Full EU Carbon Tax Sparks Supply Chain Tension
The sharp rise in maritime freight costs is once again straining the supply chain in the Canary Islands. This time, the trigger is not a one-off blockage or an unexpected disruption, but the full implementation of the European Union’s Emissions Trading System (ETS) levy. Since the start of the year, the tax has been applied at 100% to maritime transport. The regulation began in 2024 with a 40% charge, rose to 70% in 2025, and has now reached its full application—a milestone the Canary Islands port sector views with considerable concern.
Immediate Impact on Freight Prices
The effect has been immediate. Shipping companies have already begun passing the new cost onto freight prices, with increases that, according to logistics operators and industry business leaders, could reach up to 40% on certain routes. This factor is compounded by a context of high international uncertainty, marked by open conflicts, geopolitical tensions, and constant changes to shipping routes, which is leading companies to bolster their cost forecasts. This price hike, they warn, will not remain at the docks and will ultimately filter through the entire commercial chain, directly impacting the shopping baskets of Canary Island residents.
“Any additional tax aggravates operational costs,” summarises José Mayor, president of Oneport Canarias, the business association grouping the Archipelago’s logistics operators and port services. The sector insists this is not an arbitrary business decision. “It is not the fault of the shipping companies,” emphasises the president of Fedeport, José Juan Socas. The problem, he adds, is that the Canaries do not compete on a level playing field. Their direct rivals are not other European ports—also subject to the ETS—but facilities in the African environment which remain outside the system and can offer cheaper services.
Threat to Competitiveness and Hub Status
This differential threatens to upset established balances. Both business associations and port authorities warn of the risk of traffic relocation, especially in an ultra-peripheral territory whose connectivity depends almost exclusively on maritime transport. “Our competitors are not European ports, they are emission-free ports,” insists Socas, who warns that a continued rise in freight costs could endanger the viability of certain shipping lines and the Canaries’ role as a hub port.
The president of the Port Authority of Santa Cruz de Tenerife, Pedro Suárez, acknowledges that this scenario was already anticipated. Even so, he assures that the battle is not considered lost. The port authorities, together with the Government of the Canary Islands, are working to ensure the European Commission takes into account the uniqueness of the ultra-peripheral regions. The goal is to secure an exception or a moratorium until there is a global framework for emissions reduction, rather than a partial application that penalises only European ports.
Building a Common Front in Europe
On this European front, the Canary Islands are not acting alone. The Archipelago’s port authorities are working with the regional government to create a common front with the rest of the EU’s Ultra-Peripheral Regions (RUP)—such as Madeira, the Azores, or French overseas territories—with the aim of exerting political pressure in Brussels. The strategy involves articulating a specific lobby to convey to the European Commission that the homogeneous application of the ETS has disproportionate effects on territories that compete directly with third countries and whose economies critically depend on maritime connectivity.
Effects Felt on the Ground
Meanwhile, the effects are beginning to be felt on land. Importers and distributors face higher costs, more uncertainty in arrival times, and the need to increase stock to avoid supply breaks. “There will be fewer containers, fewer ships, and more delays,” warns the president of the Emicela group, Sergio Arencibia, who paints a picture of increasingly fragmented routes, with multiple stops and transit times that have multiplied in recent decades. “In the 1990s, a route between Brazil and Las Palmas de Gran Canaria took nine days; 35 years later, it takes 35 days,” he states. All of this, he reminds us, ultimately translates into a more expensive shopping basket and greater difficulties for key sectors such as hospitality.
Red Sea Reopening and the Long-Term Challenge
In this context, the possible progressive reopening of Red Sea routes introduces a new adjustment factor. After months of mandatory diversions via the Cape of Good Hope, some shipping companies are cautiously beginning to resume passage through Suez. The impact, for now, is limited. “A slight decrease in traffic has been noted, but nothing drastic,” points out José Mayor, who speaks of a slow and still unpredictable normalisation. Socas agrees that the end of the conflict will return those temporary traffics that called at the Archipelago to their natural course, without that necessarily implying the loss of the Islands’ structural traffic.
Port authorities assume the Red Sea effect was temporary and that volumes will tend to stabilise at levels similar to those prior to the crisis. The real challenge, they agree, is not there, but in how to absorb the permanent impact of the ETS without losing competitiveness or making the cost of living in the Islands even more expensive.
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