Iceland's CAP dilemma

Voting intentions are on a knife edge as Iceland heads for its referendum on whether even to restart talks with the EU on membership.  Security and economics are drivers for change and the future of the fishing industry is vital.   However, agriculture is also a key issue.

Farming is ingrained in the Icelandic sense of national identity — in the 1970s there were about three sheep for every person — but it has been in decline. In the early 2000s, farms shuttered, young people moved to Reykjavik for higher-paying jobs and immigration surged. The number of humans overtook sheep in 2021.

“A hundred years ago, almost all people in Iceland were either fishermen or farmers,” according to Steinthor Arnarsson, a sheep farmer located in Burdardalur, northwest Iceland, whose family have been sheep farmers “all the way back”.

There has been talk of driving tractors into Reykjavik in protest. “If we’re going to become European farmers we should start acting like them,” Arnarsson joked to the Sunday Times.

Their main concern is that joining the single market will leave farmers priced out by cheap goods from the EU. They also fear that there will end up being fewer, bigger farms, consolidated around the capital, leaving rural communities diminished.

Others argue that EU subsidies would mean Icelandic farmers end up benefiting, and that membership of the bloc could also help to improve crumbling infrastructure in the country. Potholes are regularly mentioned.

Herdis Gunnarsdottir owns a dairy farm in Egilstad in the remote east of Iceland. She fears that her farm, with 80 cows (“big for Iceland”) won’t be able to compete with milk from industrial farms in the Netherlands, for example.   But transporting milk from the Netherlands to Iceland would be expensive, and Icelanders might prefer their home product.