El Niño Drought Strands Indonesia’s Palm Oil Farmers As Kapuas River Recedes

Palm oil farmers in Indonesia’s West Kalimantan province are struggling to sell their harvests after a prolonged drought caused the Kapuas River to recede, stranding cargo barges and preventing mills from shipping processed oil, Reuters reported on Monday.

Thousands of smallholders have been left with rotting fresh fruit bunches as mills turn away deliveries because their storage tanks are filling up. Supendi, a 33-year-old farmer, told Reuters that a mill in Sanggau refused to accept seven tonnes of fruit he had transported from his farm and neighbouring plots.

“The fruit was not accepted,” he said.

River Runs Low

The 1,143-km Kapuas River carries about 40% of West Kalimantan’s palm oil output, according to the Indonesian Palm Oil Association (GAPKI). Receding water levels have exposed sandbanks, leaving tugboats and cargo barges stranded.

Trucks offer a limited alternative because they carry less cargo, are less readily available and cost more to operate. One mill manager told Reuters that deliveries by road could cost three times as much as barge transport.

Thirteen of West Kalimantan’s 50 palm oil mills have been affected by the disruption, accounting for roughly half of the province’s processing capacity, GAPKI said. The association estimated that palm oil supply from the province fell about 11% in September compared with August and lowered its forecast for Indonesia’s palm oil production in 2026 by 2.9%.

Farmers unable to sell their produce are also cutting spending on plantation maintenance. Some have reduced fertiliser applications by as much as 70%, according to a representative of the smallholder farmers’ group APKASINDO.

El Niño Intensifies

Indonesia’s meteorological agency, BMKG, reported that the three-month ENSO index for August-October reached +3.08 in its first October assessment, indicating a very strong El Niño event. The agency said the phenomenon was contributing to lower rainfall across much of the country.

The US National Oceanic and Atmospheric Administration’s Climate Prediction Center said on October 8 that El Niño was continuing to strengthen and that a strong-to-very-strong event was likely to persist through January-March 2027. Rainfall anomalies remained suppressed over Indonesia, it said.

BMKG’s seasonal forecast, published in October, projected that the rainy season would begin later than usual across 61.08% of Indonesia’s land area. The delayed rains are expected to prolong the low-water conditions affecting river transport.

Economic Fallout

West Kalimantan accounts for around 11% of Indonesia’s palm oil production. Analysts estimate that output across Indonesian Borneo could fall by 12-15% in the fourth quarter because of El Niño-related disruptions, Reuters reported.

The drought has also contributed to forest and peatland fires across Borneo and Sumatra, spreading haze into neighbouring Malaysia and Singapore. Indonesia’s disaster agency said in October that fires remained severe across six provinces, with firefighting teams tackling blazes on peatland.

For smallholders, the immediate concern remains the inability to sell harvested fruit. With the rainy season delayed and river transport constrained, farmers and mills face further disruption until water levels recover.