Light Barriers to Imports

OTA estimates total organic market consumer sales of Israel at about $90 million USD per year.

 

  • The total market size for organic packaged food and beverages in Israel in 2015 is US$71.6mn, making it the 28th largest market in the world by value.
  • Per capita spending on organic packaged food and beverages in Israel is US$8.6, which ranks as the 18th largest spending per capita in the world.
  • The largest company by sales in organic packaged food and beverages is All Organic Ltd, which maintains 20.4% of total sales, followed by Maabarot Products Ltd and Hasade Natural & Organic Products.
  • Organic packaged food and beverages in Israel will see moderate year-on-year growth of roughly 6% in 2015. This is slightly higher than the rest of the Middle East and Africa region, which will experience less than 6% year-on-year growth in 2015.
     
  • Israel maintains a market size for organic packaged food and beverages of US$71.6mn in 2015, which is 0.2% of global category sales.
  • Within the Middle East and Africa region, only Turkey surpasses Israel in total value sales of organic packaged food and beverages.
  • Israel will experience slow forecast growth of sales of organic packaged food and beverages, at 4.4% from 2015–2020.

QUALITATIVE ANALYSIS

Quick Facts

  • The total market size for organic packaged food and beverages in Israel in 2015 is US$71.6mn, making it the 28th largest market in the world by value.
  • Organic food and beverages have gained popularity among Israeli consumers in recent years.
  • However, organic packaged food and beverage companies will need to continue to prove their products’ value to Israeli consumers, who are typically skeptical of organic products’ premium prices.

Market Trends

Competitive Landscape

  • Regional and independent players have dominated the organic packaged food and beverage landscape in recent years. 
  • All Organic, with its established brand Harduf, remains the key player in the organic food space, while Ocha Tea took the top spot in organic beverages in 2014. 
  • Due to the limited size and growth potential in this market, multinational players do not play a significant role. 
  • The bulk of organic items continue to be sold in organic-oriented shops or on designated shelves in the health and wellness department. Products are generally not positioned in general store space next to non-organic items.

Prospects and Growth Opportunity

  • Government regulations that define organic food will prevent counterfeits and ensure the high quality of an increasing flow of imports. 
  • Companies that win in the organic space will do so by proving their value (unique flavor, preservative-free, chemical-free) to consumers who remain skeptical of organic products’ high prices, which are often twice that of non-organic products.
  • Retail channels have boosted marketing efforts for organic items, and more organic goods are set to appear on the shelves of large grocery chains.

General Health & Wellness Trends

General Economic & Demographic Landscape

Economy: 

  • Israel’s economy is set to grow at around 3.5% per year in the medium term due to increases in the production and export of natural gas. 
  • In order to further boost growth, increased investment in infrastructure is needed. 
  • Structural issues weighing on further economic growth include low labor participation rates, political insecurity regarding Palestine, above-average levels of economic inequality, and high levels of public debt. 
  • Israel is a leader in the fields of aeronautics, generic drugs, telecommunications, and biotechnologies, with one of the highest concentrations of high-tech companies in the world outside of Silicon Valley.

Population demographics: 

  • At 8.2 million in 2014, Israel’s population has more than doubled from 3.9 million in 1980. Fertility rates remain well above the replacement rate, at 3.0 births per female. 
  • Israel’s population is generally well educated. There is a high level of labor force participation amongst secular Jewish women, which has begun to slow birth rates in this portion of the demographic. 
  • Aging is taking place at a moderate rate, with the median age increasing from 24.8 years in 1980 to 29.8 years in 2014. 

Income & expenditure: 

  • With 20% of families living under the poverty line, Israel’s gap between rich and poor is one of the largest of all developed countries. This problem is exacerbated by low rates of labor force participation. 
  • Per capita consumer expenditure amounted to US$20,918 in 2014, and is set to grow at an annual pace of 3.2% through 2030. This growth will be driven primarily by higher spending on communications and education, as public budget cuts have caused parents to pay more for their children’s schooling.

