The Pet Food Market Landscape in China

January 20, 2022

China’s burgeoning middle class, its rising single adult population and DINK (dual income, no kids) families, as well as its aging population have all come together to drive pet adoption in China for the past decade or so. And cats and dogs dominate the landscape (97%). As of 2020, close to 63 million people in China were taking care of over 100 million pets, supporting a $32 billion service industry for just cats and dogs. And of that $32 billion, around $17.8 billion was spent on pet food alone.

Like many other industries, the pet food market in China is just as competitive. Being able to read the pulses of the market is fundamental to playing a winning game. Here are a few interesting trends:

  • Growth is increasingly driven by the humanization of pets. Cats and dogs in China each had their own traditional roles in the old days, but time has certainly flown. Research shows an increasing percentage of Chinese pet owners (57.1%) are coming to see pets as their “children”. And, as it goes with children, pet “parents” are ready to lavish their love by investing more on making their pets happier. According to a recent CBNData survey, the majority of pet owners in China are choosing to please their pets’ palate with better food. And by “better”, it means “real meat, more protein, natural ingredients, zero additives” or simply, “the right nutrition in the right format for the right species at the right time.”
  • Cats seem to be winning the “tug of love." Despite historical data of dogs being the preferred friend of humans, the time seems to have come for cats. The adoption rate of pet cats came almost on par with dogs in 2020. And in terms of adoption growth and increase in gross spending, cats were ahead of dogs by 12.3% and 18.4%, respectively. Cat owners are also spending significantly more on pet food than their dog counterparts, so it’s not hard to see cats becoming the preferred friend in the near future. 
  • E-commerce is becoming increasingly preferred and social media could lend an easy handle on the consumers. The COVID-19 pandemic has certainly helped drive more people online, but the convenience of e-commerce in China is simply hard to resist. By 2020, there were over 37,000 pet food brands online accounting for 54.7% of pet food consumption in China. Though in terms of the specific sources for pet-related information, WeChat, Douyin (the Chinese version of TikTok), and Xiaohongshu (RED) are by far the most popular options among Chinese pet owners. International players such as Real Pet Food Company have been able to leverage e-commerce to successfully launch their products in China and gain significant traction in the market at the same time. 
  • Young, educated women in top tier cities hold key purchasing power. Of the approximately 63 million Chinese pet owners, nearly 90% of them are female. Most of them (75%) were born in the 80s and 90s and are generally well educated (with a college education or a bachelor’s degree). A CBNData analysis of e-commerce big data shows that the majority (about 70%) of online pet food purchases in China in 2021 are made by female pet owners. Meanwhile, Tier 1 cities in China typically have the most pet owners followed by Tier 2 cities, but this was officially reversed in 2020 (41.8% vs. 37.8%). And Tier 2 cities are expected to continue the lead due to their relative low living costs.
Pet food is specifically designated as an eligible product for China’s cross border e-commerce channel (as of January 1, 2019) and the U.S. is currently the 2nd largest international supplier of pet food (for cat and dog food only) in China after Canada. Even though local Chinese companies have been catching up in product quality and development of new products in recent years, the market is still hungry for more innovative and premium quality niche products to make their pets even happier, particularly their cats.

However, the export of pet food to China can be a very complex process as it involves registration with China’s General Administration of Customs (GACC) and the Ministry of Agriculture and Rural Affairs (MARA). Interested Iowa companies connect with the Iowa Economic Development Authority’s global representatives in China for further guidance on the process. 
 
References:
  1. The 2020 Chinese Pet Industry White Paper by pethadoop.com.
  2. 2021 (2021 Pet Food Industry Consumption Insights Report) by CBNData.com.
  3. 2020 Analysis of cat food consumption surpassing that dog food based on the status of the 2020 China pet food industry consumption) by Qianzhan.com.
  4. https://realpetfoodco.com.au
  5. Looking for Opportunities in China’s Fast-growing Pet Industry by PwC.
  6. Report on Pet-related Consumption Disputes and Complaints
  7. https://www.fas.usda.gov/data/china-growing-opportunities-us-pet-food-china-market 
  8. https://ustr.gov/sites/default/files/files/agreements/phase%20one%20agreement/Phase_One_Agreement-Commodity_Fact_Sheet-Pet_Food.pdf 
  9. https://www.aphis.usda.gov/regulations/vs/iregs/products/downloads/ch-pet-food.pdf
  10. https://www.aphis.usda.gov/aphis/newsroom/stakeholder-info/sa_by_date/sa-2020/sa-06/china-pet-food-exports
  11. https://www.fas.usda.gov/data/china-roadmap-china-challenging-new-feed-regulatory-system
  12. http://www.moa.gov.cn/gk/zcfg/nybgz/201805/t20180504_6141413.htm
  13. https://www.ams.usda.gov/services/auditing/feed-verification/guidance 
  14. http://english.customs.gov.cn/

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