June 29, 2009

Israelis Expect 10% Drop in Exports of Foods

Tel Aviv…KosherToday Israel Bureau Chief…Israeli food exporters are feeling the overall decline in food sales because of the global economic slowdown. The Marker reports that when less humus is ordered in Manhattan, Israeli food companies feel the losses. First quarter export sales fell by 21 percent compared the same quarter in 2008. Total sales for the period were $182 million. However the Export Institute expects this year to end in an overall drop of 10 percent in sales. Leading food exporters like Gat, Gan Shmuel, Gilam, Gadot, Negev spices, Strauss, Osem (Tivoll) ended 2008 with sales of 450 million dollars. Gan Shmuel, which produces juices and fruit concentrates is said to be the country’s largest exporter with sales of 200 million dollars in 2008.

The economic slowdown affects food companies differently. For example, the larger manufacturers Strauss and Osem who have revenues in the billions of shekels devote a very small part of their business to exports so that they are feeling the recession less. However, those middle-sized companies which export the majority of their products have been hard hit by the slowdown. David Archi, Director of the Export Institute, said that while food sales represent only two percent of Israel total exports, 2008 saw earnings of 872 million dollars compared to 846 million in 2007. “The Israeli company that specializes in niche products, gourmet and ethnic foods has been affected,” said Michal Neeman, Director of the Export Institute Department of Business Development. “The only exception are the exporters focusing on the kosher markets abroad mostly in the US and Britain.” She said those markets are remarkably stable. Neeman said those who require kosher food are a captive market and this includes Moslems who prefer kosher food because they know that Judaism and Islam share the ban of the consumption of pork products.