Global retailers in the apparel, household staples, and white goods sectors are confronted with increased risks due to disruptions in freight movement caused by attacks on ships in the lower Red Sea by Iran-backed Yemeni militants. Some shipping companies are contemplating longer voyages, potentially leading to extended wait times and higher prices for goods. S&P Global identifies consumer goods, apparel, and chemicals as sectors most affected by shipping route disruptions between Europe, the Middle East, and Asia. The Suez Canal, accounting for about 12% of global maritime traffic, is crucial for major retailers like Walmart, H&M, and Target. Extended disruptions could particularly impact the consumer goods sector. Fast-fashion companies relying on imports from Asian textile mills, such as H&M and Zara-owner Inditex, face heightened risks. Some companies are exploring intermodal transport as an alternative to navigate challenges in shipping routes.

SOURCE:GOOGLE