On Monday, Tnuva, a prominent food manufacturer in Israel, announced that it would increase the price of hundreds of its products.
However, a major supermarket chain announced almost immediately that it would not comply with this move.
According to the announcement, the hike in price will go into effect on November 22nd, Wednesday, and is expected to have an impact on almost all of the dairy products of the company that do not have their prices regulated by the government.
These dairy products could include different kind of milk, butter and cheese products, along with some non-dairy substitutes like oat-based and soy-based tofu and beverages.
Overall, an increase of 4.7% is expected in the prices of the products. There are also some exceptions to the increase in prices.
These include some unregulated basic food items like lactose-free milk, certain yogurts and cottage cheese, which had served as the epicenter of the consumer boycott in Israel in 2011 over a rise in cost of living.
Tnuva issued a statement explaining that the cost of raw milk had risen sharply, which resulted in the increase. It said that since 2019, there had been a 24% increase in the price of raw milk, which had increased the company’s expenses by NIS 400 million.
The company also asserted that since 2018, the prices of its unregulated products had remained unchanged.
But, it should be noted that the price of raw milk had dropped back in 2014, but Tnuva had not lowered the price of its dairy products.
The expected net profit of Tnuva for this year is expected to be around NIS 300 million, which would be a 30% drop as opposed to its net profit last year.
The announcement from Tnuva comes while the company is dealing with the backlash from public over a number of incidents in recent months where its frozen vegetable products contained animal parts.
After Tnuva’s announcement of hiking its prices, Shufersal, the largest supermarket chain in Israel, said that it would remove the products off its shelves in protest of the planned price hike.
A statement from the supermarket said that just how they had disapproved similar attempts by other providers, it would do the same with Tnuva.
Previously, the supermarket chain had boycotted products of Tara, another major producer, as well as Gad Diaries, as the two had also hiked their prices a couple of months ago.
There have been consumer boycotts against importers and manufacturers because of higher prices. Strauss Group, the food manufacturer giant, has not announced plans of hiking prices of its dairy products.
The Israeli Dairy Board had given its approval in August for a 4.95% rise in prices of regulated dairy products, such as cheese, milk and butter.
The rising cost of living has become a big problem of late and Benjamin Netanyahu, whose political bloc emerged victorious in the elections, said in his campaign that addressing the issue was a priority for him.