Israeli Snack Giants Are Bitter as Ministry Wages War Against Unhealthy Foods

Industry says gov’t seeks credit for healthier eating trend long under way.

File photo: The popular Osem-produced Bamba snack, on sale in Israel.
Yasmine Shemesh

A food fight has erupted between the Health Ministry and the companies that bring Bamba, Bissli, Coca-Cola and prepared hummus to Israelis’ kitchen tables.

The ministry started the fight some weeks ago, launching an unprecedented series of television ads pointing out the health risks of eating too much salt or sugar and consuming too many calories. Food makers acknowledge their products need to be changed, but they resent the assault at a time when they have begun making their products healthier.

This week TheMarker revealed that the industry is undertaking an initiative to voluntarily relabel their products to provide better nutritional information in line with European Union and U.S. practices.

Meantime, industry executives contend, Israeli consumers have taken healthy eating into their own hands: Sales of white bread, refrigerated salads and processed meat have plunged over the past several months, while purchases of bagged salad greens, pure tehina and whole-wheat bread have climbed. That all happened before the Health Ministry began airing the spots, making them superfluous.

Osem was the latest target of a Health Ministry campaign, which this week briefly aired an infomercial highlighting the dangers of eating salty snacks.

Osem, whose line includes the iconic children’s peanut snack Bamba, controls 51.6% of Israel’s salty snacks market, which generated sales of 505 million shekels ($131.5 million) for the company last year. Strauss Group also has a major interest in the category, with sales of 323 million shekels. While many other products have fallen out of favor for health reasons, sales of salty snacks actually rose 4% last year.

The Ministry quickly retreated from its attack on salty snacks (although it denied pulling it, saying it was intended from the outset to be a short blitz campaign).

But the food industry, already struggling with the sudden shift in consumer habits, is wary about the next salvo.

“I don’t know why the Health Ministry came out with their campaign against snacks and the food companies,” said Dr. Maoz Gruper, chief scientist at Osem.

The company is working hand in hand with the Health Ministry’s “Efshari Bari” (“Health is Possible”) program, in which it agreed to gradually reduce sodium in its products.

“We know there’s more work to be done, but we’re doing it and we’ll continue to do it even if there isn’t the campaign hadn’t been put on the air to begin with,” Grouper said.

Osem executives were particularly upset that the Health Ministry spot featured an unnamed product that looked like Bamba.

“Bamba in particular doesn’t have a lot of sodium, so we’re not clear why it appeared in the ad,” said Gruper. “The Health Ministry has set a target of 400 milligrams of sodium per 100 grams for bread to earn Efshari Bari certification, but Bamba has even less than that.”

Another food industry executive, who asked not to be named, accused the Health Ministry of trying to take retroactive credit for healthier eating trends. “Consumers are 10 steps ahead of the Health Ministry — they want healthier food, there’s been a lot of talk about that, and they’ve voted with their feet,” he said, adding that it was the reason food manufacturers began to change their ways.

Anat Gross Schon, head of the dairy division at Tnuva, Israel’s biggest food maker, said the company had begun reducing sugar and salt content in its products as early as 2013.

“We thought claims like ‘from natural ingredients only’ and ‘no artificial colors,’ which food companies were using at the time, were a nice gimmick but really didn’t fundamentally address people’s health needs. We realized that the industry had to do something. No one dies from preservative but people do die from sugar and from salt,” she said.

The reformulations of its products haven’t led to higher sales at Tnuva — in fact sales have fallen in the past year. “We didn’t think it would increase sales, rather we thought that as a leading food company we must take the lead for the good of the consumer. It costs of tens of millions of shekels,” said Gross Schon.

At Strauss Group, chief technologist Prof. Eyal Shimoni said that responsible companies have to be concerned about the gap between consumer expectations and what the companies are providing.

“In 2012 we began a long process of reducing sugar content, but suddenly today there’s all this concern that companies aren’t cutting sugar and other ingredients. Often we come and do things long before the regulators enter the picture,” he said.

Shimoni said Strauss and its peers have more cutting of sugar and salt to do. They should also offer smaller package sizes for products containing less-healthful ingredients and present nutritional information in a way that’s easier to understand.