Out of Their Shell

aurora abalone reykjanes

The Reykjanes peninsula is barren, even for Iceland. About two-thirds of it is covered by lava fields, nary a tree to be seen. The skyline stretches flatly in most directions, the mountains more modest than elsewhere in the country. The peninsula juts west into the North Atlantic, first in line to receive the low fronts […]

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Brim buys 10.83% of Iceland Seafood International

Golli. A Brim ship in Akranes, West Iceland

Icelandic seafood company Brim has bought a 10.83% share in Iceland Seafood International (ISI), RÚV reports. The purchase entails the entire share of Bjarni Ármannsson’s company Sjávarsýn in ISI. Bjarni is also the CEO of Iceland Seafood but is resigning from the position.

Even prior to the sale, Brim was one of Iceland’s largest and most profitable seafood companies. With this purchase, the company intends to strengthen its sales network in Europe. The sale was announced to the stock exchange last night, as both Brim and Iceland Seafood are listed on Nasdaq Iceland’s main market. Brim paid over ISK 1.6 billion [$11.7 million, €11 million] for the shares.

Sold for one thousand pounds after losses

Iceland Seafood has faced difficulties in operations recently. The company sustained considerable losses in the operations of its subsidiary Iceland Seafood UK, which was eventually sold to the Danish company Espersen for the small sum of one thousand pounds. Iceland Seafood’s loss in the first half of the year amounted to ISK 2.2 billion [$16 million, €15.1 million].

The share price in Iceland Seafood last weekend stood at ISK 5.3 [$0.04, €0.04] per share and had never been lower since the company went public four years ago. The price rose by 4.72% at the opening of the market this morning in a transaction worth ISK 22 million [$160,000, €151,000].

Brim to strengthen sales network

Iceland Seafood is one of the main exporters of seafood in Iceland and operates offices in seven countries in Europe, North America, and South America. According to Brim’s CEO Guðmundur Kristjánsson, this is exactly what Brim is looking for with the purchase. The goal is to strengthen Brim’s sales network, especially with regard to markets in Europe.

Bjarni Ármannsson will step down as Iceland Seafood’s CEO and will be replaced by Ægir Páll Friðbertsson, managing director of Brim.

43% of Iceland’s exported goods

The Icelandic seafood industry is one of the country’s key industries, employing around 7,500 people or approximately 3.9% of the workforce. The seafood industry contributes around 8% directly to Iceland’s GDP, but its indirect contributions are much greater. Marine products account for 43% of the value of Iceland’s exported goods.

Consolidated wealth

Just four companies hold around 60% of Iceland’s fishing quota: Samherji, Brim, KS, and Ísfélagið. In 2021, Brim reported profits of ISK 11.3 billion [$88.8 million; €82.9 million].

In a column published in Morgunblaðið last year, Minister of Fisheries Svandís Svavarsdóttir stated that the nation viewed the consolidation of fishing quota in so few hands as deeply unjust and that it felt that this collective resource was not distributed fairly.

Opposition MP and former Social-Democratic Alliance Chairman Logi Einarsson pointed out that the wealth in the fishing industry was leading to accumulated assets in unrelated sectors, such as the media, real estate, transport, grocery stores, energy, and even insurance and banking.

Icelandic State Must Pay Compensation for Misallocating Quota

The Icelandic state must compensate seafood companies Vinnslustöðin and Huginn due to the misallocation of mackerel quota from 2011 to 2018, RÚV reports. The state has been ordered to pay ISK 1 billion [$7.1 million, €6.6 million] plus legal costs of ISK 25 million [$178,000, €166,000]. Vinnslustöðin CEO Sigurgeir Brynjar Kristgeirsson says the state could have avoided the expense by negotiating directly with the company but showed no interest in doing so.

“We were pioneers in this mackerel fishing, we found the mackerel and utilised it, and in legislation, it simply says that those who start and who find the fish, should get a larger portion when it comes to allocation and setting quota,” Sigurgeir stated. Both the Parliamentary Ombudsman and the Supreme Court of Iceland came to the same conclusion. “The conclusion was that it was taken from us and given to others, who hadn’t contributed from the beginning.”

