Adaptation10: The El Niño Effect

💡 Each month Climate Proof and DSR & Partners spotlight ten adaptation companies organized around a specific theme. Browse through previous editions HERE.

It is hard to overstate the scale and influence of El Niño. Those with a passing understanding of the phenomenon may mistakenly believe it’s a climate pattern solely affecting the Americas. Perhaps it causes wetter, stormier winters in the Gulf Coast and California. Maybe it contributes to a tornado outbreak in Florida.

In reality, El Niño unsettles weather systems all around the world — often in surprising ways.

El Niño — or the El Niño–Southern Oscillation, to give its full name — is a natural fluctuation in sea surface temperatures that occurs every two to seven years.

A periodic weakening of the easterly trade winds that girdle the equator causes warm waters in the western Pacific Ocean to pile up and slosh back eastwards towards the Americas. This water emits huge amounts of heat into the atmosphere, bending the jet stream and shaking up the distribution of water and warmth across the planet.

India, Indonesia, Australia, the Amazon, and southern Africa dry out. On the flipside, the Pacific coast of South America, southern Brazil, and east Africa flood. This one event means too little water in one place and far too much in another.

El Niño years create wilder weather patterns with the potential to inflict all kinds of unexpected losses on vulnerable populations and upset long-established supply chains, especially for food and commodities. For example, in July 2023, as an El Niño was building, India banned exports of non-basmati white rice as a precaution against feared disruptions to the rice harvest. In 2024, in the wake of that same El Niño, cocoa futures nearly tripled due to the failure of the West Africa harvest.

Palm oil — a ubiquitous ingredient in everything from chocolate spread to shampoo — is influenced by El Niño, too. An analysis by DSR & Partners of the nine strong El Niños since 1960 found that eight were followed by higher palm oil prices. Seventeen months later, prices were still 27% higher in the median.

This year’s event is unusually large. On October 8, 2026, the National Oceanic and Atmospheric Administration (NOAA) — the US weather agency — put the odds at 83% that, from October to December, this El Niño would be stronger than any other since at least 1950. NOAA expects it to keep strengthening until the end of the year, with its strongest impacts to persist until around March 2027.

El Niño impacts have been occurring for months ahead of this anticipated peak, however. By July, satellite fire-monitoring platform FireWatch was reporting more than 96,000 fire hotspots in Indonesia — more than at the same point in any previous year, including the disastrous fire seasons of 2019 and 2023. Indonesia’s weather agency said that powerful El Niño conditions could further suppress rainfall and exacerbate drought conditions, leading to even more hotspots. In September, smoke from Indonesia’s wildfires pushed Singapore’s air quality into the unhealthy range for the first time since October 2023. And in India, the meteorological department confirmed that the monsoon had ended with 13% less rainfall than normal, making it the fourth-weakest since 2001.

The physical fallout of this ‘super’ El Niño is already loading additional costs onto businesses and snarling essential global supply chains.

In the Amazon, the shipping line MSC announced low-water surcharges of up to $1,900 per refrigerated container for cargo to and from the port city of Manaus in Brazil, raising the cost of freight.

The Panama Canal is also running dry. Over the summer, its governing authority lowered the maximum draft, meaning ships heading for the US East Coast have to hold less cargo. Then in September, it cut the number of daily transits, raising costs for passage amidst concerns of worsening drought conditions. In August, South Korea’s SK Gas bid US$5.3mn for a single transit slot for one of its gas tankers, the highest price ever reported.

This is how El Niño is making itself known in company’s books. It arrives two or three links up the supply chain, raising complications and costs that ripple through the global economy.

El Niño is not a product of human-caused climate change. It is a natural phenomenon, and as such is predictable. However, climate change serves to multiply and exacerbate its impacts. The atmosphere and oceans are already warmer because of the heat-trapping gases humanity continues to pump into the air, creating a higher baseline for El Niño to build upon.

Governments, weather agencies, and academics have been preparing for this El Niño for months. Researchers at Columbia University are cranking out impact forecasts at a rapid clip, sharing the likelihood that specific temperature thresholds are breached as the phenomenon gathers power.

Smart companies are preparing, too. Prescient leaders recognize that this weather pattern in the Pacific is everybody’s business.

This edition of Adaptation10 spotlights a handful of start-ups and more established firms likely to see demand for their services surge as this climate pattern nears its peak. El Niño’s impacts are vast and varied — and so the chosen companies address a wide assortment of perils, and the supply chain disruptions they entail.

We trust you enjoy the selection.

Adaptation10 company profiles are compiled by DSR & Partners and reviewed by Climate Proof. Company funding and FTE data are extracted from public sources.

