Illustration: a dried riverbed with cracked mud and a stranded cargo barge under a hazy drought-orange sky
SANGGAU, Indonesia, Oct 19 — A supercharged El Niño has dried Indonesia's longest river to historic lows, stranding palm oil barges on newly exposed sandbanks and cutting thousands of smallholder farmers off from the mills that buy their harvests — a slow-motion climate shock that threatens to slash palm oil output across Indonesian Borneo by as much as 15% in the final quarter of the year.
With the rainy season delayed and rivers at their lowest in decades, the crisis on the Kapuas River shows how extreme weather is now hitting not just the fruit growing on the trees, but the arteries that carry the harvest to market.
What Happened
Supendi, a 33-year-old palm fruit farmer, cooled his heels at a palm oil mill in Indonesia's West Kalimantan for four frustrating days earlier this month, trying to unload his harvest of fresh fruit bunches before being told to leave — the site was full. "The fruit was not accepted," he told Reuters by telephone. "Now we're at a loss as to how to sell it."
He had driven from his hometown to the Multi Prima Entakai palm oil mill in the city of Sanggau in early October carrying 7 metric tons of fruit bunches from his small farm and neighboring ones. He is one of thousands of smallholder farmers in West Kalimantan stuck with rotting fruit they cannot sell.
The cause is the Kapuas River, Indonesia's longest at 1,143 kilometers. It transports 40% of West Kalimantan's palm oil output, according to data from the Indonesian Palm Oil Association, known as GAPKI. Prolonged drought driven by super El Niño conditions has shrunk the river so dramatically that sandbanks have emerged from the receding waters, causing several barges and tugboats to run aground, according to Reuters witnesses who visited the area.
With storage tanks filled with processed oil they cannot ship out, local mills have for weeks been cutting their fresh fruit bunch purchases. Thirteen palm oil mills out of 50 in West Kalimantan have been affected by the transportation disruptions, accounting for roughly half of the province's processing capacity, said Aris Supratman, who heads GAPKI's West Kalimantan office.
"Because of the disruption, shipments are being delayed, and once their storage tanks are full, they inevitably have to limit production," Aris told Reuters.
Background
El Niño — the climate pattern caused by warming Pacific Ocean waters off South America — typically brings hot, dry weather to Southeast Asia. But the strength of the current pattern has parched rivers and wells across Indonesia and fanned the country's most intense forest fires in 11 years in Borneo and Sumatra, spreading choking haze as far as Malaysia and Singapore.
The Kapuas crisis is distinct from the fires, though, because it strikes at the logistics of one of the world's most important commodities. West Kalimantan accounts for about 11% of palm oil output in Indonesia, the world's largest producer. Analysts estimate that fourth-quarter output across Indonesian Borneo could fall by 12% to 15% because of the El Niño-related disruptions.
This is not a normal dry spell. During the El Niños of 2015 and 2018, similar droughts lasted for about a month, several local farmers said. But this year the Kapuas has dropped to a lower level, and the effects have already lasted for two months. Indonesia's weather agency expects the start of the rainy season to be pushed back to November, from October normally — delaying both the river's resurgence and relief from the wildfires.
Illustration: a palm oil mill with full storage tanks of golden oil beside a huge pile of unsold palm fruit bunches
Road delivery is a limited alternative, because trucks carry less than barges and fewer are available, millers say. Dian Kurniawan, 44, a manager at the Multi Prima Entakai mill that turned Supendi away, said the company's fruit bunch purchases had dropped to 10,000 tons in September compared with the 30,000 tons it processed in July. As of October 1, the mill held 8,200 tons of crude palm oil, near its storage tank capacity of 8,500 tons.
"We usually can deliver 2,000 tons in four days, but with trucks sometimes we can only deliver 100 tons per day," Dian told Reuters, adding that truck shipments are not only slower than barges but also three times the cost.
GAPKI has revised down its 2026 national palm oil production forecast by 2.9% as the dry weather slows fruit maturity, adding a second blow on top of the transport blockade.
Why It Matters
Palm oil is the world's most consumed vegetable oil, found in everything from cooking oil and instant noodles to soap and biodiesel. A supply shock from Indonesia — which together with Malaysia accounts for the overwhelming majority of global output — can ripple through global food prices and trade balances. For food-importing countries in South Asia, the Middle East and Africa, tighter palm oil supplies translate directly into higher kitchen costs.
