Fisheries impacts

Historically, agriculture and fisheries has been the mainstay of the economy; sheep farming and cod fisheries as the fundamentals. The importance of fisheries increased considerably during the 20th century, which enabled the nation to develop from a poor agricultural country to a prosperous modern society. The fisheries’ significance and their dominant influence on the economy was, however, vulnerable to fluctuations in fish prices internationally and the condition of domestic fish stocks.

Around the turn of 21st century, the importance of the fishing industry declined considerably, not because of direct fall in fisheries themselves, but rather as the result of a rapid growth in the service and production sectors, such as financial intermediation, software design and aluminum manufacture. Diversification in the economy increased with further development from primary production, a similar process as known to occur in other developed countries. The export of fish products still weighs considerably in the nation’s foreign currency earnings, the following are the 2008 numbers; 37% of merchandise exports, roughly 26% of total exports and 8% of GDP.

In 2008 the total catch in Icelandic waters was close to 1.3 million tonnes of fish products worth ISK 171 billion; EUR 1.4 billion in export value. At the same time, the nation’s total population was 319,000 people and the workforce 178,600. The fishing industry employs 4.1% of the total workforce; fishing 2.4% and fish processing 1.7%. Although not visible from the aforementioned numbers, the fishing industry is fundamental for the whole economy and the country’s regional development. Fisheries and fish processing companies constitute the most important source of livelihood in coastal communities, where employment opportunities are often more limited because of less economic diversification.

Profitability and efficiency within the fishing sector have risen substantially, especially because of improved technology, both in processing and harvesting; the use of fully automated processing with latest computer technology is widespread in the industry. Improvements and innovations in transportation and logistics have increased efficiency as well; the use of temperature controlled containers, better storage boxes and readily available refrigerated warehouses. The availability of air cargo capacity has also greatly increased, supporting a huge rise in the export of chilled fish products.

Several auxiliary companies have developed as an offspring of the fishing industry, providing support services and products. Some of those supportive businesses have successfully exported their innovations and expertise globally, e.g. in fishing technology, fish processing machinery and the marketing of seafood products.

The international success of Icelandic fish products can be directly attributed to their quality and freshness. Producers are market-oriented, and the industry has been flexible to changes in demand and responded to them quickly, supported by the ITQ quota system. Production is carried out in accordance with HACCP requirements and other high hygiene and cleanliness standards.

Icelandic fish products are supplied to all major international markets, and today the spectrum of products supplied by Icelandic companies is much broader than ever before, ranging from catch-fresh raw materials to highly processed convenience products. Traditional processing techniques, such as salting, have been to a large extent replaced by fresh and frozen products.

Hörður Sævaldsson, University of Akureyri