They're a nuisance, Loftsson says. A whale off Port Stephens, NSW, Australia. Credit:Dean Osland/File "They are talking about it: 'Oh, we have to stop the ship traffic'. In 10 years' time it will be 60,000. You will have to close the port of Brisbane and make everybody bankrupt. "[There will be] more strandings of whales all over the place in Australia. It's ridiculous thinking." I meet the nemesis of the save-the-whales movement – a man almost single-handedly keeping both Iceland's whale-hunting industry and Japan's whale-eating industry afloat – in the bar of a hotel in Reykjavik.

Iceland is one of the last pro-whaling countries in the world, for historical reasons (in Icelandic "stranded whale" means "great luck"), and thanks to a long-standing, stubborn determination not to be lectured by the outside world. Elding Whale Watching runs cruises in the same bay where fishermen hunt whales. Credit:Nick Miller But their resolve seems to be wavering. Reykjavik's Faxafloi Bay has an invisible, parliament-decreed line on the water. On one side an ever-expanding fleet of whale-watching boats take tourists on a stomach-heaving, bone-chilling chase for an elusive, beautiful glimpse of minke whales on the move. Whale-hunting boats in Reykjavik's Faxafloi Bay. Credit:Nick Miller

On the other side black, sleek whaling boats hunt the same creatures and drag them back to shore. There is a similar line in Icelander's minds, and it appears to be shifting. Opinion polls reflect a moment of realisation: if Iceland is to pull itself back from the wreckage of the financial crisis, it needs the tourists more than it needs the meagre income from whale meat. Whale-hunting equipment abord a boat in Reykjavik's Faxafloi Bay. Credit:Nick Miller This month Foreign Affairs Minister Gunnar Bragi​ surprised everyone by suggesting a reduction in the whaling quota to improve Iceland's international standing. But if one man stands more than anyone in the way of this change of heart it's Loftsson – chairman of HB Grandi, one of Iceland's biggest seafood companies. This croaky-voiced millionaire is well connected politically (even by the standards of an island where just about everyone knows everyone), short and defiant.

Whales are a small part of his business. It may not even make him any money. Nevertheless. "I've been in this game for all my life, my father started this business in 1947," he says. "It was started to do whaling." His company chases fin whales, in deep waters offshore. They restarted in 2009 after a 20-year lull. "We look at the whale stocks here … it's just a sustainable industry like fishing," he says. "You go on sighting cruises, you find out what the stocks are and you set the quota accordingly. It's the utilisation of a resource in the ocean. We have the equipment so why not carry on?"

Due to international law on the trade in endangered species, his only customer is Japan. At the time we speak in May he has 1700 tonnes of frozen meat on a ship due to leave for Japan. It is held up by mechanical problems and sets off in early June. This week Japan was still waiting with barely 1000 tonnes left in the whole country: the least since 2000. Loftsson is vague on whether whaling makes a profit. "It's OK. It's not digging into a gold mine or something. But it's OK. The market is there in Japan and people like this food. To me it looks like we can carry on forever." But he's matter of fact on how it works: "We shoot them with the explosive grenade on the front of the harpoon." What about the morality? "The brains of whales are not big compared to the size of them. They are small. You know you have 1 million feral camels in Australia? They go out in helicopters and shoot them."

And what about the politics? "I don't care less. I went whaling myself in Australia once in 1977, out of Albany. All these guys in the [International] Whaling Commission … haven't a clue what they are talking about. "Where is this f---ing world opinion [against whaling]? Have you ever seen an opinion poll taken around the world? "And who likes being told what to do? You don't like that in Australia. Like this climate [change] talk: your prime minister, he doesn't care less. I like that. He's my man." Down at the harbour, whaling ships sit metres from the whale-watching boats. But the whalers are motionless, undergoing maintenance, while tourists flow on and off the opposition.

