Case Study

Iceland Groundfish Fisheries

Author: Julia Mason


Iceland’s Individual Transferrable Quota (ITQ) commercial fisheries demonstrate how flexible and responsive management, centralized organization that promotes learning, ample assets, and resilience mindsets interact to confer resilience of sustainable and profitable stock management to climate-driven changes in species abundance and distribution. However, the strong reinforcing feedbacks among attributes that stabilize the system may entrench economic inequalities and preclude adaptation to broader change.

System Overview

The highly productive convergence of warm Atlantic and cold Arctic currents in Iceland’s waters supports rich fisheries: Iceland consistently ranks among the top 20 marine capture nations globally, with around 1600 vessels landing around 1.5 million tonnes annually at 1.3 billion USD value (ICES 2019; FAO 2020). The commercial fishing sector is core to the economy, contributing around 40% of Iceland’s total export value (Gunnlaugsson et al. 2020). Cod is the most important economic species; fishers also target diverse demersal species including haddock, saithe (pollock), and flatfishes as well as pelagic capelin, herring, blue whiting, and mackerel. Fisheries management in Iceland is tightly controlled and centralized, with over 98% of catch and more than 30 species managed under the ITQ system. All commercial fishing requires a permit, no foreign vessels may own quota, and all landings are monitored, with data shared with fishers in real time. Annual catch limits are set based on scientific advice and, increasingly, precautionary harvest control rules (Gunnlaugsson and Valtysson 2022). The ITQ system’s alignment of ecological and economic goals—firms are profitable and once-collapsing stocks have stabilized such that 99.98% of domestic catch is from sustainably-managed stocks (Gunnlaugsson and Valtysson 2022)—has built trust between industry and management and enabled more precautionary management. Iceland’s fishing industry is dominated by vertically integrated firms selling high-value products for export, with a growing value-add and innovation sector focused on quality and sustainability (Sigfusson 2020). Meanwhile, smaller communities lost fishing access and thus employment opportunities in the wake of the ITQ system, and the industry is considered prohibitive to enter as a newcomer (Chambers and Carothers 2017). The interactions between warm and cold currents that make Iceland’s waters so productive also create dynamic conditions that influence species productivity and distribution on interannual to multidecadal scales (Astthorsson, Gislason, and Jonsson 2007). A prolonged warm anomaly from the mid-1990s-2010s drove northern range expansions of warmer-water species including a novel incursion of Atlantic mackerel, while other commercial species like capelin temporarily disappeared (Valtýsson and Jónsson 2018). Iceland’s fleet rapidly capitalized on the mackerel opportunity, establishing a lucrative fishery but sparking international conflict over fishing rights (Spijkers and Boonstra 2017). Looking ahead, researchers project that local variability will dominate the global climate signal through mid-century, but Iceland could expect increased productivity and range expansions of some species consistent with a general pattern of poleward shifts (Campana et al. 2020; Mason et al. 2021; Mullon et al. 2016).

Resilience Attributes and Linkages

As demonstrated by rapid responses to mackerel and other species changes over the past 30 years, Iceland’s fisheries appear resilient to climate-related changes in species abundance and distribution. Management is responsive to species changes through setting annual catch limits, authority to set immediate temporary closed areas to protect spawning areas, and incorporation of new species into the quota system based on catch history. High learning capacity via the strong scientific system enables this responsiveness. Regulatory measures also promote fisher flexibility to adjust to catch fluctuations through mechanisms to bank or borrow quota allotments and convert quota among species. Fisher mobility is unrestricted under the quota system. High connectivity in management and supply chain organization structures including real-time data sharing, centralized national fish auctions, and vertical integration promote transparency and access to knowledge, facilitating rapid responses to environmental and market signals. Stable and transparent supply chains generate access to economic opportunities such as specializing in underutilized species. A growing “innovation cluster” model increases connectivity and access to knowledge across the value chain and may help diversify knowledge sources. Strong social capital in Iceland’s society with a shared understanding of the fishing industry’s economic and cultural importance fosters trust and collaboration within industry and among industry, government, and scientists. The industry’s access to natural and material assets underpins other resilience attributes. The combination of a productive environment and effective management supports commercial stock population abundance, healthy age structure, and relatively high species diversity for the latitude that have helped maintain stable catches despite environmental fluctuations. Profitable, vertically integrated firms have ample wealth and reserves that expand adaptive options such as buying high-capacity trawlers to increase mobility, purchasing more quota to diversity portfolios, and relying on reserve wealth and insurance to cope with species losses. However, these feedbacks reinforce economic inequalities, where the wealthiest firms are most poised to benefit from new economic opportunities or withstand losses; these wealthier actors also accrue political power and have strong incentives to maintain the system status quo. Increasing wealth accumulation and perceived inequality has been a source of social critique and political movements to reform or overturn the ITQ system. Finally, a history of variable and uncertain environmental conditions, market competition, and the security of the Nordic welfare system may contribute to resilience mindsets of comfort with uncertainty and confidence in the industry’s ability to adapt. Among communities and smaller firms, government innovation funding and little cultural stigmatization of failure provide individual leaders with agency to experiment and flourish with transformative ideas. While Iceland’s industry has reason to be confident, an overall emphasis on reactivity seems to detract from planning and longer-term adaptation. Scholars and industry members have expressed concern about a lack of study and preparation for broader climate impacts such as ocean acidification and invasive species.


