Malaysia Food Security Industry

Technologies that digitalize, automate, and build resilience in agriculture will be essential for tackling Malaysia’s food security challenges. The country’s agriculture sector is grappling with the challenges of low yield, a growing population, urbanization, climate change, and water management.

Malaysia is highly dependent on imports for essential food items such as onions, dairy products, coffee, wheat flour, tea, potatoes, cooking oil, mango, coconut, and beef. In 2023, food imports rose to approximately $18 billion, a ten percent increase from the previous year. This reliance on imports poses economic challenges and heightens food security risks as the country’s population is expected to grow from 35 million today to 44 million in 2050.

The local workforce is converging in urban centers in pursuit of more stable and higher-income employment. The average age of the country’s farmers is above 60, thus raising concerns about an aging and decreasing agricultural population. Technologies that support agricultural automation and urban farming are needed.

To address these issues, the federal budget for 2025 will include a $856 million fund to offer loans for agri-food entrepreneurs to adopt more digitalization and automation. Earlier this year, the Prime Minister also announced a targeted $225 million urban agriculture program to create economic opportunities for urban farmers, increase the country’s agricultural output, and improve food security.

Another challenge is climate change, with altered rainfall patterns and projected temperature increases threatening crop yield. The industry also faces water management issues, with agricultural water use achieving only 50 percent efficiency. Solutions that improve irrigation systems and help build resilience against climate events will become more essential.

In its commitment to ensuring a stable supply of staple food items, the government recently announced a $225 million two-year rice planting project covering 27,000 acres. This project will upgrade rice infrastructure, aiming to boost crop yield and increase farmer income. The 2025 federal budget also includes a $68 million allocation for collaboration with state governments on onion production, fish farming, and paddy yield increment projects.  

U.S. firms offering agricultural automation equipment and digital agriculture technologies such as satellite monitoring, drones, sensors, and predictive modeling software could play a key role in addressing food security issues. If you represent a U.S. company and want to learn more, please contact Commercial Specialist Mohan Gurusamy at office.kualalumpur@trade.gov.