Rannveig Gretarsdottir​ is general manager of Elding Whale Watching, one of the biggest and oldest such companies to have moored their boats in Reykjavik's harbour. Fifteen years ago Elding was based near the airport – they were the first to move into the capital. Now, at the right time of year, almost every whale that wanders into the bay gets a paparazzi welcome. "It is No. 2 or 3 in the most popular attractions [in Iceland]," Gretarsdottir says. "We had 230,000 guests whale watching last year and it is 99 per cent foreign tourists. It's quite important. People working on promoting Iceland say it is one of the focuses in their marketing." She has fought to change local opinion – when she began 80 per cent of Icelanders were pro-whaling – "because it's our right, because we should not let others tell us what to do and we have the right to use the ocean around Iceland". "We are a proud island. But that has been changing little by little every year and now it is about 50/50. And most people now think it's ridiculous to be whaling in the same area we do whale watching."

Though they try not to whale watch near the whaling boats, they sometimes see dead whales being towed back to port. One of their biggest worries is the fall in minke whale sightings. She has serious doubts about the official population figures. "We feel that the minke whale is getting fewer and fewer by the year. And all the minke whaling is done in the area where we are doing whale watching. How ridiculous is that? We are both chasing about 500 whales in the same bay. And of course the whales don't know where the line is." While Loftsson is Elding's most high-profile opponent, in practice the minke whales that fuel her business are hunted by another company: Hrefnuveidimenn​ ehf, since 2009 headed by Gunnar Jonsson. I meet Jonsson in his factory, on the dock of a small port south of Reykjavik. He's the young, working-class alter ego of Loftsson: shaven-headed and friendly in his chequered shirt, clearly tired of journalists questioning his livelihood.

"It's maybe four months a year we are hunting [whales]," he says. He sells some whale products to Norway, some blubber to Japan, but mostly meat to local restaurants. He's running a fishing business, and anything that brings in cash is welcome. He argues whale hunting attracts tourists because they want to taste the end product. "Four or five years ago we were selling more [whale meat] to the supermarket than to the restaurants, now that has changed." He's dismissive of international compassion for whales – he believes it's drummed up by groups such as Greenpeace as donation bait, but doesn't reflect real deep beliefs. "Of course whales are big and beautiful and everything," he says.

"We have every year people campaigning against us in newspapers around the world. But people aren't saying they won't travel to Iceland because it's a whaling nation. That's just bullshit. You can see the numbers. "I can't see any reason to stop whaling just because the travel industry is going so well." His main concern, like Gretarsdottir's, is that the minke whales are disappearing – more than half in less than a decade. "They have gone somewhere else," he says. "Something is going on. Something is changing." Johann Sigurjonsson​ is director-general of the Marine Research Institute ("Hafro") in Reykjavik – they advise the government on sustainability of marine stocks. Calm and authoritative in his high-rise office overlooking the harbour, he is dismissive of "short-term", emotional arguments over fish stocks and whale populations. He presents himself as a man of science, above politics, economics and "highly vocal people". "We are focused on biology," he says. "Whales in our view are just part of the ecosystem. We advise on cautious, small harvest of whales every year and we have been doing that for decades, based on the principle of sustainability. We are just reporting the catch level that would be sustainable if the government so wants."

The government sticks to those quotas. Ergo, the whales are not in trouble. Sigurjonsson's researchers have noticed a change in minke whale sightings, but they don't believe it's due to whaling. They believe climate change is warming the sea and moving whales' food sources away from Iceland (it's also affecting puffins and sand eels). Gisli Vikingsson​, a whale researcher with Hafro, says fin whales are classified as endangered solely because of what's happening in the southern hemisphere – in the central north Atlantic, the population is pretty close to the pre-whaling level. "Globally there's so much fewer fin whales today than [a century ago] but it's not biologically sound to lump together many different units," he says. Loftsson is a full bottle on Hafro's statistics – and like them, and like the government, he sees whales as a marine resource his country has every right to continue to exploit.