Wants To Keep Fish Processing Domestic#

It is not possible to increase the price of fish since the companies are in international competition, and the market does not care about tax increases in Iceland. Then he hopes that the fish processing companies will not move abroad.

“It is simply the case that the competitiveness of domestic processing is considerably reduced compared to processing in, for example, Poland and the Netherlands. After all, we are seeing them very aggressively buying in Icelandic fish markets. That could very well happen, but I believe it is harmful to the Icelandic fisheries, Icelandic fish and the Icelandic nation. I think we need to have a competitive environment and framework for the industry in Iceland that is strong enough to withstand international competition and we can then process this fish domestically,” says Gunnþór.

The CEO of the Vestmannaeyjar processing plant says the company has had to close its fish processing plant and lay off fifty employees due to an increase in fishing fees of 850 million krónur per year. It is likely that similar measures will be taken in many rural areas in the near future.

Need To Adapt#

Now Icelandic fisheries companies need to change their operations.

“Of course, this will take some time to become a reality. People are not turning the Icelandic fisheries industry around ninety degrees. It will take time for the industry to adapt to this,” says Gunnþór.

Sigurgeir Brynjar Kristgeirsson, Binni, the Managing Director of the Vinnslustöðinn in Vestmannaeyjar says the company has had to close its fish processing plant and lay off fifty employees due to an increase in fishing fees of 850 million krónur per year.

“It’s not complicated, it’s just as it is in the press release, We have been charged what we calculate to be around 850 million ISK in fishing fees, which we have to bear. This 850 million is a lot of money in the eyes of Vinnslustöðir and we need to respond. It is obvious that Vinnslustöðir itself is in debt after the purchase of Ós and Þórunn Sveinsdóttir and we need to pay our debts. That is what we need to do and we need to respond to that by saving and our conclusion, when we have calculated all the options here in the Vestman Islands, is that the option that gives us the greatest savings is to close Leo Seafood,” says Brynjar in an interview with Vísir.

Far Away#

Sigurgeir says that the streamlining will save around 350 to 500 million ISK per year. If we compare it to 400 million, 450 million ISK remains, which must be sought elsewhere.

“We will never reach this 850 million. This is not complicated, this naturally ends up with people, innocent people who have worked at Leo Seafood for a long time and with the previous owners there. Hardworking and good people who have put in all their efforts and this is the sad result.”

The management is aware that some of the 850 million will end up at the processing plant, but they will of course continue to find other ways to streamline.

The processing plant in Vestman Islands was operated with a loss of half a billion kronas last year. The company has only operated at a loss once before in the last quarter of a century. The company has postponed necessary investments in its ship fleet due to the government’s plans for fishing fees.

“This is of course just the first and biggest operation, but I think I can say that there will be no mass layoffs as a result. But we will look at every nook and cranny of the company and try and streamline and save and change operations. This will always ultimately affect employees, it affects service providers, it affects investments and it affects the company’s ability to move forward. So, this is bad for the company and for the community in the Islands in every way.”

They Intended To Get Through The Storm#

In a press release from Vinnslustöðirn, it was said that Leo Seafood’s operations had been difficult. Huge increases in wage costs and a strong krona had made it so. Sigurgeir says that when the company bought Leo Seafood and Ós, it was the sincere intention of the management to continue the companies’ operations. Despite the difficult operating environment, success was achieved and the management and staff of Leo Seafood did well.

“Of course we wanted to get through this, but this is the sad result. We had intended and intended to continue, just so you know.”

Crisis Ahead In Many Rural Areas#

Sigurgeir has no doubt that the layoffs will have a major impact on the community in the Westman Islands. He knows it well himself after Vinnslustöðin, with him in the bridge, laid off a large number of employees due to operational difficulties. After the layoffs, only 150 people were employed by the company.

“Before these layoffs, we had 330 people working for us in the Vestman Islands. I knew the consequences of that when we laid off, it was after many years of persistent unemployment. People were not holding on to their houses. There was a crisis and a state of crisis here in the Vestman Islands. Of course, that is what I think is far, far more likely to happen in many parts of the country. It is not optimism and not the energy that comes with increased taxation, but the opposite. Now people have to go on the defensive, pack up and do what needs to be done. Which is very unpleasant for the communities and the people around them.”

Source:

• Telur að fleiri fyrir­tæki muni ráðast í upp­sagnir / Visir (in Icelandic)
• Þetta endar náttúru­lega á sak­lausu fólki / Visir (in Icelandic)

Further reading:

• Fish Processing Plant Closure Results In 50 Job Losses / Iceland Review