NUTRITION HEALTH & WELLNESS drive growth in the pet food industry

People have fed, domesticated, and kept dogs and cats for work and/ or pleasure for millennia. With the Industrial Revolution and the rise of the middle class in the 19th century, families with disposable income began to keep domesticated dogs and cats as companion animals – rather than just as working animals.

During this time, however, little consideration was given to feeding pets, as a pet’s diet was much like that of its owners, consisting of whatever owners could spare, such as knuckles of bone, cabbage, potatoes, onions, and crusts of bread.

As the scientific understanding of pet nutrition and food safety advanced, it became evident that animals have their own unique nutritional requirements.

A 2017 survey conducted by Nestlé Purina PetCare found that 84% of pet owners are concerned about the ingredients in their pets’ food. Additionally, the research revealed that more than four out of five pet owners are likely to read the list of ingredients in pet food before buying it.

BY MADELEINE ORINA

Pet owners now rely on pet food manufacturers to base formulations on proven nutritional science. In consequence, the pet food segment has registered a significant boom in the past few years and continues to be on an upward trajectory.

Just how big is the pet food industry in 2022? What are the main drivers behind the industry's recent growth? What key trends will shape the industry in the future? This article provides a review of the industry to give you an in-depth understanding of where the industry is currently, and the trajectory that it is expected to take in the future.

Market Segmentation

According to a report from Research and Markets, the pet food segment, which was valued at US$87,268.2 million in 2020, is projected to reach US$133,430.9 million by 2030, registering a compound annual growth rate (CAGR) of 4.6 percent from 2021 to 2030. The dog food segment accounts for the largest share of the global market, owing to the rising trend of nuclear families and the growing inclination of consumers toward dogs for companionship and security.

Based on the food type, the market is segregated into dry food, wet food, treats & snacks, and others. Dry pet foods are made by mixing dry and wet ingredients to form a dough, which is heated under pressure, then pushed through a die machine that cuts the kibbles. Dry food was the highest revenue-generating food type because it is one of the most convenient types of food, easy to store, requires no refrigeration, and is available at affordable prices as compared to other types of food.

Pet snacks may be more highly flavored as they have a special chewy texture and usually consist of baked products like biscuits, dried vegetables or fruits, and roasted grains. Treats usually consist of jerky and dental chews, among others. These products are not necessarily so well-balanced nutritionally but are aimed at providing an enjoyable experience for the animal and its owner, with 45% of pet owners reporting treats are their way of showing their pet they love them.

Based on the sales channel, the market is categorized into supermarkets & hypermarkets, specialized pet shops, online sales channels, and others. Regionally, the market is divided into North America, Europe, Asia-Pacific, and LAMEA regions. North America dominates the global market and accounted for a 49.9% share of global revenue in 2021 and is expected to continue dominating the market during the 2021-

2030 forecast period.

As with the rest of the food industry and in other fields of business, the pet food industry is very profitable for the few mighty companies that control the market, namely: Nestle Purina Pet Care, Colgate-Palmolive, Mars Incorporated, General Mills, and J.M. Smucker Company. Collectively, these companies control more than 60% of the global market share.

The Convergence Of Human And Pet Food Trends

Pets have become an integral part of the modern household, particularly in countries with rapidly expanding middle class. In fact, according to Euromonitor International's Voice of the Consumer: Lifestyle Survey, 71% of pet owners globally consider their pets as family members.

As a result, in the pet food sector, pet owners’ expectations all over the world are increasingly shifting from a demand for ‘high quality (for pets)’ pet food to ‘humanized’ pet food. This means that they want pet food options that address the same health concerns that currently influence human food production.

Gone are the days when pet food all looked the same: like either brown mush in a can or

FEEDING DOGS A DIET MADE WITH NATURAL, REAL INGREDIENTS, SUCH AS BEEF, CHICKEN, LAMB, PEAS, SPINACH, CARROTS, AND BLUEBERRIES, CAN DO WONDERS FOR THEIR OVERALL WELL-BEING dry brown kibble chunks. Pet foods today increasingly look like human foods in color, shape, and texture. For example, in 2021, German pet food producer Trixie extended its variety of treats in the form of lollipops, pretzels,

The company recently hosted a customer cookies, waffles, and doughnuts. As pet food— particularly high-end pet food—is edging ever closer to human food, the overlaps between the two categories can be uncanny.

Natural Ingredients Become The Gold Standard In Pet Food

In recent years, many pet owners have abandoned conventional, veterinary-recommended commercial diets in search of more “natural” and “homemade” choices. The natural pet food trend has focused on the inclusion of whole ingredients, including meats, fruits, and vegetables; and avoiding ingredients perceived as heavily processed, including refined grains, fiber sources, and by-products.

According to the American Kennel Club, "Feeding dogs a diet made with natural, real ingredients, such as beef, chicken, lamb, peas, spinach, carrots, and blueberries, can do wonders for their overall well-being—promoting heart health, increasing energy levels, making coats shiny and breath smell better, improving eyesight, and even impacting a dog's stool."

