Apparel makers worry as a Chinese port closes
Alternative ports to bring in imported fabrics, machinery may increase freight cost, shipping time
Bangladeshi apparel exporters worry that the partial closure of a port in China, which is used to import most of the raw materials and machines, may cause a supply chain disruption.
Alternative ports to bring in imported fabrics and machinery may increase freight cost and shipping time, they say.
The Chinese government decided to keep partially shut Ningbo-Zhoushan port, after a worker had come out Covid positive, threatening more damage to the already fragile supply chain as the Christmas shopping season nears.
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All inbound and outbound container services at Meishan terminal in Ningbo-Zhoushan port were halted on Wednesday until further notice due to a "system disruption," according to a statement issued by the port.
The closure will reduce the port's capacity by at least one-fourth, industry insiders said.
They expressed fear that if the closure continues for a long time, it will affect the global economy, as the port has the third highest capacity after Singapore and Shanghai.
Bangladesh Garment Manufacturers and Exporters Association President Faruque Hassan said the Chinese port is a gateway of a textile hub, not so far away from the port, and that capital machinery is also imported through that port.
Apparel makers are communicating with suppliers through emails, so they ship goods through other ports, Faruque said.
"We, apparel exporters, are having to troubleshoot problems every day to do business as this industry has thrived without local supply of basic raw materials- cotton and petrochemicals."
Fazlee Shamim Ehsan, vice president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said that Shanghai port, about 130 miles north of Ningbo port, might be used to import raw materials.
However, Shanghai is already congested, reports Reuters.
Ports on China's east coast, including Ningbo and Shanghai, are still processing a backlog caused by typhoon In-fa in late July.
The disruptions happened at a time when the demand for apparels rose in the US with merchants stocking up ahead of holiday sales.
Freight costs from China to the US went up to a record $20,000 per 40-foot box last month, a 500% increase on the cost in the same month last year.
