Israel scrambles for solutions as Ukraine war chokes off egg, wheat imports

Just two years ago, a pandemic-induced egg shortage hit Israel just as the egg-rich holiday of Passover was approaching.

In 2020, as the holiday approached, many in the country embarked on a real-life egg hunt, trading rumors of stores with fresh supplies or gray market egg dealers, and awaited promised planeloads of the fragile food item to arrive.

In one telling scene, El Al shared videos and pictures of its planes being filled to the brim with cartons, even using passenger seats to buckle in the fragile cargo.

Now the government is again scrambling to head off predictions of another shortage of eggs, as well as wheat and other grains, just as the holiday arrives, this time thanks to the war in Ukraine.

Israelis eat an average of 240 eggs a year, or 20 per month, slightly higher than average for the world. On Passover, though, with many other foods prohibited by religious and state fiat, egg consumption goes up by 10% to 22 eggs per person.

Between the Seder and a plethora of recipes that use eggs as a leavening agent, not to mention the eggy favorite matzah brie, it’s not uncommon for families to go through multiple dozens of the incredible edible protein over the holiday.

That is if they can find them.

Ukraine normally makes up about 30 percent of the 100 million eggs imported to Israel annually. The Agriculture Ministry, which has vowed to head off a shortage, is looking into additional imports from Poland and Bulgaria to make up for any shortfall.

Even before Russia invaded Ukraine on February 24, it had been a tough year for egg importers, said Yehuda Ohana of Har Meron Eggs, an egg sorting station in the north that supplies some four million eggs each month to supermarkets.

“We already felt the strain with the avian flu in November,” said Ohana. An outbreak in northern Israel affected some 20 coops with about a million hens.

At the time, he began working with egg traders from Ukraine.

“The prices were pretty cheap, comparatively, and they’re pretty good eggs,” said Ohana, whose sorting station is inside Kfar Hoshen, also known as Safsufa, a moshav in northern Israel.

Then Russia invaded and “the imports stopped completely,” he said. “I’ve been trying to bridge the gap since then, and there’s not a lot I can do.”

Other egg importers have turned to Spain and Italy, said Ohana, but the prices are far higher. For now, he’s supplying fewer eggs to his customers.

“The importers will start feeling those higher prices very soon,” he said.

While it may make sense to encourage new egg farmers in Israel, which the Agriculture Ministry is now attempting to do in order to create more food security in Israel, it’s not a simple solution, said Ohana.

“If the government would have planned this a little better, there would’ve been enough eggs in Israel without having to import any,” he said, adding that the costs of growing eggs “are enormous,” given the prices of feed as well as electricity and water.

It’s not just eggs, either.

Israel’s flour mills, which have long imported grain from Russia and Ukraine, are also reeling from the abrupt end of imports from war-torn Ukraine.

“It’s all over, it’s done,” said Shalom Hatuka of Shintraco, an Israeli grain importer that purchases grains for human and animal consumption, some 600,000 tons each year. “We’re finished getting grain from Ukraine, it’s a destroyed country, its ports and lands were so deeply ruined. The Mariupol port isn’t relevant any longer, they destroyed all the port infrastructure.”

Ukraine was the world’s sixth-largest exporter of wheat in 2021 with a 10% share of the market, shipping 20 million tons of wheat and meslin (a mixture of wheat and rye), according to the United Nations, and the country is also one of the world’s top exporters of barley and sunflower seeds.

Israel’s grain traders have been buying from Russia and Ukraine for the last 40 years, and they stocked up for February and March, when war seemed inevitable, said Hatuka.

But other alternative sources weren’t obvious either, said Hatuka, as Hungary and Moldova were holding on to their own supplies, and prices are much higher for grain from the US and Canada.

For now, Romania is helping make up for some of the shortfall, but prices there are up 150%, to some $150 per ton, on average.

“We’ll start feeling it in April,” said Hatuka.

Finance Minister Avigdor Lieberman predicted the flour fallout back in late February when Russia first invaded Ukraine, noting that wheat imports would inevitably be affected, creating a rise in prices.

He predicted any measures the government took to head off the crunch would fall short, comparing it to trying to stop a tsunami with an umbrella.

Israel imports 60% to 70% of its wheat from Russia and Ukraine, much of the rest from Hungary and Romania, and a small percentage from the US and Canada, said Kobi Polturak, CEO of Israeli Flour Mills, which provides some 15% of Israel’s ground flour.

“We’ve succeeded for now in bringing in some extra flour from Canada and Estonia, but it’s not so simple,” said Polturak, who works with brokers to source the flour mill’s wheat. “Everyone’s working a little harder to find wheat right now. It’s an effort.”

Polturak said he didn’t think there would be a shortage, but prices are rising. If one ton cost $380 prior to the Russian invasion of Ukraine, now it’s more like $550 or $600 per ton.

Other residual effects of the wheat shortage will be felt in the price of cooking oils, said Shintraco’s Hatuka, as Ukraine is one of the world’s largest producers of sunflower oil.

Israeli flour mills import grains ahead of time in order to fully process it and allow for the kosher certification process, said Polturak. But he’s already purchasing grain at higher prices, mostly from Canada where the quality is the same as it was from Ukraine.

“Canada is as good as Russia or Ukraine, maybe even better,” he said. “It’s just much more expensive.”

He estimated that he has enough flour to last through June, and that’s after months of difficulties with sourcing grain, starting with the pandemic that created an increase in shipping and energy prices.

“What will be afterwards, I don’t know,” he said. “I hope I’ll be able to get the grain I need.”

The Times of Israel

Tags: Ukraine, импорт, grain, prices, Grains, wheat, Israel, меслин, shortage, egg