Hormuz conflict strains polyester and spandex supply for fast fashion
Fast fashion brands are feeling the heat as the Strait of Hormuz conflict messes with oil supplies, meaning polyester and spandex (the stuff most trendy clothes are made from) just got harder to source.
With panic buying, Tongkun Group Co. a major polyester producer, expects net income to triple from a year earlier in the six months through June, but others aren't so lucky.
China fiber production drops, prices spike
Synthetic fiber production in China has dropped sharply, and prices for materials like polyester have spiked.
Some brands, like Zara and H&M, derive their polyester from recycled materials, while Uniqlo's reliance on new synthetics leaves it more exposed.
On top of that, logistics costs keep climbing and cotton prices hit a two-year high thanks to tight inventories, making it tougher for fast fashion labels to keep up with demand.