Israeli Economy Ministry Raises Price Cap by 30% for Competitive Yellow Cheese Imports

Six months after allocating a competitive import quota for yellow cheese priced between 3.1 and 3.5 shekels per 100 grams, the Israeli Ministry of Economy has issued an additional quota but increased the consumer price cap by about 30%. The ministry explained that the price hike aims to make the product accessible to neighborhood grocery stores by incentivizing importers to supply these smaller outlets. This new move seeks to expand the availability of yellow cheese at controlled prices to more sales points, even as importers who won the initial quotas earlier this year have imported less than 60% of their allocated amounts.

Unlike previous competitive quota allocations where importers bid prices down to win quotas, this time the quota committee set the price after reviewing market prices of leading brands. The chosen price is significantly lower than major brands but still profitable enough for importers and retailers to market the cheese in small and remote stores. The new quota covers 3,000 tons of yellow cheese duty-free, granted to importers who commit to selling it at no more than 4 shekels per 100 grams in participating chain stores or 4.5 shekels per 100 grams in other outlets such as grocery and mini-markets.

By comparison, importers awarded quotas earlier this year committed to prices between 3.1 and 3.4 shekels per 100 grams in delicatessens, or 3 to 3.5 shekels per 100 grams for packaged cheese in refrigerators. Five companies competed for the new quota, with four winning; these companies currently supply about 600 sales points. Since the start of the year, only 3,187 tons out of the 5,503-ton quota have been imported. The ministry expects this initiative to boost market competition and put downward pressure on leading brand prices.

To encourage broad participation from importers and retailers, the quota committee will also allocate a 45% bonus quota for duty-free premium cheese imports. This is expected to increase the variety of quality cheeses available to consumers at competitive prices. Danny Tal, chairman of the quota committee, stated, "Allocating duty-free quotas is a significant tool to increase market competition. While yellow cheese is already available at about 3 shekels per 100 grams in networks that won the previous quota, the new quota will expand the supply of affordable cheese to additional chains and many more sales points across the country, thereby enhancing competition and continuing to pressure prices downward."