Fast fashion retailers could see containership deliveries from Asia to the UK facing severe delays and spiralling costs due to troubles affecting both the Suez and Panama canals, a report has warned.
International delivery expert ParcelHero claims that “global supply chains are in crisis” as a result of the Houthi attacks on Red Sea vessels, which have impeded access to the Suez Canal, as well as the growing expenses and delays brought on by the drought in the Panama Canal.
That may have significant effects on transitional products in late winter and early spring. Following a lacklustre second half in 2023, it might pose serious issues for some retailers, both big and small.
Along with fashion, home goods is another big industry experiencing significant disruption. According to the research, “From Next to Ikea, many well-known retailers have already sounded the alarm as the attacks continue and disruption increases.”
David Jinks, ParcelHero’s Head of Consumer Research, said, “Already, we have a drought in Panama severely reducing both the number of ships and the amount they can carry using the Panama Canal. Now the most direct route between Asia and Europe, via the Suez Canal, is being severely disrupted. Losing unrestricted access to these two vital trade routes will mean spiralling costs and lengthy delays.”
He pointed out that one-third of all container ships in the globe travel the Red Sea/Suez Canal route, with many of them transporting thousands of goods manufactured in Asia for the UK and continental Europe. Among the most impacted are fashion products.
At the start of the attacks, the three major shipping companies in the world—MSC, Maersk, and CMA CGM—announced that they were stopping their Suez Canal transits. Many ships chose to reroute via the Cape of Good Hope rather than take the chance of being shot upon.
The report also stated that as a result, “costs have increased significantly and delays have occurred for Asian-manufactured goods headed for the UK.”
