A Knesset Economics Committee discussion exposed why the stronger shekel has not translated into cheaper groceries and pharmacy products in Israel. Amit Tzadik, head of budget oversight at the Knesset Research and Information Center, summed up the problem by saying prices here “rise like missiles and fall like feathers.” The meeting focused on food prices, market concentration, and whether government policy is doing enough to pass currency gains to consumers.
The committee was shown data indicating that between August 2025 and April 2026, Israel’s real food price index rose 0.2%, while the European Union saw a 1.1% decline. Over a longer period, from January 2022 to October 2025, the global food commodities index fell 3.6%, but Israel’s consumer food index jumped 18.8%. At the same time, the shekel strengthened 19.8% against the dollar and 9.4% against the euro between January 2025 and May 2026. In June, the average dollar rate was 2.91 shekels, its lowest level since October 1993, and the euro averaged 3.33 shekels, its lowest since the currency was introduced.
Despite that currency strength, Israel’s food index rose 2.6% in the same period, and fruit and vegetable prices climbed 8.1%. MK Moshe Passal said the public no longer wants explanations and demanded a clear work plan from the Finance Ministry, the Economy Ministry, and the Israel Competition Authority to increase competition in the food market. The discussion centered on how to bring price cuts to shoppers.
Boaz Ackerman of Lobby 99 said that in 30 of 38 food categories, three companies control more than 70% of the market. He noted that while global coffee prices fell 22%, sugar 12%, and cocoa 60%, coffee and chocolate in Israel became more expensive. He called for reducing the power of exclusive importers, separating distribution systems from large suppliers, and taking further steps to boost competition.
Government officials outlined existing measures instead of announcing new immediate relief. Ron Shenkman of the Budget Department said the Finance Ministry is working to remove agricultural import barriers and advance a reform to ease imports of kosher products. The Economy Ministry pointed to its “What is good for Europe” reform as a model for opening markets, and the Competition Authority described enforcement steps including hundreds of millions of shekels in fines and blocking mergers deemed harmful to competition. Industry representatives argued that suppliers also face sharply higher input costs, citing increases of 62% in electricity, 53% in water, 27% in National Insurance payments, and 10% in the minimum wage. The committee ended without a new government plan, but it demanded concrete anti-barrier and pro-competition steps from the ministries and the regulator.
