Sanctions against Russia in response to its ongoing attacks against Ukraine have led to the accumulation of surpluses of Israeli produce that could cost Israeli farmers tens of millions of shekels.
The suspension of Russian imports represents a substantial threat to certain sectors of Israeli agriculture, such as carrot farmers. Russia is the primary destination for Israeli carrot exports, and half of all imported carrots in Russia come from Israel. Israeli exports to Russia were halted in recent weeks, also freezing payments on products that had already been sold.
“We’re stuck with 300 dunams (74 acres) of land whose produce we won’t be able to sell,” said Ronen Albaz, a farmer who grows carrots and potatoes on Moshav Mishmeret in Israel’s Sharon region. “For us, the losses will come out to 1.5 million shekels ($470,000), but some farmers will lose tens of millions.”
Tons of produce intended for export are stuck in storage facilities throughout Israel, even after the majority of the crops went unpicked due to lack of demand. Tens of thousands of tons of celery, carrots, potatoes, and radishes that were to be exported to Russia are left without demand.
The perishable vegetables are on the verge of being destroyed, and farmers could see 30-40 million shekels ($9-13 million) worth of losses. Root vegetables are grown mainly in the western Negev (which handles approximately two thirds of production), the Sharon region, the Upper Galilee, and the southern Arava desert.
“So far there aren’t any alternatives for where to send the carrots,” said Albaz. “We didn’t pick most of the plots that were intended for export to Russia. All of the work that went into growing them will go to waste. We’ll just have to destroy the produce because it’s ripened and can’t wait any longer. I know that the Vegetable Council is trying to organize a transfer of produce to food rescue organizations, but that’s also time-limited, because you can’t refrigerate the produce for a long time, and refrigeration isn’t cheap.”
According to Albaz, the problem of exports to Russia is relatively insignificant compared to the agricultural reforms being pushed forward by Finance Minister Avigdor Lieberman.
"The war will end and exports will recover," he said. "But what they’re doing with the reform will cause long-term damage.”
Albaz claims that the government’s plan to open the market of field crops (such as wheat) to importation will not lower prices as much as other potential steps that the government is not pursuing, such as lowering water use fees or labor taxes.
“That’s where most of the cost comes from and it doesn’t even go to the farmers, it goes to the government,” said Albaz. “If they lowered taxes on farmers then we would be able to compete with Europe on equal footing even without getting as much rain as they do, and the consumer would continue to receive fresh, high-quality products. The most important thing is that we have food products available to us, and that we become less dependent on others.”
“We turned to the Ministry of Agriculture, but they’re only concerned with the reform”
According to Meir Yifrach, secretary of the Israeli Vegetable Growers’ Organization, huge amounts of surplus vegetables have amassed: 10,000 tons of carrots, 5,000 tons of potatoes, 5,000 tons of radishes, and 7,000-8,000 tons of celery that were meant to be sold to Russia.
“Trade is on hold, but there aren’t really other destinations that we can market the produce to," said Yifrach.
The major dilemma currently facing farmers is what to do with the surplus produce. According to Yifrach, the best option is for the government to take part in the cost of donating the produce to food rescue organizations in Israel, or to organizations in Ukraine and surrounding countries currently experiencing food shortages.
There are farmers who are willing to pick the produce intended for donation themselves so that they would only be asking the government to bear the costs of packing, loading, transporting, and refrigerating the vegetables.
“We’re trying to bring in the government because we understand that we have to get rid of 30-40 million shekels worth of products,” said Yifrach. “There’s a lot of talk about food security. Here’s an opportunity to provide food security to Israelis without stable access to sufficient nutrition.”
The Vegetable Growers’ Organization got in touch with food rescue organizations throughout Israel, but due to the large quantities of surplus produce, it seems that farmers will have no choice but to destroy a large portion of their yield. The organization suggested that Agriculture Minister Oded Forer could also send surplus vegetables to regions suffering from food shortages due to the war in Europe.
There is an additional possibility that the government could offer farmers assistance in bearing the costs of destroying the produce. In Yifrach’s opinion, the government has an opportunity to use the direct support to farmers, which has been mentioned often as an element of the agricultural reform, to prop up the farms that have been affected.
“We’ll plant new crops and, God willing, we’ll see what happens,” said Yifrach. “The government has a chance to come out of this positively from every perspective.”
Yifrach pointed to the additional difficulty of product insurance, saying that “there is no insurance against indirect damages caused by a war happening somewhere else. We’ve sent letters to the [Agriculture] Minister, we’ve talked to the director [of the Ministry], but it doesn’t seem to interest them. They’re only interested in the reform. Apparently they don’t really care if the reform helps Israeli agriculture.”
The Ministry of Agriculture responded: “The Ministry recognizes the economic importance of exports and is working to advance exportation in order to continue supporting Israeli agriculture. The incident in question is an event that the State of Israel and the entire world are dealing with for the first time.
“The Ministry of Agriculture has received the farmers’ input, and even beforehand held a series of conversations with farmers, heads of regional councils, and representatives of agricultural organizations in order to find a solution, and has worked with representatives of the Finance Ministry in order to meet the needs of exporters.”
This article was translated from Hebrew by Sam Edelman.