Global: Strait of Hormuz closure triggers 'most severe supply chain shock' for garments & textiles since COVID-19
"Hormuz crisis: Story update on energy and textile costs", 12 March 2026
The near-total closure of the Strait of Hormuz since late February 2026 has triggered the most severe supply chain shock for the global textile and apparel industry since the COVID-19 pandemic. Ship transits have collapsed by 97 per cent, crude oil prices have surged 26 per cent (as of March 12), bunker fuel costs have doubled, and all four major container lines have suspended operations through the Hormuz. The disruption threatens to push global textile production costs up by 10–15 per cent, with polyester value chains absorbing the steepest impact...
The Southern India Mills Association (SIMA) and the Bombay Yarn Merchants Association both flagged acute supply uncertainty...The Middle East’s massive petrochemical export hubs...sit squarely behind the blockade, trapping PE, MEG, methanol, and PP shipments that supply Asian textile chemical manufacturers...
Cotton, while less directly exposed, faces higher production costs through rising diesel and fertiliser bills...
The logistics cost spiral compounds the raw material shock, creating a triple squeeze on textile exporters across South and Southeast Asia...
The Cotton Textiles Export Promotion Council (TEXPROCIL) Chairman Vijay Agarwal has warned that the disruption will hurt India’s textile industry particularly hard given its sensitivity to seasonal delivery windows. Rerouting via the Cape of Good Hope adds 20–25 days to transit times, which would be a devastating delay for fashion-season shipments where a missed window can mean cancelled orders and markdown losses...
Near-term (0–3 months): Production costs have been projected to rise by 10–15 per cent globally, with polyester value chains absorbing the steepest increases...The reopening of the route for Indian shipments may partially stabilise feedstock supply to South Asian manufacturers, but volatility in energy prices, freight insurance, and shipping risk premiums is likely to persist. Brands are already accelerating nearshoring strategies towards Turkiye, Portugal, and Central America, while manufacturers continue stockpiling polyester granules and dyes where available.
Medium-term (3–12 months): Cotton may see renewed demand as a relative cost hedge against petroleum-derived synthetics, although its own production costs may rise due to higher diesel and fertiliser prices...
Long-term implications:...the crisis reinforces a structural shift towards regional supply chains, reduced reliance on single maritime chokepoints, and greater investment in domestic feedstock capacity....
...For an industry employing tens of millions across South and Southeast Asia, the implications extend far beyond balance sheets to the livelihoods of workers who produce the world’s clothing.