Bread Prices in Israel to Rise as Wheat and Gasoline Costs Spike

State-controlled bread prices will increase by 6.5% in first rise in past 18 months; prices of unregulated bread also expected climb.

State-controlled bread prices are expected to rise Tuesday by 6.53 percent, the Industry, Trade and Labor Ministry announced on Monday.

In Israel, the state regulates the prices of basic white bread and basic dark.
In its statement, the Ministry said that the price hike is a direct result of the steep incline in international wheat prices in the past month. The price of flour is a significant component of the controlled-price. The increase in gasoline prices also contributed to the rise of bread prices.

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In the past 18 months the controlled bread prices were not updated.
Yaron Angel, Angel Bakery CEO, told Haaretz he estimates that prices of all breads, and not only the ones controlled by that state, will increase coming Tuesday.

"I think that prices of all kinds of bread will go up in similar rates," Angel said, "breads which are not under the supervision of the state are also made from the same ingredients."

Another reason Angel mentions is that the prices of bread had not gone up in nearly two years. "Hourly wage went up, electricity prices went up," he explained, "but when an increase in flour and gasoline prices hit us, we have no choice. We are losing money – we lost in 2011 and in the first quarter of 2012."

Following the price hike, regulated dark and regulated white bread (750g) will cost NIS 5.24; regulated sliced dark bread (750g) will cost NIS 7.38; regulated sliced white bread will cost NIS 6.99.