The Co-operative Group has thrown out a boycott motion calling for complete severance of trade with Israel.
A motion submitted by the group's South and West membership region on Saturday declared: "This annual general meeting resolves that our Society stops the sale of all Israeli goods."
But after a debate the motion was overwhelmingly rejected by 83 per cent of delegates at the Co-op's meeting in its Manchester headquarters.
Supporters of a boycott have been rallying members in recent weeks to force boycott motions through the group's seven regional memberships.
The Palestine Solidarity Campaign has been campaigning nationally for its activists to join the Co-op to change the balance of votes in favour of boycotts. Leeds and Newcastle regional groups have already passed boycott motions, while Bristol, in the South West region, also tabled a boycott call.
Motions approved at Co-op members' meetings are not binding upon its management.
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