports?

A: Vegetables and fruits that come from other countries pose stiff competition to the local farmers’ produce as the imported ones are being sold at lower prices due to low operating costs.
As a free market economy, Malaysia cannot stop foreign products from entering the nation.

However, the government can through the relevant departments and agencies tighten the import procedures so that products cannot make their way into the country arbitrarily.

For example, the Health Ministry can take samples of imported products at the various entry points (ports, airports or border areas) for regular checks to ensure that they complied with the Food Act 1983 and did not possess pesticide content exceeding the maximum residue levels. Products that contravene the Act will not be permitted into the country for a specific period of time.

Fama is also stepping up the enforcement of the Agricultural Grading, Packaging and Labelling Regulations 2008, under the Federal Agricultural Marketing Authority Act 1965, to ensure wider compliance.

Local farmers should also be ready to transform their production techniques and operate on a large-scale basis, using modern and up-to-date technology in order to yield high-quality products at competitive costs.

Q: Our dependence on food imports is a rising threat to our nation’s food security. It is not impossible for Malaysia to face food shortage if there is no clear policy to address the situation. Can you explain how the nation is preparing for this?

A: The Agriculture and Agro-based Industry Ministry unveiled a five-point plan on Feb 14 this year to ensure national food security and take care of the people’s well-being. The first point covers efforts to modernise and increase agricultural output to ensure stability in supply and food prices by giving more emphasis to the rice, livestock and fishery sub-sectors.

The second point will boost private-sector investments in agriculture commercially, as well as enhance agricultural export trade. The government also wants to turn agriculture into a solid, sustainable and profitable revenue source for farmers, livestock breeders, fishermen and young agropreneurs. The government will also improve the agricultural industry ecosystem to support the modernisation of agriculture, private-sector investment and expansion activities for farmers, livestock farmers and fishermen, as well as strengthen the organisational structures of the ministry’s departments and agencies to improve the delivery system and governance.

In this respect, Fama will increase its (food) supply by expanding contract marketing and boosting the development of downstream products, as well as developing more young agropreneurs.

Q: In your opinion, should the government make changes to its existing agriculture policy to increase agricultural output?

A: The Agriculture and Agro-based Industry Ministry is currently guided the National Agro-Food Policy (NAP) 2011-2020. I understand that the ministry is now drafting NAP 2.0 and is taking into account current developments, needs and issues in order to strengthen the nation’s agro-food sector and make it more competitive.

One of the issues that have to be looked into is the wastage of resources such as agricultural land that is lying idle and not being optimised. I hope the various state governments can come up with an inventory of idle land (in their respective states) so that Fama can help to link the landowners to investors, cooperatives and commercial farmers. The landowners can either lease out their land or strike up strategic partnerships that can benefit both parties.

I hope that with the support, commitment and cooperation of all the parties involved, Malaysia’s agro-food sector will continue to grow to meet the aspirations of the farmers/producers. – Bernama