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China’s thriving pet food market brings future opportunities

October 1, 2021
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Why this is important to Wisconsin businesses: With China’s increasing demand for pet food, consumers could welcome products from Wisconsin’s high-quality pet food companies.

More people in China are adding pets to their households, giving a big boost to the market for pet-related products, especially premium-quality pet foods.

The number of pet dogs and cats in China’s cities topped 100 million in 2020, up 1.7% from the previous year. Millennials and Generation Z consumers are driving the increase, reflecting the higher living standards of the growing middle class as well as the increasing number of single people and empty nesters.

About half of the pet food buyers in China are new pet owners, a report by the Bain & Co. consulting firm said. More than 60% of those surveyed said they consider their pets to be family members, and 85% said they are willing to buy high-quality pet food with higher prices, especially those with fresh ingredients, high protein and meat content, natural processing and no additives.

In 2020, sales of pet products and services reached ¥206.5 billion ($32.5 billion USD), according to the Bain report. That represents a compound annual growth rate of 35% since 2010.

Pet food sales accounted for ¥111.2 billion ($17.5 billion USD), or 55% of the sales, making China the second-largest pet food market, behind only the U.S., even though only 23% of Chinese households have pets, while 60% of Americans are pet owners. U.S.-based Mars manufactures the most popular pet food brands sold in China, and Mars plans to build Asia’s largest modern pet food plant in northern China, in a projected $100 million USD investment.

As a result, the total scale of China’s pet food market may reach ¥150 billion ($23.6 billion USD) by 2025, with as many as 35% of Chinese households owning pets, the Bain report predicted. It said China is “one of the most attractive pet food markets in the world,” and consumption will continue to grow,” providing significant opportunities for companies in the pet supplies market.

 

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