Power and gas shortages have emerged as a fresh threat to Bangladesh’s apparel exports, with international buyers shifting parts of their sourcing to competing countries over fears of production and shipment delays.
Industry leaders warn that the impact may surface in export figures within three to six months as reduced orders translate into lower shipments.
The concern is no longer only weak demand in major markets. Buyers are increasingly questioning whether Bangladeshi suppliers can deliver on time amid recurring gas and power disruptions.
Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) President Mohammad Hatem told TIMES that many knitwear buyers were shifting up to one-third of their orders to other countries over concerns about production disruptions and delivery delays.
“The disruption at the FSRU and statements from two ministers seeking two years to resolve the gas crisis have shaken buyers’ confidence,” he said.
The threat comes just as Bangladesh’s apparel exports have returned to growth after a difficult fiscal year.
Apparel exports fell 2.82 per cent in the 2025-26 fiscal year before rebounding 5.12 per cent in the first two months of the current fiscal year despite severe energy shortages.
Bangladesh Garment Buying House Association (BGBA) President Md Abdul Hamid said the energy crisis had hit buyer confidence just as the global apparel market was slowing.
Although European apparel demand has declined, Bangladesh has also lost market share, indicating that some sourcing is moving elsewhere, he said.
Hamid said his French clients, including Carrefour and Coopérative U, had reduced orders, with Coopérative U cutting purchases by 35 per cent from a year earlier.
“Large buyers are reducing orders by some percentage points. The concern is not shifting orders between factories in Bangladesh but losing portions of those orders to other countries,” he said.
Two senior executives at the Dhaka offices of major European buyers, speaking on condition of anonymity, confirmed that brands were reducing orders partly because of weaker market conditions and partly to diversify sourcing to ensure uninterrupted supply.
They cautioned, however, that overall reductions by major brands were unlikely to be as steep as those reported by some individual factories.
The pressure appears stronger in Europe.
Data from major markets show Bangladesh underperforming several competitors. US apparel imports fell 8.65 per cent in the first six months of 2026, while imports from Bangladesh declined 6.5 per cent. Vietnam and Pakistan recorded smaller declines, while Indonesia and Cambodia posted growth.
Eurostat data compiled by Bangladesh Apparel Voice showed European Union apparel imports fell 9.7 per cent in the first half, while imports from Bangladesh recorded the largest decline in value terms, dropping more than 16 per cent year on year.
The energy crunch is hitting the primary textile sector particularly hard, disrupting the domestic supply chain and raising manufacturers’ costs. Yarn prices have risen by 50 cents in less than two months.
Former Bangladesh Textile Mills Association (BTMA) Vice-President and NZ Tex Group Managing Director Md Saleudh Zaman Khan said his fabric mills had orders but could meet only around two-thirds of apparel exporters’ demand because of production disruptions.
“Without using expensive alternative fuels, supplies would have fallen below half,” he said.
“As a responsible and reputed supplier, we are spending more to continue supplies but still failing.”
Irregular gas and electricity supply is also causing quality problems and higher wastage at dyeing units, he said.
“Against monthly orders of 6-7 million tonnes, we are supplying only 4 million tonnes. Buyers have to either wait or source from elsewhere. Both options are time-consuming and costly,” Khan said.
“The buyers’ natural response will be to look elsewhere in such a situation.”
He warned that unfinished orders could create a longer-term problem if global brands such as H&M, Uniqlo, Geo Jeans, Muji, Basta and Levi’s lose confidence in local suppliers.
“We may end up with dry production floors even after the energy situation improves,” he said.
The strain is already showing in order books.
BKMEA Director and Knit Syndicate Managing Director Md Abdul Hannan said four of his major European buyers had cut orders by 15-35 per cent year on year for the next spring and summer 2027 seasons.
“Initially, they cited market slowdown. Later, I learned that the buyer with the biggest cut shifted a large portion of orders to an Asian competitor,” he said.
Hannan said nearly half of knitwear exporters were facing shipment delays and struggling to negotiate with buyers.
“Shipment delays mean suppliers have to bear the cost of urgent air freight or offer discounts. Not all buyers are willing to accept this because they need certainty in delivery timelines,” he said.
His Nordic buyers had previously raised concerns about political uncertainty, which exporters could address, but were now seeking assurances over shipment schedules that suppliers could not provide, Hannan said.
Of about 550 active BKMEA-member knitwear exporters, only around 50 were in a strong position because of their scale and financial strength, while the rest were struggling to maintain capacity utilisation, he added.
Buyers are responding by testing alternatives.
China is attracting some orders despite higher costs because of its ability to ensure timely shipments. India is also positioning itself for more business through its free trade agreement with the European Union, although its apparel ecosystem remains smaller than Bangladesh’s.
A Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Director who heads a major apparel export group said buyers had been asking since the FSRU disruption and liquefied natural gas shortages whether suppliers could maintain delivery schedules.
He said buyers were shifting parts of their orders to India, Egypt, Indonesia and Cambodia.
BGBA President Hamid said buyers were also assessing changes in global trade, particularly India’s upcoming free trade arrangements with Europe.
“When Bangladesh faces production disruptions despite having a strong production base and supply chain, buyers naturally test alternative sources by shifting a portion of their orders,” he said.
“It will not become a major problem if the energy situation improves as the government has assured.”
Bangladesh Chamber of Industries President Anwar ul Alam Chowdhury Parvez said global uncertainty had already caused an organic slowdown in orders, which Bangladesh’s domestic problems were compounding.
The former BGMEA president said he was aware of brands shifting portions of their sourcing to India, Vietnam, Cambodia, Indonesia and Morocco, with some indicating double-digit reductions in sourcing from Bangladesh.
Like Hatem, he fears a double-digit decline in shipments could emerge within three to five months unless the situation improves.
Not every segment is suffering equally.
Energypac Fashions Chairman Humayun Rashid said woven apparel exporters were less affected because many relied on imported fabrics, while high-value products were also in a stronger position.
Woven exporters focused on the US market also expect stronger demand, which could partly offset weakness in knitwear and denim.
A senior official at a leading woven garment exporter, which sends around 90 per cent of its products to the US market, said orders for the next spring and summer seasons had only begun and exporters still had nearly two months to secure business.
His company has recorded double-digit year-on-year growth in every month this year.
Cuts by some buyers were being offset by increased orders from others, he said, although it was too early to determine whether the wider industry would see the same pattern.
Some US buyers were also exploring smaller regional sourcing markets amid continuing geopolitical disruptions, he added.
