BY GYLFI PÁLL HERSIR AND ARNAR SIGURDSSON
REYKJAVIK, Iceland - About 90 families in Thingeyjasy'sla,
in the northeastern part of Iceland, are facing problems as
the local Cooperative Thingeyinga (KTH), one of the last
farmers cooperatives in the country, goes under. It has
already been divided into "beneficial" and "non-beneficial"
sections, and the profitable ones are being sold to private
partners. What happens with the farmers' credit remains an
open question. Their products have been sold by and through
the co-op for credit against purchases of fertilizer and
other goods through the same co-op.
Farmers cooperatives were founded in Iceland at the end of last century with the aim of facilitating commerce for the rural population: marketing their products, making goods cheaper, and helping win new markets abroad.
Until about 15 years ago, amalgamated cooperatives ran stores in most Icelandic towns. They also operated plants to process fish and lambskin, produce clothing, and more.
The KTH cooperative buys all the milk and meat (mainly sheep, as well as beef and pork) from the farmers. KTH has 2,000 members, farmers, and others. It operates a dairy, slaughterhouse, packinghouse, and department store. KTH also held shares in different businesses.
In May the cooperative halted all operations and farmers could not get any money. Sigurdur Jónsson, a retired farmer at Ystafell, told Militant correspondents the farmers may not receive anything for their milk delivery of the last five weeks and that the money kept in the cooperative in order to buy fertilizer may be lost. They were forced to agree to sell the dairy facility to another dairy cooperative and the meatpacking operation to a bank.
Farmer Kári Thorgrímsson at the Gardur farm has 170 sheep and 17 cows. Besides this he catches and smokes trout. Like many other farmers, Thorgrímsson now has to work other jobs; he travels around to shear sheep.
Thorgrímsson thought that a farmers demonstration in Brussels earlier this year was the most important event of the decade. In particular he appreciated that farmers came from many countries. He noted the media in Iceland paints farmers as backward, saying it is "important to overcome the division between farmers and workers. We have been taught workers are always making demands. But we should work together." Thorgrímsson also commented, "A concept of free trade is being used as a whip on farmers. In one sense it is okay to open up trade for farmers' products with other countries. But then farmers have to build our own organization, collaborating internationally."
Ólof Asgeirsdóttir runs a farm together with her brother's family at Vogar. Aside from the farm, they are self- employed in tourism. She said they were worried because they had made investments to attract tourists to their farm. She expected some farmers will be forced off their farms because of the bankruptcy of KTH.
Agriculture accounted for only 2 percent of the national income in Iceland in 1998, down from 5.1 percent in 1980. Around 5 percent of the workforce are employed in agriculture today, compared to 8 percent in 1980 and 16 percent 1960.
In face of a crisis of overproduction, farm quotas were initiated in agriculture in Iceland in 1979, with the aim of cutting the number of sheep in the country from about 900,000 to 500,000. This pushed many farmers from their farms in the 1980s. In more recent years, farmers have been allowed to buy and sell quotas for raising sheep and cows.
Sigurdur Haraldsson contributed to this article.