The beloved Krembo, a chocolate-covered marshmallow treat, is back on shelves as winter arrives. However, this year, it comes with a higher price tag that has many consumers feeling frustrated.
Recently, the manufacturer raised the price of Krembo by 9%, bringing a pack of eight to NIS 22 ($7). Just five years ago, the same pack cost around NIS 14 ($4.40). Surprisingly, this increase happens despite falling costs for key ingredients like sugar and cocoa.
Krembo is not an isolated case. The price of many food items in Israel has skyrocketed, largely due to ongoing issues stemming from the conflict that began with the Hamas attack on October 7, 2023. This has made the already high cost of living even worse.
Food companies like the Strauss Group point to rising production costs—electricity, taxes, and wages—as reasons for price hikes. Critics, however, argue that consumer protections are too weak, allowing companies to raise prices without accountability. Dror Strum, an expert in economic planning, believes that a lack of competition among food producers has left consumers vulnerable. “Retail chains keep raising prices because they know consumers have few options,” he stated.
As consumers stockpiled non-perishable goods during the war, manufacturers took advantage by hiking prices. Strum noted that many families, worried about basic food supplies, did not focus on small price increases—an exploitation of consumer anxiety.
Over the past three years, the price of a basic shopping basket has risen by about 20%. A study showed that a family of four needed to spend NIS 14,139 ($4,480) per month to meet essential needs. Alarmingly, about 27% of families faced food insecurity in 2025, up from 21% the previous year.
The situation is compounded by Israel’s largest food companies, including Tnuva, Strauss, and Osem-Nestlé, leading the charge in price hikes, sometimes by over 10%. Research by Lobby 99 revealed that since October 2023, food suppliers increased their prices by an average of 10.1%.
Yet, despite a stronger shekel and declining prices for global raw materials like sugar and cocoa, local prices continue to climb. The Israeli State Comptroller has called for better government action to manage living costs, especially during the ongoing conflict.
Historically, Israel has seen public outcry against price increases. In 2011, a proposed rise in the price of cottage cheese led to mass protests. Today, calls for reform echo once more. Experts suggest that actual reforms must break down monopolies and ease competition in the food market.
Comparing Israel’s living costs globally, the country ranks as one of the most expensive, with food prices around 51% higher than in EU nations. This stark reality is leading many Israelis to reconsider their future in the country. A recent poll indicated that one in four are thinking about moving abroad due to financial pressures.
Experts, including Strum, argue that only by addressing monopolies and promoting competition can Israel significantly lower living costs. A model for this transformation can be seen in the successful deregulation of the telecommunications sector in the early 2010s, which led to lower prices for services.
As the public looks for real change, government leaders are promising to tackle these pressing concerns. Proposed reforms aim to open markets and encourage fair competition. However, skepticism remains. Many believe that without fundamentally changing the market structure, price reductions will merely serve to enrich local importers rather than benefit consumers.
In summary, the Krembo price hike is emblematic of a broader crisis in Israel’s food sector. Until meaningful reforms take place, consumers are likely to bear the brunt of rising costs, while experts continue to call for competitive market structures that can better serve the public.
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