The concept of frozen or refrigerated raw pet food is also an emerging growth driver in the natural pet food category, as it offers a viable option for those who want fresh whole food for their pets without the hassle of preparing it themselves. In response to this trend, Petco Health and Wellness Company and fresh and frozen pet food pioneer brand JustFoodForDogs co-developed their new WholeHearted Fresh Recipes. With meals made of chicken, beef, or fish and vegetables, this new line is optimized to deliver frozen nutrition for dogs that's high in quality and minimally processed.

Pet health company Nom Nom, which was acquired by consumer products giant Mars Inc. in January, has upped the fresh pet food game. The company helps build a meal plan using highquality, human-grade ingredients for a customer based on their pet’s unique needs and with insight from an in-house practicing veterinarian and professor of veterinary medicine, after which it will prepare and portion the meal and then deliver it to their customer’s door.

Alongside human-grade meats and vegetables, fruits have emerged as a relatively new category of pet food ingredients that embodies the concept of health. A formulation that they feature is Homestyle Creations Healthy Mixers from FreshPet. The fruit Mixer contains delicious bananas as well as antioxidant-rich cranberries, and blueberries in a natural broth. Primal Pet Foods, which specializes in pet food made with organic ingredients, also includes fruit in its formulations. The company explains in a blog entry that, “Blueberries and cranberries offer a wide array of phytonutrients and are known for their anti-inflammatory properties. Both are rich in manganese essential for growth, metabolism, and the body’s antioxidant system. Additionally, blueberries and cranberries promote urinary tract health.”

As a sign that natural recipes are also being favored, “free from” claims are gaining in popularity within pet food. As noted in Euromonitor International’s Products Claims and Positioning 2021, the top four claims such as grain-free, colors, and flavors are increasingly visible on product packaging. US-based Made by Nacho cat food brand released a grain-free product line in 2022, and Nestle Purina Petcare announced it has changed the recipe for its Bakers dog food range, removing all the artificial colors and replacing them with colors that occur in nature; these are taken from either plant, animal, and mineral sources. Sales of these products have also been skyrocketing. According to NielsenIQ, products certified to be free from artificial ingredients grew 24% in sales during the past two years, to reach US$1.5 billion in total sales, while foods that are free from artificial preservatives grew 23% to US$2.9 billion.

Ingredient Suppliers Keeping Up With Consumer Interests

The drive to create healthier pet food also has been taken up by pet food ingredient suppliers. While the ingredients touted on the front labels of top-quality pet food are things like grass-fed beef or whole vegetables, most still require other ingredients to make a viable product. But those additional ingredients must meet the better-for- you requirements of the highlighted ingredients. Maypro, which provides a wide range of ingredients that make pet food healthier, has seen demand for these ingredients grow over the past four years, says Danielle Weed, director of marketing strategy and public relations. Champex is one of the ingredients that Maypro has developed in this category. It is a detoxifying and odor-reducing extract of the Agaricus bisporus mushroom that is clinically shown to decrease concentrations of several toxic compounds in the gastrointestinal tract and the blood.

Similarly, traditional preservatives with their often chemical-sounding names are also increasingly falling out of favor with pet parents, prompting manufacturers to opt for natural alternatives for maintaining the freshness of pet foods. "Manufacturers can choose proven preservative solutions that use plant-based antioxidants and organic acids like vinegar, which are naturally produced through fermentation, to slow oxidation and inhibit spoilage and pathogens," says Robert Ames, senior business development manager, meat and pet food, Corbion.

Specialty ingredient supplier Kemin Industries is leading the way in developing innovative natural antioxidant formulations for the pet food industry such as its NUTAROX line which offers natural liquid and dry antioxidants for pet food, its PARAMEGA line which stabilizes petfood diets high in Omega-3 and Omega-6 Fatty Acids and its VERDILOX line for natural pet food sustainability. Wilbur-Ellis Nutrition has also developed its own solution for the rendering industries in the form of Oxy-Gon, an advanced

IN NUMBERS

24% GROWTH IN SALES FOR PRODUCTS CERTIFIED AS FREE FROM ARTIFICIAL INGREDIENTS

Agaricus bisporus mushroom is clinically proven to decrease concentration of several toxic compounds in the git and blood antioxidant product line made from plant-derived natural extracts used for the preservation of animal fats, vegetable oils, fat-soluble vitamins, and other materials subject to oxidation.

Specific Functionality Gains Popularity

The trend toward functional pet nutrition products continues, stoked by increasing interest in products that support mental health and physical wellbeing, as well as those that target specific pet ailments. In 2021, Hill’s Pet Nutrition developed a specific kibble formula and processing method to improve pets’ dental added a new salmon small bites recipe to its GO Sensitivities line. health, while Nestlé continues to expand with its fortified croquettes that support digestive health.

