Egg, milk and chicken prices are expected to rise by up to 17 percent by the end
of this year, the Agriculture Ministry forecast Wednesday.
A study
conducted by the ministry’s Research, Economy and Strategy Division said the
price increases can be attributed mainly to the prolonged drought in the US,
which has triggered a rise in the cost of agricultural commodities.
Grain
prices, it added, are expected to increase by 50% by the end of the
year.
Consumers, the study said, can expect to see a 13% rise in milk
prices and a 14% increase in the price of chicken and turkey. The largest price
increase outlined in the report, however, was for eggs, which it said could
become 17% more expensive.
The report was published just one day after
the price for a loaf of bread under government supervision rose
6.53%.
The Industry, Trade and Labor Ministry, which is responsible for
bread, said the hike was caused by sharp appreciation in the global price of
wheat in the past month that inflated the price of flour.
Labor
chairwoman Shelly Yechimovich issued a statement following the Agricultural
Ministry’s announcement Wednesday, in which she said that although the reasons
for the price increases are external, the government is exacerbating the
situation.
“Instead of easing the situation of the poor and the middle
class, whose purchasing power is weakening, [Prime Minister Binyamin] Netanyahu
and [Finance Minister Yuval] Steinitz are worsening the situation through their
economic directives and value-added tax increase,” she said.
MK Amir
Peretz (Labor) slammed the government for not holding a proper discussion on how
to deal with the rising cost of living. The continuous decisions to increase the
price of basic products are “putting everything on the backs of the sectors that
bear all the burdens in Israeli society – the poor, the middle class and young
couples.”
“Unfortunately the government isn’t even holding discussions
before it makes a decision on this,” he said.
Closing down his butcher
shop at Tel Aviv’s Carmel Market late Wednesday afternoon, Kobi Matityahu said
the imminent price hikes “just make a hard situation harder.”
The family
business his father opened decades earlier has already felt the bite of higher
consumer prices over the past year, according to Matityahu, who said “we already
see people buying less than before. It’s the type of thing that could close down
the business.”
With typical Israeli dismissive optimism, the 39-yearold
added “but we have these ups and downs a lot, we’ll get through it.”
In
central Tel Aviv, Tomer Levi, 38, the owner of the ice cream store chain “Fruity” said the expected price hike on milk will merely be
the latest blow to a business that has been steadily declining over the past
year.
“We already feel it. In 11 years we never had a year like this.
People I used to see every day I maybe see once a week now.”
Levi added
that higher taxes and price increases on supplies like milk are falling on
consumers who are increasingly choosing to pocket the expendable income they
would have spent on ice cream on a hot summer day.
“It’s bad now but just
wait, after the holidays, it’ll only get worse,” Levi added.
In
September, gas prices are expected to rise 40 agorot to a record high NIS 8.25
per liter.
The higher price is comprised of a 30 agorot per liter
increase due to oil prices and the one percent increase in value-added tax set
to take effect.
The final price of a liter of gasoline may be adjusted
before the end of the month, but in any case fuel is expected to cost more and
for the first time pass the NIS 8 per liter benchmark.