IIRC this is attributed to the fact that the Vikings came to Iceland from Scandinavia via Scotland, a place with very thick soils capable of regenerating forests.

Superficially Iceland looked forested like Scotland, so they continued their existing animal grazing practices, which along with logging then destroyed the thin topsoil layer of Iceland.

I think it was Jared Diamond who summarized it like that, but in the context of Greenland, where the Viking immigrants suffered and even worse fate, but the patterns are similar.