Prices of Dairy Products, Eggs and Chicken to Increase Up to 17%, Says Israel's Agriculture Ministry

Protest group Israel is Dear to Us issues statement demanding agriculture and trade "stop encouraging increases in the cost of living though declarations and permits for additional price hikes."

Prices for produce from animal sources will continue to increase and the total hike for the year could come to 25%-50%, according to an Agriculture Ministry report released Wednesday.

The ministry’s Research, Economy and Strategy Division, which issued the report, said it had examined various scenarios related to feed-grain prices and their influence on producer and consumer prices for fresh produce.

Based on the division’s analyses, farm products will continue to get more expensive in the coming months, and the overall price rises for the year could come to 25%-50%.

The most dramatic scenario, which relies on the expected rise in grain prices based on the current prices for end-of year futures contracts in these commodities predicts a 13% price hike for milk and milk products; a 17% increase in egg prices; a 14% price rise for chicken products and a 13% rise in the price of turkey products.

This forecast is derived from an expected 50% rise in the cost of farm commodities by the end of the year and from the significance of grains calculating food production costs. According to the researchers’ calculations, feed grains account for 70% of the cost of producing milk and milk products, 85% of the cost of producing eggs, and 85% of the costs for producing chicken and turkey.

On the assumption that commodities prices moderate, the expected price hikes will also be lower. If the prices of relevant commodities go up by 25%, milk and milk products will go up 6% by the end of the year; eggs by 8%, chicken by 7% and turkey by 6%.

The protest group Israel is Dear to Us issued a statement in response to the ministry announcement on the expected price rises, saying the organization, “Demands that Agriculture Minister Orit Noked and Industry and Trade Minister Shalom Simhon stop encouraging increases in the cost of living though declarations and permits for additional price hikes.

“If it wasn’t enough that the government is raising VAT (an effective rise of 6%, as the tax rate goes up from 15% to 16%), and thus tacitly agreed to the supermarket chains taking the price-labeling guns out of storage, now the Agriculture Ministry is joining the campaign being waged by the Industry, Trade and Labor Ministry against the Israeli citizen who is collapsing under the price burden.”

The group continued: “These two ministries are using the populist excuse of ‘higher global commodities prices’ when they approve or publish price rises in products under price supervision, first bread, and after that milk, chicken and eggs.” It also claimed that “unfortunately, everyone involved here has an interest in raising prices.”

The Agriculture Ministry responded by saying that price-controlled milk products are not expected to go up in price until after the holidays. These products include fresh milk in bags and cartons (both 1% and 3% fat), plain white yogurts, such as Eshel and Gil, sour cream and butter.

The price of 98% of eggs sold in groceries, supermarkets and open markets is also under supervision, and won’t go up until after the holidays, either, the ministry said. Such eggs now sell for an average of NIS 12.50 a dozen.

Special-category eggs, like free-range and organic eggs, generally cost around twice as much as regular eggs, and currently sell for up to NIS 23 per dozen.

On Monday, the Trade and Labor Ministry announced that bread prices were to rise by 6.53 percent. In Israel, the state regulates the prices of basic white bread and basic dark.

In its statement, the Ministry said that the price hike is a direct result of the steep incline in international wheat prices in the past month. The price of flour is a significant component of the controlled-price. The increase in gasoline prices also contributed to the rise of bread prices.