Israeli Food Prices Surge at Record Pace, Study Finds
Translated & summarized from Mignews by baba
Food prices in Israeli supermarkets have increased at a record pace over the last four years, according to a Tel Aviv University study. Researchers found that prices in small stores rose by 19.6% and in discount chains by 14.5%, with Shufersal seeing the largest jump. The study attributes the surge to weakened government oversight and market monopolies rather than external economic factors. Experts emphasize the need for structural reforms to address the issue, as temporary measures have proven ineffective.
The story in 7 lines · by baba
- Israeli food prices have risen nearly five times faster in the last four years than in the previous period.
- A Tel Aviv University study analyzed 80 basic goods across 700 locations from 2018 to 2026.
- Small stores saw a 19.6% price increase, discount chains 14.5%, and Shufersal over 22%.
- Researchers blame weakened government oversight and market monopolies for the price surge.
- Government committees on the cost of living have been inactive since mid-2024.
- The OECD has repeatedly called for market liberalization in Israel.
- Temporary government subsidies have proven ineffective in controlling inflation.
The cost of everyday groceries in Israeli supermarkets has risen nearly five times faster in the past four years compared to the previous four-year period, according to a study by Tel Aviv University. Researchers Professor Itai Ater and doctoral student Adi Omer analyzed the prices of 80 basic goods across 700 retail locations nationwide from 2018 to 2026. Their findings indicate that prices in small neighborhood stores increased by 19.6%, a significant jump from the previous 4.3% rise, while discount chains saw a 14.5% increase, up from 2.8%. The "Shufersal" chain experienced the most substantial price hike, with a basket of goods increasing by over 22%, adding 231 shekels compared to just 6 shekels in the prior four-year span.
The study attributes this sharp rise not to external factors like currency fluctuations or global logistics costs, which have reportedly stabilized or decreased, but rather to weakened government oversight. Researchers suggest that the authorities' focus on prolonged military operations and political disputes has allowed monopolies and large retailers to raise prices without significant opposition. Systemic government work on the issue has reportedly stalled, with the interdepartmental committee on the cost of living not meeting since the summer of 2024 and the Slavin commission concluding without practical solutions.
Israel's food market has long been characterized by high capital concentration and protective customs barriers, with the state comptroller noting that three suppliers dominate over 85% of sales in most categories. The OECD has repeatedly called for market liberalization and reduced trade barriers, but government reforms have yet to significantly impact major food industry players. The current economic climate, marked by a prolonged crisis, has also prevented widespread consumer protests, enabling companies to maintain their market dominance. Previous government attempts to curb inflation, such as an agreement with Carrefour to lower prices on 100 items in exchange for 25 million shekels in advertising support, proved ineffective, as the chain raised prices on other products. The discontinuation of this program in mid-October is expected to cause a 30% price increase on the subsidized items, highlighting the need for structural reforms over temporary subsidies.
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