'Cannot play hide and seek': Minister's warning over haze sends Singapore agricultural stocks lower

Key points

• Singapore agricultural stocks fell after Senior Minister K Shanmugam warned companies over the haze.
• Bumitama Agri dropped as much as 6.5% and First Resources fell to a low of 4.83%.
• Shanmugam said Singapore could amend or introduce laws urgently to ensure cooperation.

Shares of several Singapore-listed agricultural companies fell on Tuesday after Senior Minister K Shanmugam warned that firms would not escape responsibility for their possible role in the haze affecting the city-state. Bumitama Agri fell as much as 6.5%, First Resources dropped to a low of 4.83%, and Golden Agri Resources and Wilmar International each slipped almost 2%.

Shanmugam, who is also home affairs minister, said seven companies had been questioned by the Singapore Exchange. He said some fire or smoke source points appear linked to First Resources, Bumitama Agri and non-listed First Borneo Plantations.

Companies named by minister

Besides First Resources and Bumitama Agri, the minister named Golden Agri-Resources, Wilmar International, Kencana Agri, Indofood Agri and TSH Resources. He said First Resources had issued a detailed statement on its zero burning policy and firefighting efforts, but that statements alone were not enough and the company should show evidence.

Shanmugam said Singapore would use every legal and regulatory lever available, including pressure on companies' bottom lines, access to financing and standing with investors. He said the government could amend laws or introduce new laws on an urgent basis if needed, and that companies possibly linked to the haze would be examined for eligibility for government grants or incentives.

Companies cannot play hide and seek

— K Shanmugam

Diplomatic concerns dismissed

Asked whether Singapore's actions could affect relations with Jakarta, Shanmugam dismissed the concern. He was responding to a CNA article citing legal experts who said action against haze-causing firms in Indonesia may carry diplomatic implications.

Shanmugam said Singapore's actions align with the broad policies of Indonesian President Prabowo Subianto and that Singapore hopes for full cooperation from Indonesia in going after the companies. The haze has affected businesses and daily life in Singapore and Malaysia in recent weeks, with Singapore's air quality reaching levels not seen since 2015, and schools in Johor Bahru closed due to unhealthy air quality.