Iceland’s overall high capacities—economic, scientific, management, social, ecological—and experience with a variable marine environment have contributed to strong and reinforcing climate resilience dynamics. Tightly controlled and effective ecological management paired connected markets and supply chains that promote information exchange allow fishers and firms to rapidly respond to ecological changes, and resilience mindsets backed by abundant assets enable them to translate those ecological changes into economic opportunities. Iceland’s fisheries are in a strong position to react to climate change, but confidence in their responsiveness and vested interests in maintaining the status quo could impede proactive planning and entrench inequalities. Iceland’s successful adaptation to species shifts may also incur tradeoffs at the international level without greater governance integration across scales. A key first step for Iceland may be greater prioritization and integration of broader ecosystem dynamics and climate forecasts in fisheries science. Protecting smaller processors, perhaps through enhanced access to assets, will be important for maintaining competition, diversification, and innovation in response to ecological change. Finally, without greater attention to social equity and better communication of how fisheries contribute to society, the ITQ system runs long term risks of reactionary political reform destabilizing its strong ecological and economic structures. Exploring how to build resilience to climate change may present an opportunity to reconsider equity, distribution of benefits, and the ongoing role of fish and fishing in Icelandic society.


Astthorsson, Olafur, Astthor Gislason, and Steingrimur Jonsson. 2007. “Climate Variability and the Icelandic Marine Ecosystem.” Deep Sea Research Part II: Topical Studies in Oceanography 54 (23–26): 2456–77.

Campana, Steven E., Ragnhildur B. Stefánsdóttir, Klara Jakobsdóttir, and Jón Sólmundsson. 2020. “Shifting Fish Distributions in Warming Sub-Arctic Oceans.” Scientific Reports 10 (1): 16448.

Chambers, Catherine, and Courtney Carothers. 2017. “Thirty Years after Privatization: A Survey of Icelandic Small-Boat Fishermen.” Marine Policy 80: 69–80.

FAO. 2020. “The State of World Fisheries and Aquaculture 2020.” Sustainability in Action. Rome: FAO.

Gunnlaugsson, Stefan B., Hörður Saevaldsson, Dadi M. Kristofersson, and Sveinn Agnarsson. 2020. “Resource Rent and Its Distribution in Iceland’s Fisheries.” Marine Resource Economics 35 (2): 113–35.

Gunnlaugsson, Stefan B., and Hreidar Valtysson. 2022. “Sustainability and Wealth Creation, but No Consensus: Recent Decades in Iceland’s ITQ-Managed Fisheries.” Marine Policy 135 (January): 104836.

ICES. 2019. “Icelandic Waters Ecoregion–Fisheries Overview.” International Council for the Exploration of the Sea. Reports/Forms/DispForm.aspx?ID=36407.

Mason, Julia G, Pamela J Woods, Magnús Thorlacius, Kristinn Guðnason, Vincent S Saba, Patrick J Sullivan, and Kristin M Kleisner. 2021. “Projecting Climate-Driven Shifts in Demersal Fish Thermal Habitat in Iceland’s Waters.” ICES Journal of Marine Science 78 (10): 3793–3804.

Mullon, C., F. Steinmetz, G. Merino, J. A. Fernandes, W. W. L. Cheung, M. Butenschön, and M. Barange. 2016. “Quantitative Pathways for Northeast Atlantic Fisheries Based on Climate, Ecological–Economic and Governance Modelling Scenarios.” Ecological Modelling 320 (January): 273–91.

Sigfusson, Thor. 2020. The New Fish Wave: How to Ignite the Seafood Industry. Leete’s Island Books.

Spijkers, Jessica, and Wiebren J. Boonstra. 2017. “Environmental Change and Social Conflict: The Northeast Atlantic Mackerel Dispute.” Regional Environmental Change 17 (6): 1835–51.

Valtýsson, H. Þ, and S. Jónsson. 2018. “Impacts of a Changing Climate on Icelandic Marine Stocks.” In Impacts of a Changing Environment on the Dynamics of High-Latitude Fish and Fisheries, edited by F. J. Mueter, M. R. Baker, S. C. Dressel, and A. B. Hollowed. Alaska Sea Grant, University of Alaska, Fairbanks.

Acknowledgments: Thanks to Hreidar Valtysson and Matthias Kokorsch for their guidance in identifying resilience attributes. Resilience attributes and linkages section also draws from interviews with experts throughout Iceland’s fisheries system conducted between December 2020 and June 2021.

Photo: Fishing boats in Iceland. © Julia Mason