couponing in the holy land

Frugal food shopping for the Anglo Israeli

A real look at the price of food in Israel

report came out last week from the Knesset comparing prices in Israel to other OECD countries and analyzes the possible reasons along with debating the necessity for a new law to increase competition in the food industry.  There are so many things I would like to share with you from the report, but I will start with the graphs.

image

This shows the real change in the Consumer Price Index from 2005-2013.  The US and the EU are at 1.8% whereas Israel is at 16%- the highest of all of the nations.

image

This shows the sales tax percentage on food in 2010.  Israel is at 12%, the OECD average is 8.9%.  The US, Canada, and the UK are 1% or less.

image

This chart shows what percentage of the market the top three manufacturers control, split into different food groups.  The most striking is dairy products, where the top three companies control 90% of the market.  Of course since Israel is a small country, it naturally has less manufacturers than the US or EU, for example.

image

This chart shows what percentage of the market each supermarket chain has.  Shufersal is #1 with 34%, Mega has 20%, Rami Levy only 8%, Yaynot Biton 5%, Kimat Chinam 4% and the rest have 29%.

image

The good news is that the hold the two main supermarket chains have on the market has slowly been decreasing since 2007- from 69% to 56%.

image

This shows the five main food companies in Israel (Strauss, Osem, Tnuva, Unilever and The Central Organization for Soft Drinks) and what brands are theirs.

 

image

This chart shows the percentage of the market held by private brands in 2009.  Israel is at the bottom with 5% and the average is 23%.

image

image

image

Of course, the manufacturers have expenses as well.  The top chart shows that the price of electricity went up 36% for Israeli manufacturers as compared to 63% for the EU.  The middle chart shows that the price of workers went up the same in the EU as in Israel.  The bottom chart shows that Israeli manufacturers pay a much higher amount for property tax than other OECD countries- 84.7 thousand shekels as compared to the average 38 thousand shekels.

image

This chart, however, was the big shocker.  Here we see the difference between the EU and Israel regarding food- in Israel prices jumped 16% since 2005 and the EU jumped 1.8%.  The first group, however, innocently called “miscellaneous” jumped 54.9% for Israelis and 2.3% for Europeans.  What is included in that group? cigarettes/tobacco, toiletries and cosmetics, jewelry, bags and office supplies, infant products and legal services.  

Where has Israel succeeded in lowering prices?  Education went down 4.9% in Israel and went up 24.2% in the EU.  Transportation went down as well by 8.6% whereas in the EU it went up by 6.1%.

In my next post I will talk about the proposed new law and what the committee’s recommendations were.

 

Advertisements

Single Post Navigation

3 thoughts on “A real look at the price of food in Israel

  1. Debbie on said:

    Fascinating! Especially the fact that housing prices went up more in the EU than in Israel in the years studied.

  2. joshinariel on said:

    About private brands, the Israeli supermarket chains failed and still fail miserably. I think they made a reasonable try, but don’t bother to push their own products. Regularly, you’ll find that: they do not give better shelf space to their private products, the prices are not significantly cheaper and sometimes even more expensive (!?), and in the Mega, besides the weird [unappealing to me] packaging, the private brands I checked do not have badatz or mehadrin kashrut.

    In the 90s, Clubmarket brought Canadian Loblaws successful private label to Israel, but when they got bought out, that stopped. Recently Osher Ad is bringing some as well. Behatzlacha.

  3. Pingback: Encouraging competition to lower prices- Part 2 | couponing in the holy land

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: