Iceland at the Crossroads: A New Era for Sustainable Fish Production

Iceland is poised for significant change in its fishing industry as the country prepares to vote on resuming European Union (EU) negotiations later this year. This decision could have far-reaching implications for the nation’s fishing sector, which plays a vital role in the global fish market.

Iceland, despite its small population, accounts for approximately 1.1% of the world’s wild-caught fish. In 2024, Iceland’s fishing fleets caught over 994,000 tons of fish, a notable decrease of 28% from the previous year, mainly due to a lack of capelin catch, as reported by Statistics Iceland.

The fishing industry is a cornerstone of Iceland’s economy, contributing about 12% to the total gross domestic product (GDP) and employing approximately 7% of the population, according to the Government of Iceland. As Sigrid Merino Sardà, CEO of Iceland Responsible Fisheries (IRF), stated, “The Icelandic fishing industry has always been vital for the Icelandic economy.”

A Crucial Decision Ahead

This year, Iceland faces a pivotal referendum in August regarding EU membership. This decision comes more than a decade after a previous attempt to join the EU failed in the wake of a banking crisis in 2009, according to Reuters.

Central to this debate is the fishing industry. Currently, foreign vessels operate in Icelandic waters but under national laws and regulations. Merino Sardà emphasized that Iceland recognizes the potential need to revise its fishing policies if it chooses to join the EU.

The fishing and fish processing sectors are experiencing challenges, with net profits falling from 25% in 2023 to just 16% in 2024. The profitability of fishmeal and fish oil processing plummeted dramatically, dropping from 48% to 10.6% during the same period, according to Statistics Iceland.

Sustainability and Traceability: Iceland’s Commitment

Iceland has a robust history of addressing sustainability and traceability within its fishing industry. The IRF offers two key certifications: one focused on management practices and another on the chain of custody, all administered via third-party bodies.

Since the passage of the Law on Scientific Conservation of Continental Shelf Fisheries in 1948, Iceland has developed a scientifically-informed quota system aimed at curbing overfishing by adjusting quotas annually, according to Merino Sardà.

Merino Sardà pointed out that Iceland’s geographically small area allows for effective traceability. Under Icelandic law, all fishery catches are monitored by the Directorate of Fisheries to ensure that quotas are adhered to, deterring bycatch. “The traceability of these fisheries is quite straightforward,” she noted, emphasizing its importance to the economy.