Four leading Malaysian feedmillers—Leong Hup Feedmill Malaysia, Dindings Poultry Development Centre, FFM, and Gold Coin Feedmills—have asked the High Court to suspend a penalty imposed by the Malaysia Competition Commission (MyCC), according to The Edge Malaysia.
The fine, issued in 2023, represents Malaysia’s largest penalty for alleged price-fixing in the chicken feed industry.
Together with PK Agro-Industrial Products, these companies collectively control about 40% of the national feed market, underscoring the case’s significance.
Their appeal to the Competition Appeal Tribunal (CAT) was dismissed earlier this year. The High Court has since granted leave for judicial review, allowing the companies to challenge both MyCC and CAT decisions.
Financial strain and food supply concerns
Lawyers for the feedmillers argued that immediate enforcement would strain finances and raise feed prices, potentially leading to higher poultry costs. Leong Hup, fined USD 34.6 million (USD 1 = RM4.55), noted it holds only 2% of market share, yet faces the largest penalty. Gold Coin was fined USD 21.5 million, Dindings USD 15.4 million, and FFM USD 9.4 million.
Counsel stressed that the poultry sector is capital intensive and already burdened by rising costs linked to global conflicts. They warned that paying the penalty now could force asset sales, reduce cash flow, and disrupt the supply chain.
Enforcement arguments and court review
MyCC argued the penalty was necessary to break pricing control among feedmillers and restore competitive practices. The Competition Act, introduced in 2010, was highlighted as a framework designed to encourage fair market behavior. Officials stressed that the companies remain financially strong, pointing to recent dividend declarations as proof of capacity to pay.
Lawyers added that if penalties proved burdensome, poultry farmers could shift to other feed suppliers offering lower prices. They maintained that enforcement would strengthen competition and would not destabilize the broader poultry feed industry.
The High Court will deliver its decision on the stay application on September 29. This ruling will determine whether the feedmillers must pay immediately or defer payment until judicial review is completed. With poultry feed central to Malaysia’s food chain, the outcome will influence industry practices and consumer prices nationwide.