The Reykjavík District Court ruled in favour of the seafood companies in the case on Monday morning. Seven companies had originally submitted the claim for damages but five withdrew their lawsuits.

The mackerel quota which the case addresses was allocated by then-Minister of Fisheries Jón Bjarnason in 2010. Rather than allocating the entire quota to those who had experience, some was allocated to small boat fishermen and others in a pool for mid-size ships. Many immediately cast doubt on the legality of the allocation and the Supreme Court ruled that the state had broken the law: only those with previous experience fishing mackerel should have received quota.

Growing profits in few hands

During the height of the coronavirus pandemic, the seven companies who had initially sued were criticised by government officials for demanding ISK 10 billion in compensation from government coffers in the midst of a recession. As a result, five of the seven companies dropped their cases in 2020.

In a Facebook post about this week’s Reykjavík District Court ruling, Minister of Finance Bjarni Benediktsson confirmed the state would appeal. If the seafood companies were to win the case, Bjarni added, he asserted that the compensation would be extracted from the seafood industry rather than taxpayers (presumably through raising taxes on seafood companies or similar measures).

The profits of Iceland’s 10 largest seafood companies grew by 50% in 2019 and continued growing throughout the pandemic, with the price of fish rising dramatically in the wake of the Russian invasion of Ukraine. Vinnslustöðin bought Huginn in 2021 and is among Iceland’s ten largest seafood companies. Just four companies hold around 60% of Iceland’s fishing quota, which has sparked debate on the distribution of wealth in recent years.

Icelandic Fish Beer a Hit at Seafood Expo Global

A beer made with Icelandic capelin roe, or masago, was a hit at the Seafood Expo Global conference that took place in Barcelona, Spain April 25-27, mbl.is reports. Produced by Icelandic Asia, the beer is brewed with masago and shiso, a Japanese herb.

The beer was first introduced at the conference last year, but the shiso in this year’s batch is a new addition. “It was a hit last year and we decided to make a new version of it for this expo and it’s been a hit too,” stated Agnes Guðmundsdóttir, Icelandic Asia’s director of sales. The beer’s logo was designed by AI and the cans featured a QR code that drinkers could scan to win prizes and merchandise from Japan. Last year’s Masago Beer is pictured in the post below.

Masago is a popular ingredient in Asian cuisine, including sushi. The Masago Beer was specially brewed for the event and is not for sale elsewhere. Readers craving an Icelandic drink with a fishy ingredient can try Collab, a caffeinated soda with fish collagen that has become popular in Iceland in recent years.

Amendment Not Sufficient to Encourage Tuna Fishing

Efforts to encourage Icelandic fisheries to make use of Atlantic bluefin tuna catch quotas allotted to Iceland have yet to prove fruitful. While tuna goes for high prices, specialised ships are necessary to make tuna fishing profitable. Chartering foreign boats to develop tuna fishing experience within the Icelandic fishing industry would require authorisation from the International Commission for the Conservation of Atlantic Tunas, Fiskifréttir reports.

Last summer, Parliament passed a provisionary article allowing Icelandic fisheries to charter foreign ships to fish for bluefin tuna. While now permissible by Icelandic laws, fishing Iceland’s quota with foreign ships is in conflict with the International Commission for the Conservation of Atlantic Tunas’s resolutions and the amendment is therefore meaningless unless ICCAT makes revisions to their regulations.

“The change was necessary but not sufficient to clear the way for tuna fishing with foreign chartered ships,” the Ministry of Food, Agriculture, and Fisheries stated to Fiskifréttir. “ICCAT statutes state that such chartering is prohibited. Therefore, ICCAT’s statutes would have to be altered for such chartering to take place, even if Icelandic legislation has nothing standing in its way.” According to the ministry, the change to legislation was made at the request of Fisheries Iceland.

