January 12, 2015

Closure of Streit’s Lower East Side Factory Reflection of Changing Matzoh Scene

New York…The announcement of the imminent closure of the Streit’s matzoh factory on the Lower East Side is more about the changing Matzoh situation in the US than it is about Streit’s, industry sources say. American manufacturers like Manischewitz and Streit’s have faced a number of challenges in recent years that have dramatically changed the landscape for the domestically produced Matzohs. One major challenge was the competition from Israeli and other foreign Matzoh producers who flooded the American market with cheaper Matzohs. A growing Orthodox Jewish community has opted for the hand-made Shmurah Matzoh, again cutting into the machine made Matzohs business of the two major American manufacturers. Demographic changes have also cut into Matzoh sales in many markets as younger assimilated Jews no longer followed the tradition of their parents. Matzoh had also become a loss leader in many American supermarket further squeezing the manufacturers.

Despite these challenges, the century-old family owned Streit’s retained about 40% share of US Matzoh sales. According to Aron Gross, a descendant and namesake of founder Aron Street, demand for Matzoh has risen year-round even by non-Jews as the large “cracker sheets,” are considered healthy and tasty options to bread.

Despite the fact that Streit has also been growing as a general food company with many interesting products imported from Israel, Gross says that “we are fundamentally a Matzoh company.” But the New York City facility with its antiquated equipment no longer made sense for Streit’s. It is planning to continue and even grow in a New Jersey facility, possibly as an extension of its Moonachie NJ plant where it manufactures macaroons. The family stands to gain some $25 million from its building on Rivington Street, which will no doubt be a dream for developers. It is estimated that US Matzoh sales in 2014 reached approximately $86 million. Sources told Kosher Today that 80% of Matzohs are still produced by machine with 20% handmade.