Sheep farmers in Iceland can expect subsidies this year, which in total will amount to over five billion krónur, but not without conditions, RÚV reports. At stake is striking a balance between not overproducing and thereby devaluing sheep on the market and limiting the number of sheep farms which may have to shut down.
There are 2,280 sheep farms in Iceland, or one farm for just less than every 150 people in the country, and data from last year puts the number of sheep in the country at 475,893, exceeding the population of people in Iceland by about 130,000.
As part of the conditions of the deal for farm subsidies, sheep farmers will be required to reduce the stock by no more than 10%. This is actually less than a more stringent bill, which ultimately failed to pass in 2017, which was asking for a 20% reduction.
It is unknown how many sheep farms will be getting subsidies, but in 2017, 1,800 farms were paid. At that time, 560 farms received a direct payment of 1 million ISK and another 800 were paid anywhere from one to five million ISK.
While Icelandic lamb meat is iconic of the country, it has in recent years struggled to be profitable. As reported in 2017, farmers at the time complained that the market price put against the costs of production amounted to them actually losing 150 to 200 ISK on every kilo exported. This prompted the Icelandic government to launch a marketing campaign abroad, hoping to boost these exports.
How much of a positive impact this round of subsidies will have on Icelandic sheep farms remains to be seen.