ORGANIC PET FOOD: THE NEXT ‘BIG THING’?

Owners now consider their pets as parts of their family, claims a 2016 Nielsen Report, titled ‘The Humanization of Pet Food’. Pet Humanization has meant that the owners are...

Owners now consider their pets as parts of their family, claims a 2016 Nielsen Report, titled ‘The Humanization of Pet Food’. Pet Humanization has meant that the owners are now looking for premium and nutrient-rich food options for their pets. A survey conducted by the American Veterinary Medical Association found that, in the recent years, expenditure towards pet’s health and other veterinary care has seen a 40% raise. A part of this rise reflects on the pet food market; the increased demand for pet health insurance also supports this argument. Pet owner’s concern is no longer just limited to pet care and nutrition; they now want to also splurge on their pets. For example, Mars Inc. has come up with the Cesar Home Delights® product line, which sells fancy gourmet food, like beef stroganoff for dogs, with the belief that owners now feel guilty to offer the same food every day to their pets. A recent US survey concludes that four among five pet owners believe that their pets are having, and should have, healthier food than them. They demand pet food free of sugars, grains, dyes and preservatives, which will enable an organic pet care. Currently, the sale of premium pet food also exceeds sale of economy- or mid-priced products. What will be the larger implications of these trends for the pet food market, globally?

Increase in pet ownership is fueled by economic growth in the developed and developing countries, since owning, nurturing and caring for a pet is seen as a mark of social status and sensitivity. The global pet food market generated a revenue of USD 74.9 billion in 2016. North America has the largest share (35%) of the market, followed by Europe and Asia-Pacific. The latter has close to 20% of the market share. One can expect the latter to display the same trend in the near future.

However, while the revenue is experiencing growth, the profitability is going down due to increasing input costs. Moreover, the collaborative report by the Clean Label Project and the Ellipse Analytics, which tested over 900 pet food products being sold in the United States market for 130 contaminates and toxins, found that the majority of the products contained more than acceptable levels of elements like lead, arsenic, mercury and cadmium. The presence of pollutants in pet food has become a major deterrent for the consumers. These pressure factors indicate that the pet food market is expected to find the answer to these crises in the premium and organic segment of the market in the near future.

Additionally, pet humanization has meant that owners are increasingly feeding their pet snacks and treats not just as food, but as rewards, signs of affection, etc. Such non-purposeful eating is leading to obesity, allergies and other autoimmune disorders among the pets. Growing recognition of these problems of pet nutrition and care has produced an urgent demand for nutritional, health-inducing and organic pet food products. The demand has, in turn, made big players, like Bob Martin and Balchem, to launch a series of such products into the market.

Globally, a large number of NGOs are enthusiastically running programs for adopting strays. Their stress of ethical pet adoption and pet care is also expected to positively impact the demand for organic and premium pet food products that cater to the nutritional demands of a more conscious generation of pet owners.

In short, we expect to see the considerable growth of the market for the organic human food products to bleed onto the pet food market. However, some factors, like President’s Trump’s move against United States trade relationships, the stricter control on labeling convention by Association of American Feed Control Officials (AAFCO), etc. might have some mitigating impact on this positive global market trend.

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