Datuk Seri Ismail Sabri Yaakob had once called for the elimination of the middleman in the agriculture sector and food supply chain back when he was prime minister.
This was in response to the global food inflation due to the disruption of the food supply chain caused by the Covid-19 pandemic. This curbed agricultural activities, in turn reducing food exports, as well as the breaking-out of the Russia-Ukraine war.
The war has threatened the delivery of some of the world’s staple crops, causing food inflation to worsen. Concerns about the insufficient food supply are a global issue and not only in Malaysia. – Datuk Seri Ismail Sabri Yaakob, former prime minister
Traditionally, a middleman is a broker, go-between, or intermediary to a process or transaction. This intermediary will earn a fee or commission in return for services rendered in matching buyers and sellers.
Many farmers and fishers have relied on selling their products to middlemen for their income, and in turn, the middlemen will perform the marketing functions for the farmers as well – buying produce from the producers and either selling it to the wholesalers or processing them.
Unfortunately, however, this relationship rarely benefits the farmers and fishers, with middlemen exploiting small producers with lower price offerings and a higher rate of interest, which is deducted from the proceeds of the producer’s sale to the middlemen.
There have been cases in which up to 75% of the proceeds from paddy sales were deducted because of “poor quality”. In other words, farmers received only a quarter of what was supposedly due to them. Some studies have shown that the deduction rates for paddy at times are purposely overestimated by the buyers to safeguard their profit margins.
Though Malaysia has a fair trade policy, it does not seem to cover the brokering and distribution of locally-made products.
These markets and organisations aim to solve this issue, cutting the middleman out entirely and ensuring that farmers, fishers and other local producers get the fair amount of profits they deserve.
#1: Pasar Pendekar Laut
The brainchild of 35-year-old fisherman Shalan Jum’at, Pasar Pendekar Laut seeks to give the fishing community of Jetty Pak Ngah in Pendas Laut, Johor Baru a chance of getting fair earnings for their hard work.
We started operations in 2016 as a way to help fishermen get a fair price for their catch. Middlemen often enjoy a large portion of the profits from these catches, leaving fishermen hardly enough to cover the costs of going to the sea, including petrol expenses. – Shalan Jum’at, founder of Pasar Pendekar Laut
Fishers who sell their catch to this market are paid up to 90% of the market price, with Shalan retaining an average of only 10% or even less for covering market expenses.
Sometimes, if they only manage to get a small amount of catches, I will not take any charges. As a fisherman myself, I understand very well how hard things are for them. I started going to the sea when I was a small kid and saw how my father and grandfather put their lives at risk to get the catches but ended up being paid less than they deserved. I want the fishing community to be paid fairly for their craft and skills. – Shalan Jum’at, founder of Pasar Pendekar Laut
Visit their Facebook to find out more.
#2: Earth Heir
Earth Heir was founded to serve traditional artisans in underserved communities – supporting their craftsmanship with holistic ethical business operations, including education, collaborative design partnerships, production & supply chain training, market access, financial support, and fair trade commercial practices.
Earth Heir collaborates with local artisans on the designs of products and to procure raw materials, as well as purchasing from local artisans and cooperatives or designers at fair prices and working closely together with marginalized groups in the supply chain.
Visit their website to find out more.
#3: Biji Biji Ethical Fashion
Biji Biji is an ethical, environmentally-focused fashion label founded in 2013. The company sells locally-made accessories and apparel such as handbags, folders and coasters. Its mission is to transform the alternative into the norm, encouraging the up-cycling of materials to create a sustainability-focused circular economy.
Today, Biji Biji is based in Publika Shopping Gallery in Kuala Lumpur with a number of retailers across Malaysia.
As part of its sustainability initiative, Biji Biji works closely with multiple NGOs and underprivileged communities in Malaysia including refugees, to help provide ethical standards to the fashion industry.
Visit their website if you are interested in supporting Biji Biji’s mission.
#4: The Hive Eco Store
The first zero-waste store in Malaysia, offering the largest bulk whole foods options, as well as cleaning products and eco-friendly personal care and lifestyle products.
The Hive also works closely together with local producers, partnering up with local organic farmers, women entrepreneurs, refugees and other social enterprises to create a more tangible social impact.
Among the products in Hive’s catalogue are reusable angpaos locally made by the Dignity for Children Foundation. Founded in 1998 to help urban poor and refugee children in Sentul, dignity now cares for over 18,000 underprivileged children aged two to 18.
Check out their online store here.
#5: Helping Hands Penan
Living within settled and hidden communities in Borneo are the Penan people. As they often rely on the natural resources of the jungle for survival, the Penan community are at great risk as land development destroys their home and in turn, affects their livelihood.
On a mission to restore hope and ensure a bright future for the Penan community, Helping Hands Penan was officially launched in 2016 but has been operating for over a decade. The social enterprise aims to empower the Penan people to be self-sufficient and works hard to supply their short-term basic needs.
I hope that I can earn more money as a basket weaver. My dream is to lead a better life and enable my four children to complete their studies and have a brighter future. – Frida King, weaver
This is done through the fruit of their hands – weaving, a generational skill passed down. Profits generated from these crafts go toward solar lights for settlements without power generators, chain saws and rice milling machines for the Penan community to earn their livelihood.
Additionally, funds are allocated for transportation costs from settlements deep in the jungle to urban schools, providing school supplies and monthly allowances for Penan students pursuing higher education.
Be sure to support them by visiting their website to check out the assortment of beautiful crafts!
#6: OA Organik
In Malaysia, a majority of the Orang Asli (OA) communities are poverty-stricken and live in squalid conditions. The Centre for Orang Asli Concerns estimated that 99.29% of all Orang Asli households earn below RM4,000 a month.
With no income, no access to alternative avenues of income and no natural food sources, their hands are completely tied. – Covid-19 Collective for Orang Asli
OA Organik was formed to combat the issue of poverty and improve the OA’s quality of life. The organisation provides capital, training, appropriate technology and marketing support to facilitate growth among the OA through eco farms and high-quality organically grown produce.
Profits from the farms are then distributed accordingly among the farmers. As of 2020, OA Organik has been helping at least 48 OA farmers, with full-timers earning RM600-RM2,400 monthly while the part-timers earn RM200-RM500.
#7: Langit Collective
The Langit Collective began with the four founders who worked as rural community organisers. They travelled extensively in rural areas building gravity-fed-water systems for rural communities in Sabah and Sarawak.
Living with the local communities brought them closer to their plights, thus they founded the Langit Collective to create a sustainable economic ecosystem in rural areas. From 2015 to 2020, the Langit Collective positively impacted 9 villages in 3 rural communities, providing RM320k direct payout to farmers.
The Langit Collective specialises in rice, spices and other agricultural products, all produced by smallholder farmers in East Malaysia and procured at a fair price – a minimum of 35% of the retail proceeds go directly to the farmers.
Check their website to view their products or learn more about the company.
Explore our sources
- C. Ignatius. (2022). Eliminate The Role Of Middle Man In Agriculture Sector; Ismail Sabri. Link.
- F. Mohamed Arshad. (2020). My say: Can middlemen be eliminated, especially in the agriculture and fishing sectors? Link.
- V, Devi. (2021). Fair market for fishing community. Link.
- Survival. (2019). The Penan. Link.
- Helping Hands Penan. (2021). Our Story. Link.
- Chandran, S. (2022). Two Malaysian social organisations are improving the lives of Penan and Orang Asli communities. Link.
- SL, Wong. (2020). Almost all of Malaysia’s Orang Asli are locked into poverty and struggling. Link.