Pricing committee recommended that the price of bread be permanently abolished - price will rise

The inter-ministerial pricing committee, jointly with the Ministry of Economy and Industry and the Ministry of Finance, recommended that the price of bread be permanently abolished.
The issue of the removal of bread control was raised by the committee a year ago, but a hearing procedure and a final recommendation were now required - which has now been accepted. However, the required approvals have not yet been received from Finance Minister Avigdor Lieberman and Economy Minister Orna Barbibai.
Given the symbolic value of bread, economics and finance ministers have tried in the past to refrain from signing regulated bread prices, even in cases where there was ostensibly economic justification for it. The bakeries even appealed to the courts in cases where the prices committee or ministers refused to accept their demands to price the bread. Even now, ministers may find it difficult to sign a deregulation, given the rapid rise in prices in recent months.
The recommendation to remove the supervision was given in light of the high competition in the field between the bakeries, and also because of the rise in wheat prices, which is due in part to the war between Russia and Ukraine. The committee seeks to move from supervision to a model of ongoing monitoring of market competition.
The Control Act applies to five bread products: dark uniform bread, sliced ​​and packaged dark uniform bread, challah, white bread, and sliced ​​and packaged white bread.
The prices of bread under consumer supervision today are NIS 5.12 for dark bread and NIS 7.11 for sliced ​​dark bread. To plant bakeries, input prices continue to rise.
An analysis of Sterncast's data on the barcoded market, commissioned by the Prices Committee, shows that the total monetary sales of bread products sold in the retail chains in 2018-2020 were about NIS 1.5 billion a year. The total monetary sales of regulated bread at that time were about 270 million a year, which is about 18% of the entire bread market in the retail chains. Of the total sales of the large bakeries to the retail market, the regulated products constitute about 25% on average.
In recent years, there has been a change in the pattern of bread consumption in Israel. The share of supervised and light breads has decreased significantly, in parallel with the increase in the share of specialty breads, such as wholemeal bread, rye bread and whole grain bread. The main bread product consumed by households in the bottom quintile is pitas, whose prices are not monitored.
The Ministry of Finance stated: "The recommendation of the Prices Committee regarding the supervision of bread products was given after a public hearing was held and based on an in-depth analysis conducted in the market."