Salix arctica; the Arctic Willow is a common low shrub which can be found in all heathers both in lowland but also in the highlands and mountains. In sheltered areas it can grow up to 2 meter tall but that is a rare appearance (I saw such shrubs at Þorsmörk). It is a dioecious shrub, the opening photo depicts female catkins. The male catkins are coloured red and yellow. It is believed that the red colours in the catkins are an adaption to cold temperatures..
It can be identified from the other common willow shrubs by the fact that it is hairy on the bottom side of the leaves and along the leave margins, where S. lanata (woolly willow) is hairy on all sides of the leaves and young stems and S. phylicifolia (Tea-leaved Willow) has no hairs. Very characteristic are the denely hairy female flowers and fruits. The Woolly Willow has hairy female catkins too, but the hairs are placed on the catkin between the individual flowers.
Salix arctica, arctic willow is a member of the willow family (Salicaceae). The Icelandic name of this species is Grávíðir