Food Prices Skyrocket in Israel, New Study Finds

A new study from Tel Aviv University reveals a dramatic acceleration in food price increases in Israel over the past four years, with prices rising five times faster than in the preceding four-year period. Between 2018 and 2022, the average cost of a basket of 80 popular grocery items increased by approximately 50 shekels. However, from 2022 to 2026, this cost surged by over 220 shekels. The study, which analyzed monthly average prices after discounts in about 700 stores, found that online and neighborhood store prices rose by at least 19%, while discount chain prices increased by 14.5%.

Major supermarket chains Shufersal and Victory saw particularly steep price hikes. At Shufersal, an online grocery basket increased by 247 shekels between 2022 and 2026, compared to just one shekel in the prior four years. In Victory's discount stores, the basket price rose by 160 shekels, versus 12 shekels previously. Rami Levy, another major chain, showed smaller increases, partly because it had already raised prices significantly between 2018 and 2022.

Specific products that saw notable price jumps include Elite milk chocolate, which increased by 78% in Shufersal's neighborhood stores, and Taster's Choice instant coffee, which rose by 26%.

Researchers Professor Itai Ater and Adi Omer attribute the accelerated price increases, which began in early 2023, not only to rising costs of VAT, property taxes, water, electricity, and regulated goods, but also to a lack of government intervention in addressing the cost of living. While a strengthening shekel and falling global food prices could have mitigated import costs, the researchers argue these factors alone do not explain the surge. Professor Ater stated that public vigilance had previously helped curb price hikes since 2011, but this mechanism broke down in 2023, allowing companies to exploit the situation. He emphasized the need for decisive government action to promote competition and combat the high cost of living.