How rising costs threaten future of Icelandic sheep farming

Tough and resilient – the farmers in Iceland are much like the sheep they have bred to cope with the rugged terrain and sub-Arctic winter conditions.

But many, like 44-year-old Heida Gudny, say their businesses are simply not resilient enough to cope with rising input costs.

See also: Why milking robots are a good fit for Iceland’s dairies

She has been forced to sell her 500-head sheep flock in the face of hikes in feed and fertiliser prices.

Lamb returns have stagnated at about 8,000 krona (£47 a head), since 2017, failing to keep apace with these increased costs.

“Running a sheep farm is very hard, financially. The slaughterhouse still needs its share, so primary producers are taking the hit. It is always the same,” says Ms Gudny, who has been earning her living shearing and scanning to keep her 6,464ha (15,967-acre) farm afloat.

Despite sheep quotas being in place and farmers receiving payments for lamb, grassland and arable production, Ms Gudny says she did not have a lot of quota and was reliant on good lamb returns.

“I was getting 250,000 krona a month (£1,468). It is a very unstable time. The [lamb] price has stayed the same, but costs have gone up 10%.”

It is a sombre time for Iceland – where sheep have iconic status – with numbers at an all-time low of about 380,000, down from 900,000 in 1980.

Lamb is still the island’s primary dish, but domestic consumption has fallen from nearly 13,000t in the 1980s to just over…