A catastrophic storm that battered Egypt’s northern coast on Wednesday 23 September left waist‑deep water across Sidi Gaber and submerged production halls at Delta Weaves, the sprawling garment complex that is home to NileTex Holdings’ flagship factory. NileTex said it was suspending all outbound shipments from the site after automated flood barriers failed and dozens of industrial looms were soaked by seawater that rose through drainage canals.
The company’s emergency note to investors said production would stop "until safety checks and full inventory assessments" were complete; it estimated the immediate loss of finished goods and damage to machinery at EGP 3.8 billion (about €106 million). Traders reacted fast: NileTex shares dropped 17% on the Cairo Exchange within an hour of the announcement.
Powering Egypt's export push
NileTex has been one of the country’s fastest‑growing exporters, supplying European fast and mid‑market labels and a smaller run of luxury orders for houses that stage autumn collections in Milan and Paris. One buyer at a European atelier, which had fast‑track orders printed and cut at Delta Weaves, said the factory’s output was scheduled to arrive in the EU next month and that retailers would now hunt for alternate suppliers.
"We saw the water roll across the shop floor in the middle of the night; the looms were still running — then they were under water," said Lester Luettgen, the plant foreman who led employees out of building C at 03:00. He said roughly 3,200 staff are directly affected, many of them living in nearby apartment blocks that were also flooded.
We saw the water roll across the shop floor in the middle of the night; the looms were still running — then they were under water.
Lester Luettgen, plant foreman
Markets and ministers react
Analysts said the hit to NileTex will be felt beyond one balance sheet. "A single large supplier collapsing at this point of the season forces brands to redirect orders to Turkey or South Asia at far higher freight and retooling cost," said Margaret Joly, an economist at the Cairo Institute for Industrial Policy. She warned that short‑term import substitution could push up clothing prices in European markets and squeeze foreign‑exchange inflows to Egypt.
Keith Hunt‑Turner, the trade ministry’s export chief, told reporters the government would offer urgent credit lines and fast‑track permits to alternative exporters in Damietta and Giza to meet standing contracts. "We will not let orders default; we are mobilising liquidity and port capacity within 72 hours," he said.
Insurance, clients and the clock
Insurers and legal teams joined the scramble. Joonatan Liimatainen, a regional underwriter for Mediterranean Marine Assurance, said policies on many industrial sites exclude "seawater intrusion from non‑fortified canals," which will force claims into arbitration. "Expect lengthy assessments and a sizeable gap between book value and pay‑out," he said. Buyers for Verité Atelier — a European fashion house that had a capsule made at Delta Weaves — confirmed they were negotiating transfer of work to a Turkish supplier and would withhold final payment until they could verify fabric provenance.
Company executives said a full restart could take up to four months if replacement looms are available; they warned that stalled shipments could reduce NileTex’s annual export revenue by EGP 9.6 billion (about €268 million) in the coming year if order cancellations cascade. Christof A. Bader, NileTex’s finance director, said the firm had opened talks with three local banks and two international lenders for a bridge facility, and that management would present a recovery plan at a special Cairo Exchange meeting on Friday.
Workers gathered outside the flooded gates on Wednesday afternoon, drying garments on wires and waiting to hear if pay would continue while assessment teams worked. "We came to work as usual and left with nothing but soggy jackets," said Sara López, a line supervisor who has worked at the plant for seven years. The trade ministry asked exporters elsewhere to report spare capacity by tomorrow evening so orders can be reallocated before the next shipping window.
