Following calls for a consumer boycott against it, Osem-Nestle today announced that it was postponing its 4.5% price hike announced last week.
The food company said today that following a request by Minister of Finance Moshe Kahlon, Osem-Nestle CEO Avi Ben Asayag and chairperson Dan Propper had met with Kahlon "for a late-night discussion and notified him of their efforts to convince the Public Utilities Authority (electricity) to moderate the increase in electricity prices."
Osem-Nestle added, "The Ministry of Finance is considering the elimination of customs duties on a series of raw materials used by Osem-Nestle in its production in Israel." Osem-Nestle's management subsequently decided "to postpone its price hike at this stage."
Osem-Nestle is Israel's third largest food group, with an 8.5% share of the consumer product market. Its retail sales in Israel totaled NIS 3.5 billion in 2017. Osem-Nestle was delisted from the Tel Aviv Stock Exchange (TASE) in 2016 after being acquired by Swiss corporation Nestle.
After not increasing its prices for six years, Osem-Nestle last week announced that it would raise prices at the beginning of 2019. The company said that the 4.5% increase would apply to a third of its products, including Bisli and Petit-Beurre, while prices of products such as Bamba, Materna, coffee, pasta, cake, pretzels, most breakfast cereals, and salads would not be raised.
Osem's announced price hike, together with price increases by other food companies, such as Tnuva and Tara Dairy and the announcements of increases in electricity and water rates, awakened signs of social protest: demonstrations against price increases and the cost of living took place in Tel Aviv and Jerusalem late last week. There were also calls for a consumer boycott of Osem-Nestle in protest against the planned price hike, which has now been postponed.
Published by Globes, Israel business news - en.globes.co.il - on December 19, 2018
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