Israel Butter Import Plan Falters

A severe shortage of butter looked likely to get worse as a government-sponsored plan to import the product has met with dissatisfaction in the Israeli dairy industry, Globes reported on Monday.

“No one can import at the price of butter overseas and sell at the controlled price. The butter shortage will continue. The situation is absurd,” importers were quoted as saying.

Companies expressed shock at word of a revised tender published by the Ministry of Economy and Industry, which set the price at NIS 3.80 per 100 grams. The initial tender did not fix a price.

The new scheme came with a warning as well for companies that don’t abide by the pricing deal: “In case of a deviation in the sale price for butter, the quotas committee is authorized to invalidate the rest of the importer’s license for that year, and the importer will not be entitled to quotas in the following year.”

One industry source complained that the price was totally unrealistic. “You can’t work on such a margin in refrigeration… (even if) the importer decides to lose money, the retail chain won’t agree to work on such a low net margin, because it also has many expenses.”

Meanwhile, an update from the Ministry of Agriculture and Rural Development sounded less anxious about a butterless marketplace.

“It takes two to three months after the quotas are distributed for butter to reach Israel, which means that a slight shortage of butter will persist at the current time,” the ministry said.

The Tara company was reportedly supplying butter to the retail food outlets in small quantities, but “the shortages are still severe, shelves are rapidly emptied, and consumers are buying large quantities for storage because of the shortage,” according to a source.

The Ministry of Economy and Industry said “the importers were given another week to submit bids. The committee will meet next Sunday to distribute the quotas.”