The end of the war with Iran and the summer travel season are expected to cool Israeli grocery spending, but food companies have found a new growth channel: sales to Gaza. After the ceasefire in the Strip came with a pledge to allow hundreds of trucks of food and supplies in each day, Israeli businesses began taking a cut from the reconstruction and aid economy, adding hundreds of millions of shekels to food-company revenues. Many firms prefer not to publicize the sales, partly out of concern for reputational damage as the military says Hamas is rebuilding and growing stronger.
The secrecy forced the Securities Authority this week to make Victory disclose that it sold about NIS 100 million of goods to Gaza traders in one month. Victory had attributed the jump in sales to Passover and the Iran war, without identifying the main source. Shikma Marketing, controlled by Rami Levy, said it had obtained a license but did not use it and did not sell to Gaza during wartime. Calcalist found that about 30 companies hold licenses to supply Gaza, including Mehadrin, which sold about NIS 60 million in the first quarter, as well as Carrefour, Super Sapir, Hazi Hinam, Maayan 2000, Neto, Willi-Food, Bikkurei Sadeh, Diplomat, Shastovitz and S.Niv.
The route has also exposed repeated smuggling attempts. Super Sapir recently discovered cigarettes hidden inside boxes of Pringles supplied by an Arab-sector vendor for transfer to a Gaza merchant and immediately reported it to security officials. A few weeks earlier, hundreds of kilograms of tobacco were hidden in canned grape leaves. A COGAT source said such attempts can surface either during warehouse loading or only at the Kerem Shalom inspection point.
The system was built after Israel tried to prevent Hamas from taking over Gaza’s food supply. During the January 2025 ceasefire agreement, 33 hostages were to be released and about 600 trucks a day were to enter Gaza, but the UN and aid groups could handle only around 200 trucks daily. The Defense Ministry then turned to private Israeli suppliers, while customs imposed strict conditions, including security checks, cameras, GPS tracking, fenced storage areas and limits on the height of pallets. Suppliers say Gaza traders mainly order snacks, soft drinks, cookies, tuna, Pepsi and frozen fish, not staples such as flour, sugar, rice and oil, which aid groups already provide.
At first, demand was so strong that merchants paid as much as five times Israeli prices, but as supplies increased, prices and margins fell. Victory said its gross margin slipped to 23.1 percent from 23.9 percent, while Mehadrin earned only NIS 4 million gross profit on NIS 60 million in sales, a 6.6 percent margin. Even so, the traffic is expected to continue, and more companies may join the narrow group of approved suppliers.
