Food Giants Dominate Israeli Market with Over 50% Share in Most Categories

Despite the appearance of numerous brands on supermarket shelves in Israel, a small number of major food companies hold dominant market shares in many categories, according to recent data. The Central Beverage Company, for instance, controls approximately 92% of the regular cola market, valued at 524 million shekels annually, and similar high percentages in diet cola and iced tea. Strauss holds significant sway in coffee and dairy, with around 87% of the Turkish coffee market and substantial shares in yogurts and toddler milk desserts. Osem leads the cracker market with 89%, while Unilever dominates mayonnaise and breakfast cereals. Tnuva also maintains strong positions in milk, cottage cheese, and yellow cheese.

Data from 2025 indicates a slight increase in market concentration, with the top ten suppliers holding 48.8% of the market and the top twenty holding 60.7%. This consolidation occurred even after shelf arrangement changes intended to benefit smaller suppliers. A comprehensive Knesset review found market concentration exceeding 50% in 36 out of 38 categories examined, with the top three companies in 20 categories holding over 85% of sales.

The issue of market concentration is further complicated by the "basket effect," where a supplier with a dominant product can leverage its position to negotiate better terms for its other numerous products. This contrasts sharply with the low penetration of private-label brands in Israel, which stand at about 6.9% of sales compared to an average of 36% in Europe. A strong private-label presence is seen as a key tool for retailers to counter the power of large suppliers by offering cheaper alternatives and reducing reliance on single dominant brands.

While large companies benefit from economies of scale in production and distribution, their market dominance, especially when combined with high market shares across multiple categories, raises concerns about competition. The Israel Competition Authority is examining whether the sheer size of a supplier's product basket constitutes an unfair advantage, even without explicit tying agreements. The authority has also expanded its scrutiny of mergers involving large companies acquiring new product categories, recognizing that the problem in the food market is systemic rather than isolated to single monopolies.