A report by Panjiva states, clothes, shoes and accessories are lying idle in warehouses across the world as freight forwarders scramble to secure shipping containers. Boxes are being held up at US ports and air terminals, which have too few berths and healthy workers to process surging cargo volumes. As per the report, container shipping rates have more than quadrupled since early March with port congestion leading to lower than expected revenue from North America for brand Nike.
The struggle faced by manufacturers to keep up with demand for essential items like plastic fasteners and semiconductor chips is also delaying the production of finished goods, says the report. A licensor of brands like Calvin Klein and Dockers, G-III re-routed shipments from congested West Coast ports to the East Coast, where traffic is lighter.
Wholesale retailers have similarly borne the brunt of Nike’s shipping woes, as most of the brand’s delayed inventory was destined for multi-brand partners. Fast fashion and luxury brands that rely more on air freight might get some relief as international travel picks up.
