Rubber Incentive Raised to RM3.30/kg in Budget 2027 to Aid Smallholders
The 2027 budget lifts the Rubber Production Incentive to RM3.30 per kilogram, aiming to offset costs for small rubber farmers.
In the 2027 budget, the Rubber Production Incentive will rise to RM3.30 per kilogram, a step up from the existing RM3 rate. The increase is designed to cover part of the production expenses faced by small rubber growers and to provide extra income support. PKPKM leader Adzmi Hassan described the adjustment as a positive sign of the MADANI government's concern for farmer welfare amid volatile market prices and higher input costs.
He also urged the authorities to grant 100% financing under the Smallholder Oil Palm Replanting Incentive and to simplify its payout method, noting the financial strain of replanting and the income gap before new palms mature. Additionally, PKPKM asked the ministries overseeing plantations and rural development to reconsider the minimum 0.5-hectare land-ownership rule, arguing that many productive smallholders own less land. Prime Minister Datuk Seri Anwar Ibrahim highlighted the IPG hike as the third increase since 2022.
Why it matters
Higher rubber incentives could improve incomes for Malaysia's small farmers and affect the country's rubber export sector.
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