Russian Boycott of European Food Cuts Into Israeli Exports

Overabundance of local produce in Europe, caused by Russian boycott, is crimping demand for Israeli fruit and vegetables.

Eyal Toueg

The calls in Europe for consumers to boycott Israeli fresh produce seemed to have had little impact, but Russia’s decision to bar imports of most European fruits and vegetables has had the perverse effect of cutting sharply into Israel farm exports to the continent.

The Israel Export Institute said on Wednesday that Israeli agriculture exports to Europe plunged 23% in July and August, compared with the same time a year ago, to $98.3 million. That was a sharp enough fall to lower total Israeli farm exports to Europe in the first eight months of the year by 8%, the quasi-governmental institute said.

The reason for the drop is that Europe has an overabundance of local produce due to the Russian boycott, crimping demand for Israeli products and causing food prices to fall, said Ofer Sachs, the institute’s CEO.

Russia last month imposed a one-year embargo on imports of a host of agricultural products from any country or group that had adopted sanctions against it, including the European Union and Norway as well as the United States, Canada and Australia. The EU exported about 5.1 billion euros ($6.5 billion) of food products to Russia last year, or 4.2% of the bloc’s agricultural shipments, according to the European Commission.

“In Spain and Holland, for instance, they produce very similar products to ours. A very large part of their market is in Russia. When they can’t export their goods to Russia, they sell them in the local market,” Sachs said. “Prices in Europe have fallen tens of percent and we simply can’t export our products there at competitive prices.”

The decline in farm exports has touched almost every category. Fruit exports dropped 36% year on year to $39 million, vegetable exports by 17% to $16.5 million and flower by 19% to $8 million. Exports of fish and meat dropped 17.5% to $5 million.

“The extent of exports in the summer is relatively small and is subject to a lot of volatility,” Sachs said, saying they typically account for just 8% of the year’s total.

The loss of the European market comes as many growers lost crops to the Gaza fighting over the summer. In the south, many fields were destroyed by fires caused by Hamas rockets and from Israeli tanks and other military vehicles crossing over them. Harvest and planting times were lost.

“At this stage, we don’t know the extent [of the damage], but the fact that foreign workers have left also had an impact on exports,” Sachs said.

Ironically, some help for Israeli agriculture may be coming from Russia. Last month, a Russian delegation arrived in Israel seeking to increase imports of Israeli farm products. Food manufacturers have also reported they have received inquiries from Russian food distributors seeking to buy a wider range of Israeli goods, not just food.