QUANTITATIVE ANALYSIS

Organic packaged food & beverage data

Data type

2012

2013

2014

2015

2016

2017

2018

CAGR
(12-15)

CAGR
(15-18)

                   

Health & wellness products consumption

2,229.6

2,289.6

2,320.1

2,379.2

2,407.1

2,426.2

2,441.9

2.2%

0.9%

Organic packaged food and beverages consumption

57.2

62.1

66.7

71.6

75.6

79.2

82.6

7.8%

4.9%

Organic packaged food consumption

51.4

55.5

59.3

63.3

66.5

69.3

72.0

7.2%

4.4%

Organic beverages consumption

5.8

6.6

7.4

8.3

9.0

9.8

10.6

12.7%

8.5%

Organic packaged food and beverages consumption as a % of total health & wellness products consumption

2.6%

2.7%

2.9%

3.0%

3.1%

3.3%

3.4%

-

-

Economic & demographic data

Data type

2012

2013

2014

2015

2016

2017

2018

               

Total population

7.9

8.1

8.2

8.4

8.5

8.7

8.8

% Middle and upper class of total population

38.3%

38.3%

38.4%

38.4%

38.4%

38.4%

38.4%

% Population aged 65+

10.3%

10.6%

10.8%

11.0%

11.3%

11.5%

11.8%

% Population aged 0-14

28.2%

28.2%

28.2%

28.1%

28.1%

28.0%

27.9%

% Population with higher education degrees

34.0%

34.7%

35.4%

36.0%

36.6%

37.1%

37.7%

Average number of children per household

1.2

1.2

1.1

1.1

1.1

1.1

1.1

GDP per capita

32,559.9

33,700.5

34,266.7

35,343.0

35,722.4

36,279.1

36,924.1

Consumer expenditure per capita (US$)

17,890.9

18,556.1

18,986.7

19,363.7

19,817.7

20,265.1

20,701.1

Consumer expenditure per capita on food and non-alcoholic beverages (US$)

2,744.5

2,816.9

2,849.3

2,871.1

2,905.0

2,938.5

2,970.0

 

Retailer & urban area data

Data category

Rank

Urban Area/retailer

Population
(mns)

       

Top urban areas by population (2015)

1

Tel Aviv

3.6

Top urban areas by population (2015)

2

Haifa

1.1

Top urban areas by population (2015)

3

Jerusalem

1.0

Top urban areas by population (2015)

4

Be'er Sheva

0.6

Top urban areas by population (2015)

5

-

-

Top grocery retailers by sales (2015)

1

Shufersal Deal

-

Top grocery retailers by sales (2015)

2

Rami Levi

-

Top grocery retailers by sales (2015)

3

Yeynot Bitan

-

Top grocery retailers by sales (2015)

4

Mega Bair

-

Top grocery retailers by sales (2015)

5

Shufersal Sheli

-

USDA GATS data

Rank

2015

2014

2013

2012

1

Cherry Tomatoes 

Apples

Apples

Apples

2

Apples

 

Pears

Tomato Sauce

3

Tomatoes

 

Coffee Roast

Coffee Roast

4

Pears

 

Tomato Sauce

Cauliflower

5

Tomato Sauce

 

Spinach

 

Policy Information

Government Agency(s)/Competent Authority

Authorized Government Agency(s): 

Plant Protection Inspection Services (PPIS) in the Ministry of Agriculture and Rural Development of the State of Israel

Agency(s) Contact Information: 

The Ministry of Agriculture and Rural Development
The Plant Protection and Inspection Services
P.O. Box 78, Bet Dagan 50250
ISRAEL
Telephone: (+972 3) 9681500/01
Facsimile: (+972 3) 9681507
E-mail: ppis@moag.gov.il
Website

Organic Regulations and/or Standards

Name(s) of Regulation and/or Standard: 

Date of Implementation: 

1992

Regulation and/or Standard Scope: 

This initial standards covered to unprocessed plants and plant products, and processed products derived from plants, which carry or are intended to carry, descriptive labeling referring to organic production methods. Regulations for animal products were passed in 2013.

Imported Products Requirements

Imported Products: 

Certification to the Israeli standard is not a requirement for importing organic food into Israel. However, if an importer would like to utilize the Israeli organic seal then specific information documenting that the fruit meets Israel's requirements must be submitted to the Israeli Plant Protection and Inspection Service (PPIS).

Certification and Accreditation

Certification: 

Accreditation Method: 

Government

Accreditation: 

The Plant Protection and Inspection Services (PPIS) are the competent authority and sole accreditation body authorized to approve inspection bodies for organic production.

PPIS is recognized by the U.S. National Organic Program (NOP) to accredit certification bodies in Israel to certify to the NOP standards.

Additional Information

Additional Information: 

Israel is on the third country list for the EU.

USDA's GAIN Report Israel Food and Agricultural Import Regulations and Standards - Narrative (2016)
USDA's GAIN Report Israel Exporter Guide (2016)

Definitions

Review definitions of terminology included in this website.