How long can the pet food and pet care market bull run last?

Galloping inflation. Supply chain disruptions. Labor shortages and disruptions. A pandemic that just won’t end, now becoming endemic. A major war in Europe for the first time in 80 years.

The world is dealing with a lot right now, and no person, region or industry, including pet food, can completely escape all the problems. But maybe we can at least pause for a few minutes to celebrate how well the U.S. pet food and care markets are doing despite all the events of the past two years?

Final Sales Data for 2021 Reveals US Pet Care Industry Reaches New Milestone, $123 Billion; pet food alone reached $51 billion, also a new milestone, according to the American Pet Products Association (APPA) and Packed facts. (Note that the APPA figure for pet food is just under US$50 billion.)

The industries have far exceeded even the most optimistic projections – and what’s more, the projections for 2022 and 2023 remain very positive. Still, it’s not like any of the headwinds facing the industry, pet owners, and everyone else are dying out. Can these good performances continue?

First, the good news

“After a banner year in 2020, when the industry surpassed $100 billion in sales for the first time, APPA was optimistic that strong sales would continue in 2021, estimating that growth would approach 6% and would bring total sales to $109.6 billion by the end of the year,” read an APPA press release. “The actual numbers even eclipsed the bullish estimates with growth of 13, 5% year over year.”

For pet food, by far the largest segment of the overall pet industry, sales increased nearly 15%, according to Packaged Facts. (APPA pegged segment growth at around 13.6%, likely the reason why its total sales were a bit lower.)

David Sprinkle, director of pet market research at Packaged Facts, predicts equally robust increases for 2022 and 2023 of 14% and 10%, respectively. This would bring U.S. pet food sales to $58 billion by the end of 2022 and $63 billion by the end of 2023. For All Care for pets, its projections are $137 billion for 2022 (13% more than in 2021) and $151 billion. for 2023 (+10%).

(To note: Sprinkle will present this data, along with insights and growth drivers, to Pet Food Forum 2022 May 3.)

Not all blue skies ahead

I would be remiss to share all of this positive data and optimistic outlook without acknowledging that none of the problems in my first sentence above will go away anytime soon. Because of many of these issues, pet food manufacturers and distributors are facing rising costs and are beginning to have to pass them on to consumers. And, despite many pet owners’ total devotion to their furry family members and their willingness to pay almost anything to keep them healthy and happy, there may be a limit.

While APPA’s most recent COVID-19 Pulse Study, conducted in February 2022, found that American pet owners’ fears about their finances have faded, some still linger, my colleague reported. , Tim Wall. “Even among young pet owners, money worries influenced pet food purchase decisions less than they did at the start of the pandemic or the omicron surge,” he said. he writes. “However, economic concerns still loomed over about half of survey respondents.”

These respondents may belong to the most vulnerable demographic groups. Sprinkle said new data from Packaged Facts and MRI Simmons shows that most of the increase in pet adoptions during the pandemic — and the accompanying increase in pet food and spending company – came from higher income households who own their own home, are less likely to have children at home, generally have higher levels of education and similar traits. Conversely, among households with lower incomes and lower education levels who are more likely to rent and have children at home, pet ownership and spending actually declined.

However, Packaged Facts has other reasons for its bullish projections, including the continued rise of e-commerce and how this has contributed to the continued convergence between the overall consumer market, particularly the human food category, and pet food. “The internet is bringing the entire consumer market closer to the pet food market,” Sprinkle said, referring to the “increasingly collapsing human market in the pet food market” news manners, which young pet owners seem to particularly appreciate.

Will these trends be enough to offset any negative signs? This is a situation that certainly deserves to be monitored.

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Marie R. McCraw