Petfood Forum China 2016 highlighted current, future growth of Chinese pet food market

With a growth rate of at least 19% for retail sales and as significant as 100% in terms of production for some areas, the Chinese pet food market is booming at a seriously impressive rate. The factors behind China’s significant growth were highlighted by leading subject-matter experts during Petfood Forum China 2016. This fifth annual event was held in Shanghai, China on 17 August in conjunction with Pet Fair Asia 2016.

To kick-off this exclusive event, attendees were treated to an overview of a survey on the Chinese pet food market, presented by Wang Jinquan, PhD, associate professor with the Feed Research Institute of the Chinese Academy of Agricultural Sciences. Significant data points of this survey, which was funded by the government’s Ministry of Agriculture, included volume production of 700,000 tons in 2015, representing production value of 7.5 billion CNY (US$1.1 billion) and overall sales of 23 billion CNY (nearly US$3.5 billion).  According to Wang, pet food production has grown approximately 40% overall, with 100% growth in certain areas.

With over 10 companies already built or currently being constructed, it is no wonder that capital investments are another contributing factor to China’s rapid growth. One of these ten additions is Perfect Companion’s new factory in Zhejiang province, which produces an annual output of 120,000 tons a year. It seems that China has a lot more growth in its future, as Wang projected that more capital would pour into the market over the next five to 10 years as competition intensifies.

In addition to his data on growth factors for the industry, Wang also provided a progress report on new pet food regulations and standards being developed, which was funded by the Ministry of Agriculture, as well. Of the several types of regulations under way, the one most currently complete covers registration for imported pet food products, a process that the new regulations aim to accelerate.

Another perspective on the growth that the Chinese pet food market is experiencing was provided by Pushan Tagore, vice president of global marketing-pet care for GfK. Tagore primarily shared data on retail pet food sales in China, specifically in pet shops, hypermarkets and veterinary clinics, plus online. According to Tagore, GfK tracking data shows sales from those channels will reach approximately US$1.77 billion by the end of this year, representing approximately 19% year-over-year growth. The average price per kilogram of pet food and treats also continues to rise, as it is now hitting about 45 CNY ($6.77) in April 2016, a 12.5% increase since 2013. This first stage of premiumization is further fueling the market’s growth.

Other experts that presented at Petfood Forum China 2016 included Emma Bermingham, PhD, senior scientist for AgResearch Ltd., with research on whether dietary formats affect the nutrition and health of pets (with an emphasis on popular BARF, or biologically appropriate raw foods); Juan Gomez-Basauri, PhD, global director of the companion animal business of Alltech, discussing the role of mineral nutrition in pets, and whether mineral supplementation as currently sourced is sustainable; and Franck Peron, DVM, PhD, ethologist for Diana Pet Food, sharing best practices for measuring pet food palatability.

Rounding out the roster were Shiguang Yu, PhD, global technical manager-pet nutrition for DSM Nutritional Products, explaining why microalgae offer a sustainable source of polyunsaturated fatty acids for pet food; Will Henry, director of technology and R&D for Extru-Tech Inc., sharing results of case studies on the development of exotic pet diets and novelty treats using a single-screw extruder; John Adams, president of Adams Development, on creativity and culture’s role in developing business strategy, with differences among the US, UK and China; and Teresa Agulles, co-owner of PlusVet Animal Health, describing how plant extracts help meet pet food trends such as humanization and natural.

More than 100 pet food professionals, including conference sponsors, participated in Petfood Forum China 2016. The sixth edition of the conference will be held on August 23, 2017, in Shanghai at the Shanghai New International Expo Centre.