Minister of Industry, Trade and Labor Shalom Simhon today rejected reimposing price controls on dairy products. "There is a place for regulatory oversight, but not price controls, which would create empty shelves as in Eastern Europe," he said at the "Globes" 2011 Media, Communication and Digital Conference today.
Simhon promised to cut dairy prices by 10% and create competition in the market, which he claims will reduce prices by a further 10% over the next three years. "We must protect Israeli agriculture. Beyond its economic value, there are national values. We must protect Israeli industry, Israeli manufacturing that we built with our ten fingers and which no one will take away from us. But at the end of the day, we have an obligation to the Israeli consumer."
Simhon said that Israel's dairy economy was "number 1 in the world". He added, "This is a NIS 7 billion a year market, and we intend to reduce it by NIS 700 million. For this to happen, we must deal with a long line of factors along the production chain. Changes are being made, including the target price of milk. We'll make changes so we won't through out the bucket with the milk. Prices for raw milk will be slashed for dairies. Farmers will have to do their bit."
Simhon promised, "We will create competition in the dairy market so that we can produce more milk to bargain with the dairies. We'll open the market to imports of powdered milk and hard cheeses. We'll create competition on a scale so that they will achieve 10% of the industry's total volume within three years."
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