{"id":2164,"date":"2025-02-19T12:20:43","date_gmt":"2025-02-19T12:20:43","guid":{"rendered":"https:\/\/foodwastereport.leket.org\/food-waste-rescue-in-institutional-consumption\/"},"modified":"2025-12-01T08:34:59","modified_gmt":"2025-12-01T08:34:59","slug":"food-waste-and-rescue-in-the-institutional-consumption-sector","status":"publish","type":"page","link":"https:\/\/foodwastereport.leket.org\/en\/food-waste-and-rescue-in-the-institutional-consumption-sector\/","title":{"rendered":"Food Waste and Rescue Along the Value Chain \u2013 Challenges, Potential, and National Benefit"},"content":{"rendered":"\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t\t\t\t
<\/div>\n\t\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t

6.7 billion NIS \n<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

Total value of food waste in the retail and distribution sector<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

\n\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

455,000 tons \u2013 Total volume of food waste in this sector<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

\n\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

The final three stages of the food value chain\u2014retail and distribution, institutional consumption, and household consumption\u2014are the primary sources of food loss and waste in Israel\u2019s food system. Positioned closest to the end consumer, these stages reflect the full cost of production, transport, and logistics. Consequently, food wasted at this point not only represents significant economic waste but also has far-reaching social and environmental impacts.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

\n\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

Food Waste and Rescue: Retail and Distribution Sector<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\"\"\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

In terms of value loss, the retail and distribution sector is one of the most significant in the food value chain. By the time food reaches this point, it has already undergone cultivation, processing, packaging, and transportation\u2014making it ready for sale and consumption.<\/p>

In 2024, the supply of agricultural produce marketed in Israel declined, partly due to the Swords of Iron War, which led to a temporary reduction in local production. Alongside the drop in supply, food prices rose sharply, resulting in an overall increase in the monetary value of food waste in the retail sector.<\/p>

Total food waste in this sector reached approximately 455,000 tons, with an estimated value of NIS 6.7b. ($1.81b)<\/strong> Of this, about 360,000 tons, worth NIS 5.4b,[1]<\/a> ($1.46<\/strong>b)<\/strong> were rescuable. In addition, the environmental cost of food waste at the retail and distribution stage is estimated at NIS 920m,[2]<\/a> ($249m)<\/strong> with a public health cost of approximately NIS 1.3b ($350m)<\/strong>.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

\n\t\t\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t
\n\t\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t
\n\t\t\t\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

[1]<\/a> The estimate of rescuable food in this stage is based on BDO\u2019s retail sector model, which incorporates CBS data as well as information provided by major retail chains.<\/p>

[2]<\/a> This environmental cost is not reflected in the market price of the lost food, which does not include the cost of natural resources lost due to food waste in this sector.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

\n\t\t\t\t
\n\t\t\t\t\t\t\t
\n\t\t\t\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t
\n\t\t\t
<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\"\"\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

Key drivers of food waste in the retail and distribution sector:<\/strong><\/p>

  1. Shelf life<\/strong> \u2013 Food that is not sold before its expiration date is deemed unsuitable for sale or donation and is removed from circulation. Contributing factors include inaccurate inventory planning, return policies to importers, and the lack of incentive mechanisms for surplus redistribution\u2014all of which lead to the disposal of large amounts of edible food.<\/li>
  2. Aesthetic imperfections<\/strong> \u2013 Products with damaged packaging, dents, or altered appearance are often rejected for sale, despite being completely safe and suitable for consumption.<\/li>
  3. Logistical damage<\/strong> \u2013 Items such as dropped fruit, broken eggs, and butcher shop remnants result in unavoidable waste, however their overall volume is relatively low.<\/li><\/ol>

    Market Failure: Structural Food Surpluses<\/strong><\/p>

    Despite significant investments by retailers in inventory management, refrigeration systems, and forecasting tools, structural food surpluses persist in this sector. Retailers prefer to maintain a full range and high availability of products to avoid empty shelves, which could lead to customer loss. This creates a commercial incentive to prioritize surplus over shortage, even when it results in systematic food waste.<\/p>

    In addition, return agreements with suppliers, where unsold goods are returned to the producer at no cost, effectively remove the retailer\u2019s responsibility to reduce actual waste. This creates a market failure<\/strong>, as there is no economic incentive to rescue surplus food.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

    \n\t\t\t\t
    \n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\"\"\t\t\t\t\t\t\t\t<\/a>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
    \n\t\t\t\t
    \n\t\t\t\t\t\t\t\t\t

    Waste rates are highest in fresh and highly perishable categories such as fruit, vegetables, bread, and fish, while more durable items like frozen foods and legumes show significantly lower levels of waste.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

    \n\t\t\t\t
    \n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\"\"\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
    \n\t\t\t\t
    \n\t\t\t\t\t\t\t\t\t

    When compared internationally, food waste rates in Israel\u2019s retail and distribution sector are similar to those in developed countries, despite the country\u2019s hot and humid climate, which increases the risk of spoilage. This suggests that inventory and waste management practices in the sector are maintained at relatively high standards. In contrast, developing countries typically experience significantly higher waste rates, primarily due to insufficient infrastructure for distribution, storage, and marketing.<\/p>

    In recent years, food retailers have invested heavily in advanced logistics centers, digital inventory management and demand planning systems, and the maintenance of cold chains during distribution. These developments have significantly contributed to reducing food waste in the retail and distribution sector.<\/p>

    Concurrently, since the COVID-19 pandemic, consumer purchasing patterns have increasingly shifted toward supermarket chains and online platforms\u2014channels typically associated with lower rates of food waste. As a result, this sector has seen a modest decline in food waste over the past year.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

    \n\t\t\t\t
    \n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\"\"\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
    \n\t\t\t\t
    \n\t\t\t\t\t\t\t\t\t

    The ongoing shift in consumer behavior toward low-cost, efficient retail chains, and particularly online shopping platforms, has led to a slow but steady decline in food waste rates. According to the 2024 UN Conference on Trade and Development (UNCTAD) report,[1]<\/a> consolidating deliveries and reducing individual travel to retailers can cut transit-related greenhouse gas emissions in the retail sector by up to 87%, providing an additional environmental incentive to favor retailers with optimized shelf management.<\/p>

    Food Rescue Potential in the Retail and Distribution Sector<\/strong><\/p>

    Approximately 360,000 tons of food waste at this stage are rescuable<\/strong>\u2014primarily fruit and vegetables (225,000 tons). Food rescue at this stage alone could offset nearly 50% of the national food gap experienced by those living with food insecurity.<\/p>

    Rescuing this volume of food could also save the Israeli economy an estimated NIS 2.9b ($780m)<\/strong> annually in excess healthcare costs<\/strong> (see Chapter 5).<\/p>

    Actions to Reduce Food Waste and Promote Food Rescue<\/strong><\/p>

    In addition to the structural causes of food waste, the retail and distribution sector also sees ongoing efforts to reduce waste and rescue edible food.<\/p>

    Retailers and producers have adopted a range of waste-reduction practices, some driven by economic incentives, others by social responsibility commitments. These include:<\/p>