A government revision of dairy products has led Tnuva Foods to cut prices, including some items not under price control, by up to 10 percent.
Tnuva sells to supermarkets, which will be under close scrutiny to pass on the savings to consumers.
It sliced 6.8% off the price of white cheese and 6% of the price of milk.
Sour cream will cost 10% less, and the price of cottage cheese, the symbol of the social protest movement in Israel, will fall by 4%.
However, Tnuva is not lowering the price of yogurts, puddings chocolate milk, all of which Globes business newspaper says are high-profit items.