Israeli food importers are protesting that the Health Ministry’s tough new labeling requirements on unhealthy food will force them to raise prices. And they have won backing from the finance and economy ministries, which are battling to lower the cost of living.
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The Health Ministry isn’t ready to back down, though. It has found a new way to measure the cost to the economy: the sickness and early deaths caused by people eating food with excessive sodium, sugar or saturated fat.
The Health Ministry study, which was obtained by TheMarker, estimates that the warning labels would prevent more than 22,000 deaths over the next decade, saving the economy some 6 billion shekels ($1.7 billion) in the process.
The labeling would not only reduce Israel’s mortality rate, letting people work longer and add to economic output, but also generate significant savings in health care costs and days lost to work from sickness.
The rules, due to go into effect next January, require products to have red labels if they contain more than 800 milligrams of sodium, 22.5 grams of sugar or 6 grams of saturated fat per 100 grams of product.
The rules have met fierce resistance from food importers, who, unlike local manufacturers, can’t adjust ingredients to exempt their products from the label. The labeling itself will also add costs, they say.
The ministry’s key estimate for the health savings assumes there will be a 30% decline in Israelis’ consumption of harmful ingredients over the decade, either because consumers are stopping buying red-label products or because food makers adjust their formulation.
Even in its most conservative forecast, the ministry assumes that consumption of sodium, sugar or saturated fats would fall by 20%. This would reduce the number of deaths by 16,300 over the first 10 years.
“Sugar is the main ingredient that affects the sickness and mortality rate in relation to diet. Today, sugar consumption by the average Israeli accounts for 12.45% of daily calorie consumption,” said the ministry report, which was due to be presented to treasury officials on Tuesday.
“In our most optimistic scenario we hope to reduce sugar consumption to 8%, and in a less optimistic scenario to 10%,” the report said.
The ministry estimates that 10,000 Israelis die every year from being overweight or from improper eating, accounting for nearly a quarter of all deaths. The figure has climbed dramatically in recent years as obesity rates have risen. About 30% of sixth-grade children are overweight, as are more than half of all adults. Among Israeli Arabs, the rates are an even higher: 38% and 70%, respectively.
The Economy and Industry Ministry opposes the labeling rules for several reasons. It estimates it will raise the cost of small, less expensive products by as much as 25%, which will inevitably be passed on to the consumer.
It says such labeling is untried and tested – except in Chile, where it has had mixed results – and is likely to reduce competition in the food market by handicapping importers.
Domestic “manufacturers will be able to adapt completely to the needs of the local market as regards labeling. By comparison, importers can’t make the same adaptions on their packaging in most cases,” the economy ministry said, adding that the January deadline for enforcing the new rules doesn’t give the industry enough time to prepare.