The cost of living in Israel is like the weather. Everyone talks about it, but no one does anything about it. Reports were recently published about how food in Israel is 25 percent more expensive than in Europe due to high customs rates, about cartels that prevent competition, about cumbersome bureaucracy and high taxes.
But there are more sophisticated, secretive mechanisms in place to keep prices high. We’ll consider one of them today, and then we’ll better understand why apples are so expensive here: between 9 shekels and 15 shekels ($2.50-$4.20) per kilogram.
The government’s general policy is to curb imports of fruit and vegetables in an effort benefit farmers, at the expense of consumers, by keeping the prices high. Israel levies an import tax of 2 shekels per kilogram on apples from Europe, which, along with other shipping costs, effectively prevents apple imports. But this year, due to a poor apple harvest, the Agriculture Ministry allowed 3,300 tons of apples to be imported tax-free from Europe, along with 4,000 tons from the United States. Together, that’s 7 percent of Israel’s yearly apple consumption, which has a negligible effect on prices, but even that little bit of import had farmers associations up in arms, lashing out at the government.
Agriculture Ministry officials don’t like imports either. They prevent the importation of bananas, plums and citrus fruits, saying they contain pests that could harm local agriculture. But U.S. and European governments are not making such claims.
If you’d like to import apples from, say, Poland, you can’t, because prices there are too low. You are allowed to import from Italy, France, Spain or the United States, because their prices are high — so you wouldn’t want to in the first place. Catch 22, anyone?
Say you’re stubborn and decide to import apples from Poland anyway. Then the Agriculture Ministry’s department of plant protection will begin the process of researching plant pests in Poland. That, of course, will take years, because the department of plant protection has only one employee to do such research, which is yet another way to effectively prevent importation.
Recently, importers have been confronted with a new kind of craftiness from the Agriculture Ministry. Up until November 2013, inspectors would take two or three crates out of every shipping container, inspect them, and then allow them through most of the time. But since December 2013, those same inspectors have been begun taking 10 to 12 crates out of each container, emptying them out on dirty tables in Haifa port hangars, and then inspecting each and every apple with a magnifying glass.
They’re doing it to find a dead bug, or a bit of fungus. If you look hard enough, you’re bound to find something. When they do, they disqualify the whole container. If they don’t find bugs or fungus, they call in an insect expert, a retired researcher from the ministry's Agricultural Research Organization, to find something that can disqualify all 100,000 apples in the container. Dozens of shipping containers were disqualified in this manner over the past month. One expert told me that if they would check Israeli produce like this in Europe, not a single fruit would get through, and exports to Europe would essentially stop.
The Agriculture Ministry doesn’t share these reports in full with the importers, so they can’t even tell the exporters in Italy or France why their crop was turned down. The ministry also refuses to allow examination of the “contaminated” apples in independent labs, so many exporters have already declared that they will no longer work with Israel.
That’s welcome news for the Agriculture Ministry. Preventing importation in order to keep apple prices high is exactly what they’re trying to do. The ministry represents the farmers — so why should it care about the cost of living in Israel?