UK goods worth £3bn at risk from supply chain ‘havoc’ in Red Sea, warns Russell Group

Around £3bn of UK goods are at risk of being delayed over the coming months by ongoing supply chain disruption in the Red Sea, with little sign that geopolitical tensions will ease up, warns Russell Group.

The analysis is based on goods imported into Felixstowe from June 2023 to September of that year. This time of year is a key period for retailers as they stock up for Christmas. Russell Group said that retailers in Europe are trying to stock up on key items earlier than usual to avoid shortages during the autumn and winter months.

It estimates that the following amount of UK commodities are at risk if disruption in the Red Sea continues or escalates in the next few months.

• Preserved fruits and vegetables (£424m)
• Clothing (£403m)
• Pharmaceuticals (£376m)
• Household appliances (£211m)
• Meat products (£193m)
• Textiles (£192m)
• Furniture (£175m)
• Wine (£141m)
• Perfumes and cosmetics (£137m)
• Soft drinks (£78m)

Russell Group said supermarkets, retailers and fashion, and cosmetic brands all face being impacted by “significant” delays.

Supermarkets topped the list with a potential exposure of £1bn, the research shows. Brands including Tesco, Sainsburys, Asda, Morrisons, Iceland, Waitrose, Aldi, Lidl and Iceland are all likely to be impacted.

Retailers face up to £381m in exposure, with many UK high-street brands including John Lewis, Marks & Spencer, Currys, Poundland, Boots, Next, Argos, Selfridges, Costco and Argos set to be impacted.

UK and global fashion and cosmetics brands – such as Chanel, Ted Baker, Burberry, Barbour and Capri Holdings – have a combined exposure of £214m to the delays and supply chain disruption.

Suki Basi, managing director of Russell Group, said: “The crisis in the Red Sea is playing havoc with global supply chains, causing delays in shipping and higher shipping rates, all of which are adding to backlogs at ports. It is no surprise that many UK companies have issued profit warnings ahead of quarterly earnings.”

“There is little chance of today’s storm-filled political climate easing up in the coming months, with many shipping companies expecting the disruption to continue for a long time. Expect more uncertainty going forward, and at the same time, mitigatory action through insight and analysis,” he added.