💡 Want to explore the profiles of 500+ adaptation companies in one handy database? Then check out the Adaptation & Resilience Innovation Search Engine, available to Climate Proof members. Feedback? Let us know HERE

Upstream Tech develops HydroForecast, an AI-based forecasting system for river flows and reservoir inflows. Its models learn from satellite observations, weather forecasts, and historical river data, and can predict how much water will reach a dam or river basin from the next few days to up to a year ahead, even on rivers where no measuring station exists. By giving operators earlier warning of both shortfalls and flood peaks, Upstream Tech helps hydropower producers, water utilities, and public agencies plan generation and manage supply through drought and extreme rainfall.

| HQ: Somerville, MA, US | Theme: Infrastructure / Ecosystems / Industry & Commerce / Agriculture, Food & Forestry | Sector: Information Technologies / Electricity Systems / Freshwater Ecosystems / Forestry & Logging / Terrestrial Ecosystems / Water Infrastructure | Hazards: 🌊 Flood / 🫗Water Scarcity / ☔️Precipitation /🔥 Wildfire | Last Raise: Undisclosed (Private Equity — October 2023) | FTE: 11-50 | Contact: [email protected]

Satellites on Fire provides AI-powered wildfire detection using satellites owned by NASA, NOAA, and ESA. Its platform combines imagery from more than eight of these satellites, updated as often as every five minutes, with ground cameras and fire spread modelling, and sends alerts straight to WhatsApp or SMS. The company claims these warnings arrive on average 35 minutes before NASA's own public alert system. By shortening the time between ignition and response, Satellites on Fire helps forestry operators, farmers, utilities, and fire agencies contain fires early, when dry conditions turn landscapes into fuel.

| HQ: Buenos Aires, Argentina | Theme: Infrastructure / Cities & Settlements / Ecosystems | Sector: Terrestrial Ecosystems | Hazards: 🔥Wildfire | Last Raise: $2.7mn (Seed — Mar 2026)| FTE: 1-10 | Contact: www.satellitesonfire.com/en/contactanos

Overstory provides vegetation intelligence for electric utilities. Its AI analyses satellite imagery tree by tree along power lines and can pinpoint the individual plants most likely to cause an outage or spark a fire. By showing where the risk is highest, Overstory helps utilities and grid operators send crews where they matter most, reducing wildfire ignitions, and keeping networks reliable as drought and heat weaken vegetation.

| HQ: Amsterdam, Netherlands | Theme: Infrastructure | Sector: Electricity Systems / ICT Infrastructure | Hazards: 🌩️Storm /🔥Wildfire | Last Raise: $43mn (Series B — Nov 2025) | FTE: 51-200 | Contact: [email protected]

SatSure provides decision intelligence built on satellite Earth Observation. Through its subsidiary KaleidEO, it is building its own satellites, including for India's first national Earth Observation constellation. Its platforms monitor crops, soil moisture, and drought down to individual farms, generating data that banks can use to assess loans for smallholders who have no formal credit history. By turning this data into early warnings and verified assessments, SatSure helps agribusinesses, lenders, and governments respond to failing monsoons and keep support flowing to farmers when harvests come under pressure.

| HQ: Bengaluru, India | Theme: Infrastructure / Social Systems / Ecosystems / Industry & Commerce / Agriculture, Food & Forestry | Sector: Insurance / Ground Transportation / Information Technologies / Crop Production / Electricity Systems / Financial Inclusion / Air Transportation / Forestry & Logging / Terrestrial Ecosystems / Financial Services | Hazards: 🌊Flood / 🫗Water Scarcity / ☔️Precipitation / 🌩️Storm / 🌡️Heat /🔥Wildfire | Last Raise: N/A | FTE: 51-200 | Contact: [email protected]

Forerunner develops AI-powered geospatial software for local governments. It started with floodplain managers who were tracking federal flood rules in spreadsheets and has grown into a single system that links each property to its flood zone, permits, inspections, and grants. By giving public agencies a clear view of which buildings and assets are exposed, Forerunner helps cities and counties prepare for heavy rainfall, enforce safer building standards, and recover faster after floods.

| HQ: San Francisco, CA, United States | Theme: Infrastructure / Social Systems / Cities & Settlements | Sector: Urban & Community Planning / Government Operations / Disaster Risk Reduction (DRR)| Hazards: 🌊Flood / 🫗Water Scarcity / ☔️Precipitation / 🌩️Storm /🔥Wildfire | Last Raise: $26.3mn (Series B — Feb 2026) | FTE: 51-200| Contact: [email protected]