The Ministry also noted that if no suitable application from an Icelandic ship reaches the Directorate of Fisheries by June 1, the Ministry will look into selling a part of Iceland’s permissible catch quota to cooperating states within ICCAT under ICCAT regulations.

Since Iceland joined ICCAT in 2002, it’s been issued 1292 tonnes of quota, but only 80-90 tonnes of this valuable fish have been caught in that time, and that’s including both direct fishing and tuna bycatch. While the tuna has been intermittently caught by Iceland’s shores, in order for tuna fishing to become profitable, fisheries would need to invest in specially equipped freezer trawlers capable of freezing the tuna at much lower temperatures than current ships allow.

If Iceland continues not to use its tuna catch quota, other nations or interested parties might well make a claim to it, such as Norway or the European Union, as tuna quota is in high demand. The hope is that if an Icelandic party can charter foreign tuna boats, they might establish the know-how and experience of this highly-specialised type of fishing, which could eventually lead to Icelandic fisheries investing in tuna fishing ships.

Net Profit

In 2021, when a lower capelin quota was issued in Iceland than had been anticipated, Landsbankinn bank lowered its GDP growth forecast for the year from 3.4 to 3.3%. Capelin may be a little fish, but as a key food source for many other marine species, it makes a big impact on Iceland’s economy and ecology. Commercially, capelin is one of the most important fish stocks in Iceland, accounting for around 13% of export earnings. Only cod brings in more, and it bears pointing out that cod is also dependent on capelin, which may account for up to 40% of its total food. 

Stocks of capelin in Icelandic waters have been volatile, making it difficult to predict or plan fishing seasons. The fish have a short life cycle, procreating only once before their ultimate demise, which makes the stock vulnerable to overfishing and changes in the marine environment. In 2019 and 2020, in accordance with the recommendations of Iceland’s Marine Research Institute, no capelin quota was issued at all, while last year’s catch amounted to nearly 600,000 tonnes. In recent years, however, capelin catch has averaged around 350,000 tonnes annually. The bulk of the quota is caught during four weeks in spring.

Capelin is often described as the most ecologically important fish species in Icelandic waters. It is the main source of food for Atlantic cod (another commercially important species in Iceland), and is also a food source for whales, seals, squid, mackerel, and seabirds.

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Icelandic boats began fishing capelin in the late 1960s when herring stocks in Icelandic waters collapsed.

 

Net Profit

Capelin is a small forage fish belonging to the smelt family and is found in the North Atlantic, North Pacific, and Arctic oceans. It is silver in colour and usually measures between 15-18 cm long [6-7 in].

Golli. A Brim ship in Akranes, West Iceland

About 80% of capelin caught in Iceland is used to produce fishmeal and oil, while a small amount (less than 20%) is used to produce roe for human consumption. The roe, called masago, is yellow in colour and is popularly used in sushi. 

Net Profit

Icelandic fishing boats caught some 477,000 tonnes of capelin last season, the full quota issued. This included around 20,000 tonnes of roe. The total value of the catch is estimated at around ISK 42-45 billion [$305 million, €280 million].

Up until the early 80s, Icelanders sometimes caught over a million tonnes of capelin in a single season. 

Net Profit

Despite being common in Icelandic fishing nets, capelin is not normally sold in local stores. Hólmgeir Einarsson, a seafood store owner in Reykjavík, decided to stock some this year and has so far sold over 200 kilos [440 lbs]. He says the primary purchasers have been immigrants, who are familiar with the fish from abroad. Some Reykjavík restaurants are also discovering this important fish.

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Icelandic capelin migrate seasonally. In spring and summer, they go north of the Icelandic mainland to feed in the plankton-rich waters between Greenland, Iceland, and Jan Mayen.

Net Profit

Due to rising sea temperatures, capelin has moved further north in search of colder waters. Young capelin now tend to dwell near and under the sea ice around Greenland, making stock sizes difficult to assess.

