Agriculture plays an important role in the economy of Northwest Iceland with Húnaþing vestra one of its prime agricultural regions. Sheep farming is the largest and most important of Húnaþing vestra’s agricultural industries. The region is particularly well-suited to sheep farming as the region is fertile and the grasslands are highly tolerant of grazing. Horse breeding is also important in Húnaþing vestra, and horsemanship is highly valued, particularly for its importance to rounding up sheep after they have spent summer grazing in the mountains.
Agriculture in Húnaþing vestra is now diversifying with several new and exciting agricultural projects starting to blossom in the region. Rabbit production for human consumption is showing promise with shops and restaurants around Iceland keen to stock this product. Other new exciting ventures based in the region include bee-keeping to provide a local source of honey, a market garden to grow vegetables and seedlings locally, and cheese production from milk sourced at the farm.
A slaughterhouse operates in Hvammstangi for sheep, horse, cattle, and recently rabbit. Goods are sold to both domestic and foreign markets, with approximately 35% of revenue derived from the latter.
Fishing is also important in Húnaþing vestra. One boat, which fishes for cod and haddock, and two trawlers, which fish for shrimp, are based in Hvammstangi. There is also a shrimp processing facility in Hvammstangi which opened in 1972 — the oldest in Iceland.