2020 has been a roller coaster for every industry, business and person globally. The pet food industry will survive the uncertainty, but in what shape? Perhaps we can look to 2019 as a baseline and possible foretelling of future growth.
Entering this year, the global pet food market stood at more than US$91 billion, with US$36 billion of that in the largest market, the U.S., according from Euromonitor and Nielsen. U.S. sales grew 7.3% year-over-year (YOY) in 2019, and Packaged Facts initially projected 6% growth for 2020.
Globally, the market rose 6.5% YOY in 2019, driven by continuing double-digit gains in Asia-Pacific, Eastern Europe and Latin America, Euromonitor said, and by ongoing premiumization and humanization. Even Western Europe saw small growth. New data from FEDIAF (the European Pet Food Federation), which represents 18 countries in Western and Eastern Europe, showed that pet food sales in the region increased 2.6% annually, reaching 21 billion euros (US$23.6 billion) in 2019.
The evolving COVID-19 pandemic crisis and ongoing economic pain may cause a complete turnaround in pet food’s fortunes for 2020 and beyond. Yet, with most people still seemingly able to keep their beloved pets despite some financial hardship, the outlook is cautiously optimistic. Pets are family members that still need to eat, even if some pet owners have to trade down to lower-priced pet foods.
More positive pet food projections
Packaged Facts has revised its forecast from April 2020, which projected an overall loss of 17% for the U.S. pet care market for the year; pet food was one of the few bright spots at 4% expected growth. Now, after pet adoptions have continued to increase and sales of pet products have kept pace, Packaged Facts projects the U.S. pet care market to decline only 0.9% for 2020. Pet food – now expected to grow by 7% this year – and other pet products (9% projected growth) will help offset ongoing losses in pet services.
Even better, Packaged Facts expects the pet care market to rebound healthily in 2021, registering 7.6% growth, with pet food increasing 5.5%. Through 2024, growth is projected for at least 5% annually.
For the global market, the depth of the recession will play the largest role in how pet food and pet care fare, according to Euromonitor. The key will be the level and type of value for their hard-earned, possibly scarce, money that pet owners believe they are receiving from the pet foods they buy.
Source: Debbie Phillips-Donaldson is editor-in-chief of Petfood Industry