Despite the Industry, Trade and Labor Ministry's signed order to drop the price of regulated bread by some 4% due to a reduction in global wheat prices, the price of matzot, which are also made out of wheat, will not be dropping this Passover.
Only one mill in the country produces the special wheat used to make matzot. Since this mill, which is located in Jaffa, has been declared a monopoly, its prices are regulated by the Industry, Trade and Labor Ministry.
"This year the Industry, Trade and Labor Ministry reached an agreement with the mill on the small reduction of only 3% in wheat prices, which does not allow us, the manufacturers, to drop the prices for the consumers," said David Wolf, CEO of Matzot Aviv.
According to Wolf, the price of matzot this year will be identical to last year's at some NIS 15 (about $3.5) per kilogram.
The matzah product most in demand in the is the 2.5 kilogram family pack, which makes up for over 50% of matzot sales. This year, such a pack will be priced at NIS 35 ($8.4) - unchanged from 2008.
The ministry's supervisor of prices, Zvia Dori, said the wheat issue was under meticulous inspection, and that each year an accountant is sent to the mills to price the costs. "The mill buys the wheat as early as August, and the price then was higher than the price today," she said.
Wolf said he expects a drop in the demand for special matzot, such as flavored matzot, egg matzot or "health" matzot, due to the recession.
Instead of specialty matzot, Wolf expects a rise in demand for the regular ones. The matzah market in Israel is estimated at NIS 120 million ($28.7 million) per year.
"Despite efforts to try to reduce the price of matzot this year, since they are considered a basic and vital product, the price will remain identical to that of Passover 2008," said Eli Gidor, the Shufersal supermarket chain's commerce and marketing VP.
However, each year maztot are included in several different supermarket chain sales ahead of the holiday, so it is likely that this year packages at lower prices will be also available.