KARACHI: Foreign buyers could defer or shift Pakistani export orders as Middle East shipping disruptions raise freight costs and make deliveries less predictable, textile industry representatives said Thursday, warning of growing risks to overseas sales.

The US-Iran war, which began in February, has disrupted shipping through the Gulf. Separately, threats from Yemen’s Houthi movement in the Red Sea have prompted carriers to divert some services from the Suez Canal, the shortcut between Asia and Europe, around southern Africa.

For Pakistan’s textile industry, which industry representatives say earned about $18 billion in exports in the financial year ended June, the disruption raises both the cost of importing manufacturing inputs and the final price buyers pay for delivered goods. Delays are particularly damaging for clothing and home textiles ordered against fixed retail schedules.

“Buyers are becoming increasingly cautious about delivery commitments and landed costs,” Kamran Arshad, chairman of the All Pakistan Textile Mills Association (APTMA), told Arab News.

“Orders are at risk of being deferred, reduced or shifted to competing sourcing destinations, especially countries with major transport and logistics hubs, where freight costs are lower and shipping schedules are still much more reliable,” he said.

Arshad identified India, Bangladesh and China as competing suppliers and warned that prolonged disruption could influence buyers’ future sourcing decisions. He did not quantify orders already lost or diverted.

Citing textile exporters’ data, he said freight charges for Karachi-to-New York shipments had risen from around $2,000 to as much as $9,000 per container, an increase of 350 percent. Rates for China-to-Pakistan shipments had increased from $2,000–$2,400 to $4,000–$4,500.

Those figures describe exporters’ reported rates on particular routes, rather than an average increase across Pakistan’s trade.

“Freight costs have increased very sharply since the disruption,” Arshad said.

Interloop, a Pakistani manufacturer supplying global brands including Nike, Adidas and Puma, also reported higher freight charges and less reliable schedules.

“International freight rates have increased significantly since 28 February, with the impact varying by route and carrier,” Humayun Javed Khan, the company’s senior general manager for external affairs, told Arab News.

Khan said transit times to the US East Coast had increased from around 28 days to 40–42 days. However, he said the company had not seen foreign order cancelations.

“Some shipments were delayed due to the non-availability of containers for forwarders,” he said.

Interloop sells most exports on a free-on-board basis, meaning buyers generally arrange and pay for the main sea journey once goods are loaded aboard. Khan said customers were therefore absorbing the higher international freight costs.

LONGER ROUTES, HIGHER COSTS

Syed Tahir Hussain, secretary-general of the Pakistan Ships Agents Association, said voyages diverted around the Cape of Good Hope were taking an additional 15–20 days.

“Naturally, when you are going through longer routes, your fuel, your bunker has also increased, then your insurance premiums have increased, your different overhead costs are increasing,” he said, referring to marine fuel and other operating expenses.

Disruption varies by carrier and route.

Maersk’s September adviseries described restrictions and additional charges for affected Gulf shipments, while accepting some cargo through ports including Salalah in Oman. The company and Hapag-Lloyd also announced a limited return of selected services to the Suez Canal, rather than a general restoration of their network.

Pakistan’s government is examining whether a dedicated container vessel could improve exporters’ shipping connections.

“The government can either purchase or lease a vessel, but it will be conditional to the availability of guaranteed cargo volumes,” Maritime Affairs Ministry spokesperson Muhammad Arshad told Arab News.

“The guarantee should come from exporters who will have to ensure the availability of the required cargo volumes for the vessel,” he said.

The proposal remains conditional. The government has not announced a purchase or lease, proposed routes or a timetable for starting the service.