Israeli Food Prices Soar Nearly 20% in Four Years, Study Finds

Food prices in Israel have risen nearly 20% over the past four years, a rate almost five times faster than in the preceding four-year period, according to a study by Professor Itai Ater and doctoral student Adi Omer from Tel Aviv University's Coller School of Management. The research, published by "Yedioth Ahronoth" and "Mako," analyzed the cost of a fixed basket of 80 popular food items across approximately 700 stores from major retail chains, using data from the Pricez system. The study compared two periods: September 2018 to August 2022, and September 2022 to August 2026. Researchers found a significant price acceleration starting in 2023, continuing through 2024 and 2025, following a period of relative stability. The most substantial price increases were observed in smaller urban and neighborhood supermarkets, with prices rising by an average of 19.6% in the recent four-year period, compared to 4.3% previously. Online stores saw a 19% increase versus 4.1%, and discount chains experienced a 14.5% rise compared to 2.8%. The Shufersal Deal chain recorded a 22.7% increase, or 231 shekels, for the basket, a stark contrast to the previous four years' 0.6% rise. Shufersal Sheli and Freshmarket saw 19.6% increases, while Victory rose by 16%. Rami Levy and Yohananof saw smaller increases of 10.3% and 8.5% respectively, with Rami Levy remaining the cheapest chain studied, followed by Yohananof. Tiv Taam and Shufersal Deal were identified as the most expensive.

Online purchases also showed significant price hikes. Shufersal Online's basket cost increased by 24%, or 247 shekels, compared to almost no change in the prior four years. Victory Online and Rami Levy Online saw increases of 18.6% and 14.1%, respectively. The study highlighted specific product price surges, such as a 77.9% increase for a 100-gram bar of Elite's "Parah" milk chocolate in neighborhood supermarkets and a 57.6% rise in discount chains. An 800-gram package of Maadanot cheese burekas rose 30.9% in urban supermarkets, and a 200-gram jar of Taster's Choice instant coffee increased by 26.1%. A kilogram of Sugat jasmine rice in discount chains rose 17.7%.

Researchers attributed the price hikes to factors including increased VAT, higher costs for fuel, electricity, and water, rising municipal property taxes, and increased prices for state-regulated goods. They noted that despite a strengthening shekel and a global decrease in food prices after a 2022 peak, these factors should have moderated price growth in Israel. The study authors argue that rising production and import costs alone do not explain the significant price increases, pointing instead to a lack of adequate government oversight and public attention to the high cost of living. "When public attention is focused on other issues, food market companies take the opportunity to raise prices," the researchers stated.