Climate change and changes in the ocean’s temperature have a direct effect on capelin behaviour. It’s one of the most direct effects of climate change Icelanders can expect in the coming years.

Net Profit

Tubs of roe ready for export.

The capelin season takes place in February and March. The window to catch roe-filled capelin before it spawns is even shorter, only around 20-25 days. In that time, a sailor on a capelin fishing boat can expect to earn an Icelandic worker’s annual salary. That is, if capelin catch quotas, and the weather, are favourable that year.

Net Profit

The capelin season takes place in February and March. The window to catch roe-filled capelin before it spawns is even shorter, only around 20-25 days. In that time, a sailor on a capelin fishing boat can expect to earn an Icelandic worker’s annual salary. That is, if capelin catch quotas, and the weather, are favourable that year.

Ólafur Örn Ólafsson, restaurateur at Brút in the Reykjavík city centre, occasionally serves roe-filled capelin.

Fishing Industry Parties Sign 10-Year Collective Agreement

Fish processing workers preparing salt cod

Four seafood industry unions signed a 10-year collective agreement with Fisheries Iceland (Samtök fyrirtækja í sjávarútvegi, or SFS) last night. The new agreement emphasises wage hikes in line with those of the Federation of General and Special workers in Iceland (SGS), a rise in pension contributions, and increased safety and health for workers. Workers will vote on the agreement in the coming weeks, but negotiators on all sides have expressed satisfaction with the outcome.

On the Icelandic labour market, collective agreements are often negotiated for 2-3 year periods. According to Vísir, the newly-signed fishing industry agreement could be the longest in Icelandic history. Four unions are signatories to the agreement with SFS: the Association of Shipmasters (Félag skipstjórnarmanna), the Seamen’s Association of Iceland (Sjómannasamband Íslands), the Seamen’s and Engineers’ Association of Grindavík (Sjómanna- og vélstjórafélag Grindavíkur) and the VM Association of Engineers and Metal Technicians (VM Félag vélstjóra og máltæknimanna).

The last collective agreement between these parties expired three years ago, and previous negotiations, last held in 2021, proved unsuccessful. The parties began negotiating again at the start of this year and now have an agreement to show for it. Chairman of the Seamen’s Association of Iceland Valmundur Valmundsson said the mood among negotiators was positive and called the agreement a watershed for workers in the industry, which ensured wage hikes in line with hikes on the general labour market as well as better pension benefits. The agreement also establishes a special safety committee to increase emphasis on the health and safety of workers at sea.

The Icelandic seafood industry is one of the country’s key industries, employing around 7,500 people or approximately 3.9% of the workforce. The seafood industry contributes around 8% directly to Iceland’s GDP, but its indirect contributions are much greater. Marine products account for 43% of the value of Iceland’s exported goods.

MATEY Seafood Fest Serves Up the Best of the Westman Islands

A new festival seeks to celebrate the produce and producers of Iceland’s Westman Islands. The MATEY Seafood Festival is a collaborative project between the island’s restaurateurs and food producers and will take place from September 8-10.

Restaurants, fish factories, food producers and other food industry service partners collaborate to highlight the food of the islands. With the MATEY festival, islanders hope to spotlight “one of the best culinary destinations in Iceland,” and give guests a taste of “a variety of stunning dishes” that are made solely with ingredients sourced in and around the Westmans. Leading chefs from neighbouring Nordic nations will also take part in the festival, offering their own twists on “authentic local dishes.”

Restaurants Gott, Slippurinn, Einsi Kaldi, and Næs will host menus from guest chefs Chris Golding, Leif Sørensen, Ron McKinlay, and Fjölla Sheholli and Junaid Juman, respectively, serving up local ingredients.

In addition to serving up local cuisine in Heimaey’s restaurants, the festival will also feature events in which businesses in seafood industry open their doors, give some insight into their operations, and discuss the “blue economy” that is so vital to the Westmans’ way of life.

