I'm not an economist or an industrialist or an importer, so I don't know the exact cause of the problem, but what I can tell you is that the COVID-19 whirlwind wreaked havoc in Israeli tallit production, which was already struggling to keep up with demand before coronavirus hit.
Back in the good ol' days, when we placed wholesale orders from the two major tallit manufacturers here in Israel, Mishkan Hatchelet and Talitania, we could expect to receive at least 80% of the items we ordered. Today, we receive under 50%.
So after we place an order, we then make a second "shopping list" of the items that were unavailable and send it to a another supplier. They'll provide about half the items on the pared down list, and then we go to a third supplier. After all that, we still have a few items that we're unable to procure.
Our customers don't have to suffer through this, because in almost all cases only tallits we have in stock can be ordered on our web store, so it's very rare that they'll get notified that what they ordered is out of stock.
About once every other year we get notices from our various suppliers that the wholesale prices are going up because of increased production costs (price of wool, shipping, etc.). The same applies for shipping.
For the sake of transparency, here's the latest news on tallit prices: Surprisingly, neither of the main tallit makers raised their prices at the start of the year. Ptil Tekhelet prices went up slightly; so far, we haven't raised our retail price for Ptil Tekhelet. The price of all-white tzitzit strings has been rising incrementally in recent months; again, we haven't raised our prices. Gabrieli prices went up a bit.
DHL raised it's rates around 8%, but the rate list for Israel Post remained almost entirely the same for 2023. So we might have to raise our Express shipping rate soon, but probably not our First Class shipping.