The human cost falls hardest on smallholders. Farmers unable to sell their harvests face difficulties maintaining their palm trees, said Indra Rustandi, who heads the West Kalimantan branch of smallholder farmers group APKASINDO, adding that the lack of income has caused some to cut their fertilizer applications by up to 70% to save costs. That fertilizer cut matters beyond this season: undernourished palms produce fewer and smaller fruit bunches for months to come, potentially extending the output slump into 2027.
Another Sanggau smallholder, 63-year-old Rahmat Wiyono, said he struggled to sell his fruit over the last two months, sometimes driving six hours only to be offered 2,650 rupiah ($0.15) per kilogram of fruit bunches, compared with three hours to his regular mill, which had paid 3,400 rupiah. "Some of our friends haven't had any harvest for the past two months, so they have had to find other ways to supplement their daily income," he said — "such as selling homemade cakes and donuts." (At the time of reporting, $1 was worth 17,940 rupiah.)
The crisis also illustrates a wider vulnerability. The same El Niño is battering food production across the region: in war-torn Sudan, drought is compounding famine risk; across Southeast Asia, heat and haze are straining economies. Climate shocks are no longer rare tail events — they are striking supply chains several times a year, often in places with the least capacity to adapt.
What Happens Next
Illustration: a smallholder farmer beside a truck loaded with palm fruit bunches on a dusty rural road, waiting to sell the harvest
Relief depends on the rain. Indonesia's weather agency expects the rainy season to begin in November, about a month later than normal. If the rains arrive on schedule and are strong enough to refill the Kapuas, barge traffic could resume and mills could clear their backlogs before the year ends. But officials caution that the recovery may be slow: silted channels and damaged vessels may need weeks of dredging and repair.
In the meantime, authorities are also battling the parallel wildfire emergency. Indonesia has deployed more than 69,000 firefighting personnel — up from around 44,000 in mid-September — as well as around 50 aircraft for waterbombing and weather modification, Reuters reported on October 22. The number of high-confidence fire hotspots fell to 565 on October 22, down from more than 1,200 on October 14, but officials warned the trend remains volatile.
For commodity markets, traders will be watching Indonesia's monthly palm oil export figures for signs of how much supply has been lost — and whether buyers shift demand to Malaysian suppliers, lifting regional prices. GAPKI's September estimate showed provincial supply falling about 11% from August; October data, due in the coming weeks, will show whether the slide has deepened.
For the smallholders of West Kalimantan, the wait is simpler and harsher: fruit that cannot reach a mill rots in a matter of days, and two lost months of income are already forcing painful choices between fertilizer and food.
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FAQ
What is the Kapuas River and why is it so important?
The Kapuas is Indonesia's longest river at 1,143 kilometers, running through West Kalimantan on the island of Borneo. According to the Indonesian Palm Oil Association (GAPKI), it transports 40% of the province's palm oil output, making it the critical logistics artery between mills, smallholders and export ports.
Why has the river dried up?
A supercharged El Niño pattern has brought prolonged hot, dry weather to Southeast Asia, parching rivers and wells across Indonesia. This year's drought is deeper and longer than the El Niños of 2015 and 2018 — the Kapuas has dropped to a lower level, and the effects have already lasted two months.
How badly has palm oil output been hit?
Thirteen of 50 mills in West Kalimantan — about half the province's processing capacity — are affected by the transport disruption. GAPKI estimated September supply from the province fell about 11% from August, and analysts estimate fourth-quarter output across Indonesian Borneo could fall 12% to 15%. GAPKI has cut its 2026 national production forecast by 2.9%.
Could this affect global food prices?
Possibly. Palm oil is the world's most consumed vegetable oil, and Indonesia is its largest producer. A sustained supply shortfall could push buyers toward Malaysian suppliers and lift regional prices — though the global impact depends on whether rains return in November and how quickly river transport recovers.
When will the situation improve?
Indonesia's weather agency expects the rainy season to start in November, roughly a month later than normal. That should begin refilling the Kapuas — but officials warn that silted channels and damaged barges may delay a full recovery of river transport by weeks even after the rains arrive.
Sources
- Reuters, Oct 19, 2026 — "El Niño-powered drought leaves Indonesian palm farmers high and dry as river recedes"
- Reuters, Oct 22, 2026 — "Indonesia's fire hotspots ease but rain still not enough, official says"
- GAPKI (Indonesian Palm Oil Association) data via Reuters, Oct 2026
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