Israeli Grocery Prices Surge Fivefold Over Four Years, Study Shows

Food prices in Israel have accelerated at nearly five times the rate recorded in the previous four-year period, according to a comprehensive new study by Prof. Itai Ater and doctoral student Adi Omer from the Coller School of Management at Tel Aviv University. The research is based on continuous tracking of a fixed basket of 80 popular products across approximately 700 branches of major retail chains, utilizing Pricez system data collected under the Food Law.

The analysis compares two four-year periods: September 2018 through August 2022 versus September 2022 through August 2026. The findings reveal a severe wave of price hikes beginning in 2023 and continuing steadily through 2024 and 2025, following a preceding four years of relative price stability. The steep increases are felt across all retail channels, translating into hundreds of extra shekels added to the monthly budgets of Israeli households.

Significant Hikes Across Neighborhood Stores and Discount Chains

According to the study, neighborhood convenience stores (including Tiv Taam City, Fresh Market, Shufersal Sheli, and Carrefour City) saw their basket prices surge by 19.6% over the past four years, compared to just 4.3% in the earlier period. Online retail channels recorded a 19% jump, up from 4.1%, while discount supermarket chains registered a 14.5% increase, compared to a mere 2.8% between 2018 and 2022.

Discount chains evaluated in the study include Rami Levy, Yohananof, Shufersal Deal, Victory, and partially Carrefour Hyper. In monetary terms, these jumps represent an addition of hundreds of shekels to a family's monthly grocery bill, a stark contrast to the single-digit shekel increases seen in the prior timeframe. Shufersal Deal experienced a 22.7% surge in its basket price—an extra 231 ₪—compared to a 0.6% rise previously.

"Following four years of relatively moderate increases, a sharp acceleration was recorded across all sales channels. The blow is particularly harsh on low-income families, who spend a larger share of their income on food. The massive gap between the periods proves that the cost of living is not an unavoidable decree," noted Prof. Itai Ater.

The Impact on Basic Household Staples

Individual product tracking demonstrates the sweeping nature of the inflation. Elite's 100g Parah milk chocolate bar saw its price skyrocket by 77.9% in neighborhood branches, climbing from an average of 5.21 ₪ to 9.26 ₪. In discount chains, the price advanced by 57.6%, rising from 4.93 ₪ to 7.77 ₪, while online platforms experienced a 73.5% surge.

Similarly, Eden's frozen cheese bourekas (800g) increased in average price by 30.9% in urban stores, moving from 19.15 ₪ to 25.07 ₪, after actually dropping by 8.4% in the previous period. Taster's Choice freeze-dried instant coffee (200g) climbed 26.1% in neighborhood supermarkets to 39.60 ₪, following complete stability in the preceding four years.

Regulatory Vacuum and Lack of Government Action

The researchers analyzed the primary drivers behind the price surge, pointing to hikes in VAT, fuel, water, electricity, municipal property taxes (arnona), and regulated goods. However, the authors emphasize that parallel macroeconomic factors—such as the strengthening of the shekel and a sharp decline in global food price indices from their 2022 peak—should have lowered import costs and mitigated domestic price increases.

The study concludes that cost changes alone cannot account for a sweeping 20% across-the-board inflation. The central catalyst, according to the authors, is a regulatory and public vacuum. When public and media attention is diverted to other matters, food market corporations exploit the opportunity to raise prices, signaling an urgent need for genuine government intervention and systematic removal of market barriers.