Dairy prices to rise 2.2% [pg. 18]

Prices of regulated dairy products are set to rise by 2.18 percent, on average, Sunday, in a regular price adjustment determined by a government price committee. "The new prices reflect the rising cost of producing raw milk on dairy farms, as well as dairy facilities' rising production costs and falling profitability, on one hand, and the 1% VAT reduction on the other hand," said Agriculture Ministry price supervisor Itzik Ben-David. Ministry spokeswoman Dafna Yurista stressed that the price hike was not at all related to the war and that it was well within the range of previous yearly raises. "The raise is even lower than what was expected. The dairies asked for prices to rise about 4%-5%, so what was given was still far from what they wanted," she added. The price of eggs actually dropped because of the VAT reduction. The price committee - bringing together officials from the Agriculture and Finance Ministries - also recommended that the ministers cancel regulation on the price of 5% and 9% cottage cheese, arguing that the level of competition among producers was sufficient to allay concerns that the price would be set through a monopoly. Dairy and egg prices must be updated once yearly, or when production costs rise by 3%, whichever occurs first, the ministry said, noting that the previous adjustment was made in May 2005. Next week, a one-liter bag of fresh 3% fat milk will cost NIS 4.24 including VAT and 1% milk will cost NIS 4.09. The same milk sold in cartons will cost NIS 5.30 and NIS 5.07, respectively. A 100-gram packet of butter will cost NIS 2.70. Yogurt-like products called eshel and gil are also subject to the price hike, as are cream, sour cream, basic puddings, storable milk, and certain hard cheeses. The price of a dozen size-1 eggs (weighing over 70 grams each) will fall to NIS 9.75, while 30 eggs will cost NIS 21.75.