Namibian Officials Visit Iceland And Discuss Fishrot Files

Netumbo Nandi-Ndaitwah and Þórdís Kolbrún Reykfjörð Gylfadóttir

Namibian officials, including the country’s Deputy Prime Minister, visited Iceland this week and discussed the case of Icelandic seafood company Samherji’s allegedly questionable business practices in Namibia, Stundin reports. The District Public Prosecutor confirmed to Vísir that he has met twice with those in charge of investigation and prosecution and states that the investigation is progressing nicely.

Read more: The Fishrot Files

Two and a half years have passed since Kveikur, Stundin, and Al Jazeera Investigates cooperated with Wikileaks to shed light on what’s known as the Fishrot Files. In that media coverage, whistleblower Jóhannes Stefánsson alleged that Samherji committed bribery and tax fraud in relation to their fishing operations in Namibia.

“We’ve acquired a considerable amount of data, and we’re working our way through that data and conducting interviews, although COVID-19 has hindered us in getting meetings, mostly abroad. We’ve been working on fixing that over the past few days,” District Public Prosecutor Ólafur Þór Hauksson told Vísir, confirming Stundin’s report that Icelandic investigators had met with their Namibian counterparts in the Hague last week to coordinate their efforts. Meetings have continued in Iceland over the past few days.

“Most recently, there have been meetings with the parties investigating and prosecuting these cases n Namibia, and we needed to go over the situation of the case there. I can’t disclose the content of the meetings but will confirm that the meetings have taken place and been very productive.”

Icelandic citizens cannot be extradited to Namibia

Deputy Prime Minister of Namibia Netumbo Nandi-Ndaitwah is in Iceland along with Namibia’s Anti-Corruption Commission (ACC) Deputy Director-General Erna van der Merwe and Prosecutor General Martha Imalwa. The reason for their visit is to meet with the Icelandic investigators on the case as well as Icelandic ministers. After their meeting with the Minister of Justice’s assistant Brynjar Níelsson, he confirmed to Stundin that Namibian authorities had extended no official extradition request. Namibian investigators have asked that Namibian judicial authorities issue such a request, as extradition is a prerequisite for prosecution. No extradition treaties are in place between Namibia and Iceland, and according to legislation, Icelandic citizens can not be extradited.

When asked if it was normal for an investigation to take such a long time, Ólafur stated that it’s possible when the case is extensive. “In that case, this can take a long time in Iceland and abroad. I will point out, in this context, that Namibian investigators started looking into the issue long before 2019. I believe it was in 2015 that they started looking into it.”

Ólafur would not issue a timeframe for prosecution but repeated that the investigation was progressing satisfactorily.

Four Working Groups to Overhaul Iceland’s Fisheries Legislation

Svandís Svavarsdóttir

Minister of Food, Agriculture, and Fisheries Svandís Svavarsdóttir has appointed four working groups to analyse challenges and opportunities in Iceland’s fisheries sector and related sectors, as well as to assess the macroeconomic benefits of the existing fisheries management system. The four groups have the task of producing new legislation on fisheries management, possibly a complete overhaul of existing legislation that governs the sector, according to a government notice.

“With regards to the fishing industry, there is a deep feeling of injustice among the public,” Svandís wrote in a column in Morgunblaðið this week. “I think that feeling stems mainly from two things; the consolidation of quota and the feeling that the profits from the shared resource of the people are not divided fairly. The aim of this work is therefore efficient and sustainable utilisation of marine resources in harmony with the environment and society.”

Read More: Fishing Industry Profits Spark Wealth Distribution Debate

The four groups have until the end of 2023 to complete their assignments, which Svandís stated will result in new comprehensive legislation on fisheries management or new legislation on marine resources. Other stated aims are projects in the fields of energy transition, innovation, and marine research, as well as transparency and mapping of ownership in the fisheries sector.

The fishing industry has profited greatly in recent years, sparking debate on whether quota fees or taxes in the industry are high enough to ensure its winnings are fairly distributed. Four companies hold 60% of all fishing quota in Iceland: Samherji, Brim, KS, and Ísfélagið.