Shufersal supermarket chain bows to Tnuva price hikes, ending short-lived boycott

Retailer says it will bring back products that have no alternatives on the market, while keeping others off the shelves

People shop for food at Shufersal, on September 21, 2020. (Yossi Aloni/Flash90)
People shop for food at Shufersal, on September 21, 2020. (Yossi Aloni/Flash90)

Supermarket chain Shufersal said Tuesday it would acquiesce to dairy giant Tnuva’s price hikes on certain products, ending its boycott of the brand over the rising costs after only a few weeks.

Shufersal said in a statement that it will bring back only products that have no suitable alternatives on the market, while many will remain off its shelves.

It was doing so, it said, “due to the shortage in various dairy products at branches… and in order not to hurt the chain’s customers.”

Among the products returning to shelves are butter, various types of yellow cheese, cream, sour cream and tofu.

In mid-November, Tnuva announced the roughly 4.7 percent increase on hundreds of dairy products whose prices were not government-regulated, as well as on some non-dairy substitutes.

Shufersal, Israel’s largest supermarket chain, said it would oppose the price hike by taking the affected products off its shelves, as it previously did with other large food manufacturers like Unilever and Tara, the country’s second-largest dairy processor.

But with other retailers keeping the products in stock, Shufersal found itself alone in the fight and may have faced pushback from customers who were disappointed not to find their preferred products for sale.

A worker stacks dairy products at a Shufersal supermarket in the Golan Heights town of Katzrin, on July 1, 2022. (Michael Giladi/ Flash90)

Like all retail chains in Israel, Shufersal is largely dependent on Tnuva for many of its dairy products. Tnuva has explained the increases as being due to the “sharp rise of [the cost of] raw milk,” which has increased by 24 percent since 2019 and has added NIS 400 million ($115 million) in expenses to the company.

In Shufersal’s financial statements cited by the Calcalist business daily, the company makes note of its reliance on Tnuva, saying that if “Tnuva halts its supplies for any reason, the company will only be able to partially provide certain dairy products from other suppliers.”

In July, Histadrut labor federation chair Arnon Bar-David called for a public boycott of import giants Diplomat, Kimberly Clark and Schestowitz, all of which had announced price hikes amid rising costs of consumer goods.

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