The Israeli market for milk, eggs and poultry stands on the brink of an historic transformation, as the government moves to abolish domestic quotas,
Globes reported on Monday.
Industry sources say that the array of boards governing agricultural production are largely responsible for the high cost of food in Israel, and the plan to do away with them will allow the basic commodities to reach a price level without manipulation by interested parties.
Among the entities slated for demise are the Israel Dairy Board, the Egg and Poultry Board, the Israel Plants Production and Marketing Board, the Israel Wine and Grapes Board, the Israel Ground Nuts Production and Marketing Board, the Israel Cotton Board, and the Israel Honey Production and Marketing Board.
A prominent wholesaler told Globes: “If the boards are abolished, there will finally be a market that operates cleanly, and I believe that there will be competition and that prices will fall. It will be good for the consumer, and it will be good for the wholesaler. It will also be better for the farmers, because they will act rationally and not be pushed around. At present, they are managed by a group of people with their own interests.”
The boards were created to manage the agricultural economy so as to ensure regular supply of produce to consumers while preventing dumping on the market.
The new era being opened up by the Ministry of Agriculture and the Ministry of Finance will likely result in some fluctuations in supply and prices until the markets stabilize, but officials believe that in the end the prices will be significantly lower and supply will be reliable.
“There’s nothing we haven’t considered,” said one official. “The farmers are aware of the fact that we will meet with them after matters are concluded between the ministries. It’s agreed that things should be done by consent; that is, we won’t go over the heads of the farmers. The aim is to ensure that it will remain economic for the farmers to produce, even though everything is being opened up to imports.”
The government has promised to compensate the farmers directly, much as subsidies are provided to farmers in Europe. In fact, OED officials were consulted in drawing up the Israeli plan.
“We aren’t inventing the wheel. This is how it’s done in the developed countries,” the official said.