July 28, 2010

Israeli meat prices to soar on demand surge

Prices of fresh meat in Israel are expected to rise by 20%-30% in the near future due to rising demand following the easing of blockade on Gaza Strip and upcoming holidays.

"Following the flotilla affair, a decision was made to ease the blockade, and overnight the demand for calves went up by 50%," a cattle breeder said.

"Meanwhile, over the past year, consumers have been shifting from frozen meat to fresh meat and we are approaching the holiday season (the Jewish New Year and the Muslim holiday of Ramadan)," he said, adding that all these circumstances together have brought about a shortage in calves, and the breeders are raising prices.

The price increase was divided between the producer, who absorbs about 10% of the increase, and the consumer, who pays the remaining 20%.

"The Ministry of Defense prevented us from transporting cattle to Gaza last year," said Chaim Dayan, president of the Association of Israel Beef Cattle Growers (Ambal).

"In meetings held in early 2010, we were promised that ahead of Ramadan we would be able to transport cattle into Gaza. Since the flotilla incident, the crossings have opened and we've transported 2,000 calves. By (the Muslim holiday of) Eid al- Fitr, another 7,000 calves are estimated to have been transported to Gaza, causing a shortage in Israel."

Retailers in the chain stores said that suppliers have yet to raise the prices, but they admit they know the price will be updated in the next few weeks.

Another official in the field of cattle breeders explained that "there is always a price increase of 10%-15% on average before every holiday. This year it will be steeper because of the easing of the blockade on Gaza. In the two weeks before the holiday, when most of the holiday shopping takes place, the retailers will panic and ask for calves, but there won't be any."

According to figures from the Ministry of Agriculture, the fresh meat market makes up 35% of the entire beef market.