Osem-Nestlé has joined the wave of price hikes announced by Israel's leading food manufacturers and has told retailers that it is raising prices on some of its products by an average of 3.4%.
The company explained that in the last two years it has had to absorb, "Huge price increases on an unprecedented scale for raw materials, packaging, transportation, energy and more, a trend that is continuing in the current months," and therefore it has had to revise the price list for retailers of some of its products. The price increases will not apply to baby products like Materna and Gerber, or to Bamba snacks, coffee products, breakfast cereals, Nestlé chocolate and pet food.
Osem-Nestlé said that since January 2021 wheat prices had risen 60%, tomato concentrates 40%, coffee 45%, sugar 28%, oils 50%, durum wheat for pasta 75%, corn 33% and soya 13%.
Osem-Nestlé CEO Avi Ben-Assayag said, "This is not an easy decision for us at a time when inflation is affecting every family in Israel and so we are continuing to absorb most of the prices rises.
"In the past year, we took a series of significant streamlining measures, including cutting management salaries, reducing fixed costs, revising procurement agreements, laying off dozens of employees at the company's headquarters and in the commercial department, and more. Despite these measures, and due to high inflation, we have made a decision to mainly revise the prices of the products manufactured in our plants in Israel, which have 2,500 employees, out of a real need to face the challenges of the hour and at the same time maintain the stability of the company's plants in Kiryat Gat, Sderot and Yokneam.
"Precisely at this time, we have also chosen to raise the minimum wage for factory and field workers to NIS 6,000. The damage done by inflation is unprecedented and enormous in scope. It is important to say that after a decade in which no price list was updated, this is a moderate revision that only partially compensates for the price increases, most of which we will continue to absorb."
Last month Osem-Nestlé announced that as part of its streamlining plan, it was laying off dozens of employees, most of them salespeople as well as a small number of employees in the company's headquarters.
Published by Globes, Israel business news - en.globes.co.il - on December 15, 2022.
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