In mature markets, the mental health of pets is also receiving attention, as consumers become increasingly concerned about the stress that pets undergoe when left alone, especially following home seclusion during lockdowns. For example, in 2021, UK-based Scrumbles launched Nibbles Calming Dog Treats that include ingredients for mental and gut health. Solid Gold, in 2021, introduced NutrientBoost, a new line of dog and cat food formulated with plasma specifically targeting gut health. The gastrointestinal and immune benefits of plasma can aid inflammation, improve immunity and reduce the adverse effects of stress, the company said. “Symptoms like anxiety, stress, low energy, excessive scratching, and shedding may also be signs of poor gut health – so helping your pet feel better during this transitional time might end up being as easy as switching them to a better diet,” said Leasa Moltke, manager of nutrition and regulatory affairs at Solid Gold.

As pet owners ensure their pets are eating the right nutritious foods, it is just as important to ensure they eat proper portions to avoid overfeeding and obesity. Personalized feeding regimes using portion control such as that provided by the SmartFeeder from US-based Petnet, are therefore becoming popular. Featuring customizable, automated pet food portioning, the SmartFeeder sends alerts and notifications to pet owners when their pet needs feeding, has been fed, and has finished eating. It requires WiFi access.

Probiotics and hypoallergenic ingredients, and fortified superfoods are experiencing increasing demand. General Mills-owned dog food brand Blue Buffalo is releasing a new line of functional formulas exclusively for the pet specialty channel, which features solutionsbased benefits such as L-carnitine and less fat to maintain or lose weight, prebiotic fiber for high digestibility, Omega 3 and 6 fatty acids for skin and coat health, and glucosamine and chondroitin for mobility support.

Minerals and botanicals are also gaining interest; for example, the Thai Lifemate premium brand, which was introduced in 2021, contains ingredients for improving skin and hair, as well as the excretory system. Petcurean added skin and coat formulas to its GO Solutions line and also

Human Demand For Sustainability Is Reshaping The Pet Food Industry

Sustainability has long been a consumerled initiative, and the pet health market is no exception. Consumers are increasingly demonstrating high awareness of the social impact of the goods they buy and are opting for more eco-friendly and ethically sourced products. Scoular, a company that buys, sells, stores, handles, and processes grain, feed, and food ingredients, is one of the companies seeing the sustainability trend impact things on the ingredient side. “We are seeing strong demand for certified sustainable fish and seafood,” said Justin Stadden, product group manager in Scoular’s feed division. “Specific species of farmraised seafood, like salmon or cod, allow pet food manufacturers to reduce the supply risk while providing customers a compelling product story.”

Biomega Group has developed technology that generates zero waste in salmon harvesting and processing. Parts that don’t go into the human food chain are used to deliver nutrients, healthy fat, and protein to pets. Freshpet’s Nature’s Fresh brand has recently been revamped to source sustainable proteins like certified humanely raised organic turkey and grass-fed beef from regenerative family farms.

Finnish start-up Alvar Pet was also early to identify this white space and offers carbonneutral dog food subscriptions to help dog owners decrease their dogs' carbon paw print without compromising nutritional quality or service. Alvar Pet claims it acts sustainably in every step of the operational chain, substituting conventional dog food ingredients with locally sourced Nordic ingredients.

Insect-based pet food has been gaining traction among consumers for its sustainable credentials, and the use of insects in pet food is now backed by major global players. As a result, a report from consulting firm MarketsandMarkets projects the global market for insect protein will grow from US$144 million in 2019 to US$1.3 billion by 2025. Pet food company, Jiminy’s star ingredient is insect protein. It started with roasted and ground crickets and expanded to “grubs,” or black soldier fly larvae to the satisfaction of dogs in particular.

Another standard meat alternative picking up pace is lab-grown pet food. Bond Pet Foods, for example, has been experimenting with biotechnology to make animal-free and proteinrich pet food. Its first product, the Protein-Packed Dog Treat Bar, is made with cultured meat protein, providing a high-quality, sustainable supplement to a dog's existing diet.

PET WELLNESS: THE PRESENT AND FUTURE

The prioritization of pet wellness is a trend here to stay this year, heavily influenced by pet owners' purchasing habits. The pet food offerings that are likely to see the greatest success in 2022 and beyond are those that are customized and speak directly to the personal needs of pet owners who want the absolute best for their pets.

The market for high-quality pet food will continue to trend up, observers say. As consumers demand healthier, more sustainably sourced food for their own plates, they want the same for their pets’ bowls. However, pet owners remain largely undecided concerning the role of pet diet in pet health but with increasing knowledge, pet owners will become more discerning in choosing the appropriate nutrition for their pets, creating new opportunities for brands to leverage their science-based strengths.

What is even more interesting is that most of the new pet owners are in the 16-31 years age bracket, meaning that the pet food market will continue to be there in the long term. Conservative estimates put the pet food market size at US$170.11 Billion in 2030. Those are a lot of billions that are up for grabs. Innovation around pet health and wellness in addition to sustainability will however become key for anyone seeking to succeed in this highly lucrative market. MMEA

Bond Pet Foods

Dog Teat Bar is made with cultured meat protein