Israeli Produce Prices to Skyrocket After August Heatwave

Supermarket chains are holding the line for now, but wholesale prices have climbed sharply after heat wave cuts harvests.

Tomer Appelbaum

Retail prices for fresh fruit and vegetables in Israel are due to skyrocket, the result of damage caused by last month’s heat wave.

The leading supermarket chains have so far kept prices steady, but wholesale prices rose by tens of percentage points since last week. The chains say they are selling fresh produce at a loss and can’t hold the line for much longer.

“I’ve given instructions to buy almost no tomatoes or cucumbers for the next few days, just 20% of what we need,” said Rami Levy, the founder and CEO of eponymous supermarket chain.

“True, it will create a shortage over the next two or three days, but nothing will happen to anyone if they can’t buy tomatoes for a couple of days,” he said. “On the other hand, if I buy at any price the price will keep rising. We’re currently checking the possibility of importing from Spain, where cucumbers are much cheaper than in Israel.”

As of Wednesday, the Rami Levy in Jerusalem’s Talpiot shopping area was selling tomatoes for 4.90 shekels ($1.27) per kilogram. Cucumbers were 3.90, sweet red peppers were 5.90 and eggplant was going for 4.90 per kilogram. The nearby Super-Sol Deal was charging 5.90 shekels per kilogram of tomatoes and cucumbers, while eggplant was 6.50. No peppers were available.

A Mega supermarket in Jerusalem’s Malkha mall was selling tomatoes and cucumbers for 6.90 shekels per kilogram. Eggplant and sweet yellow peppers were 7.90 shekels and 10.50 shekels per kilogram, respectively.

But on the Yerekom website, an online marketplace for produce trade, wholesale prices for tomatoes had jumped 70% since Rosh Hashanah eve by 70%, to as much as 8.50 shekels a kilogram. Yesterday they rose another 23% to 11 shekels. Cucumber prices, which had been holding steady at 6.50 a kilogram on Wednesday, soared 54% to 10 shekels yesterday. Eggplant prices rose over 32%, to up to 6 shekels on Wednesday, but unlike most produce they fell 19% yesterday, to 4.90.

“If the trend continues like this, you’ll see produce prices really climb in the next few days,” said one supermarket executive who asked not to be named. “We won’t have a choice, we can’t keep selling everything at a loss. It wouldn’t make any sense; if we sell one item at a loss, we have to raise prices for other items.”

Prices in fruit and vegetable stores were already rising on Wednesday. An informal survey of several produce shops found that tomatoes were selling for 10 to 14 shekels a kilogram, cucumbers for 11 to 13 shekels and peppers for between 11 and 15 shekels per kilogram.

The Agriculture Ministry said last week it was easing import quotas of fresh produce to increase supplies, but that hasn’t affected prices so far. Food industry sources said it would be unlikely to have any impact until after the first day of the Sukkot holiday, in 10 days’ time.

“Imports from Jordan are under way, but because they also had a heat wave the quantities aren’t large,” the ministry said. “Imports from Europe take a couple of weeks, so the produce will only arrive Sukkot eve.”

Dubi Amitai, president of the Israeli Farmers Association, attributed the higher prices to two heat waves that gripped Israel in August, but he said other factors exacerbated the problem. Last month was the second-hottest in Israel, after August 2010, in the 75 years since data collection began, according to the Israel Meteorological Service.

“I know three growers in the Hevel Habesor area that stopped growing tomatoes because they never received proper compensation after the war in the south,” he said, referring to last year’s Operation Protective Edge.

Amitai said that with proper planning, the price increases could have been prevented.

“Farming in Israel needs to be planned,” said Amitai. “If you gave us the tools to do it, we could guarantee stable prices and supply.

Planning involves ensuring that labor is available when it’s needed, water prices are low and there’s direct support to agriculture. There don’t have to be price jumps like this — it’s not good for growers or for consumers.”

Amitai said Israel has a surplus of potatoes but that he can’t export them to Jordan because authorities in Amman block them.

“It appears to be for political reasons,” he said. “The Jordanians do all kinds of things in order to buy goods from us. On the other hand, we’re importing tomatoes and cucumbers from Jordan, and that’s wrong.”