While You Were Protesting / Cottage Cheese Down, Other Dairy Up 8%

The move by the three big dairies, along with other food manufacturers, to raise their prices at the beginning of June sparked the current wave of consumer and middle-class protests.

The price of cottage cheese and soft white cheese may have dropped during the last month in the wake of consumer protests, but the prices consumers paid for other dairy products increased by 8% for no apparent reason. Dairies have not raised prices since early June.

The move by the three big dairies, along with other food manufacturers, to raise their prices at the beginning of June sparked the current wave of consumer and middle-class protests. The government stepped in to examine the matter, ultimately striking a deal that lowered cottage cheese prices for the year. Yet this apparently didn't stop the companies from raising prices on other products: In the past five weeks, dairy products have become 8% more expensive, according to the Nielsen research institute.

Cottage cheese - Eran Wolkowski - July 2011
Eran Wolkowski

Nielsen found that, at stores with bar codes (supermarket chains, grocery stores, mini-markets and corner stores ), the price of a kilo of Napolean cream cheese with olives increased on average by 4.7%, from NIS 53.60 as of the third week of June to NIS 56.10 as of the end of July. These prices take into account sales.

The price of Gamadim pudding increased almost 8% during that period, from NIS 24.10 per kilo to NIS 25.90. The price of Tnuva's White Chef cream increased 3.4%, from NIS 33.20 per kilo to NIS 34.30.

Cartons of Yotvata enriched milk and Tnuva White Chef white cheese became 2.5% more expensive.

Other prices also increased, but by less. A kilo of packaged Emek yellow cheese went up 0.7%, from NIS 83 to NIS 83.50, while the price of a liter of Yotvata chocolate milk went up 0.6%.

While these are relatively small increases, there are no obvious explanations for them, since the dairies have not raised their prices since the beginning of June.

Of the 11 products Nielsen checked, only three became cheaper, including cottage cheese and white cheese - the focus of the protests. Cottage cheese was selling for an average of NIS 7 per container before the protest began, but prices dropped after the dairies were battered by public criticism. Supermarkets started selling the cheese for NIS 4.55 a cup, and the dairies agreed with the government to set a recommended price of NIS 5.90.

During the same five-week period, the average price of a kilo of Tnuva 5% fat cottage cheese dropped 9.4% from NIS 24.70 to NIS 22.40, Nielsen found. Ski white cheese became 5.9% cheaper.

The dairies blamed the supermarkets, saying they raised prices unnecessarily.

"The supermarket chains are still turning big profits, and this is another example of it," said a senior executive at one of the dairies.

"The data shows that the party setting the prices is the supermarkets and not us," said an official at another dairy. "When the protest began, the supermarkets dropped prices in order to become the campaign's Robin Hood. When they saw that the protest was moving on to home prices and other things, they started raising prices again. You need to remember that they offered lots of sales on cottage cheese and white cheese when the protest began, and they spent a lot of money on this. They need to recoup it somehow."

Tnuva responded that it last raised prices at the beginning of June, and wouldn't be raising prices again through the end of the year.

Yet the supermarket chains countered that they had not raised prices, and said that the figures indicating price increases stemmed from the lack of sales last month.

"We had no price increases, au contraire," said Rami Levi of Rami Levi Shivuk Hashikma. "But it could be that producers had fewer sales in July, since Shavuot was at the beginning of June. If stores did indeed raise prices on dairy products, that's some serious nerve."