What's Happening?
Israeli dairy farmers have staged a protest in Jerusalem against proposed reforms to the dairy sector by Finance Minister Bezalel Smotrich. The demonstration, which included blocking roads and pouring milk on streets, was a response to reforms aimed at reducing
milk and cheese prices by breaking up market monopolies. The reform proposes opening the market to cheaper imports by abolishing protective tariffs, raising concerns about the impact on local dairy farms. Despite the protest, farmers resumed milk supply to dairies after a temporary halt. The reform is part of Israel's 2026 state budget, which must be passed by the end of March to avoid automatic dissolution of the Knesset.
Why It's Important?
The proposed dairy reform has significant implications for Israel's agricultural sector and consumer market. By opening the market to imports, the reform aims to lower consumer prices but risks undermining local dairy producers. The protest highlights the tension between economic liberalization and the protection of domestic industries. The outcome of this reform could set a precedent for future agricultural policies in Israel, affecting the livelihoods of farmers and the structure of the dairy market. The government's handling of this issue will be closely watched by stakeholders concerned about the balance between market competition and local industry support.
What's Next?
The dairy reform will be deliberated as part of the 2026 state budget, with a narrow window for passage before the Knesset's deadline. The reform's inclusion in the budget bill prevents it from being advanced separately, complicating its legislative process. The Knesset's Public Projects Committee will review the reform, with potential for further debate and amendments. The outcome will depend on political negotiations and the ability of stakeholders to influence the legislative process. The reform's progress will be a key indicator of the government's commitment to economic reform and its impact on domestic industries.
