Food to fuel global pet economy’s climb to $500 billion

Bloomberg Intelligence

July 22, 2024

This analysis is by Diana Rosero-Pena, Bloomberg Intelligence Lead Analyst, Americas, Consumer, and Andrew Galler, Bloomberg Intelligence Lead Analyst, Global, Health Care. It appeared first on the Bloomberg Terminal.

Recent strength in food sales by companies including Mars and J.M. Smucker has set the stage for the global pet industry to expand more than 45% to exceed $500 billion by 2030. Population growth and the humanization of pets will be key drivers supporting premium niches. The US will remain the biggest market and Europe may account for about a third, though other regions may expand more quickly. Our scenario finds that China could grow more than 50% to $49 billion, with Alibaba dominating e-commerce. Investments from US pure plays like Chewy could push e-tail up 87% to account for nearly 30% of the pet economy. Complex, more expensive therapies can help expand the pharmaceutical industry by over 50% to reach $24 billion, with Zoetis likely to remain the market leader. IDEXX dominates in diagnostics.

Discover more with Bloomberg newsletters

Subscribe now

Key research takeaways

Food Growth Sets Stage: We expect the global pet food industry to expand nearly 7% this year and then about 5% annually to reach $146 billion by 2030. Food is the biggest ownership expense and limited elasticity allows suppliers to pass along higher costs.
Pets Fill in for Children in China: China’s pet economy can grow at a 6% compound annual rate through 2030, outpacing GDP projections of 3.5%. Pets increasingly are seen as substitutes for children, fueled by an aging population and declining marriage rates.
Next-Generation Drugs Stoke Growth: The pet pharmaceuticals industry could expand to over $24 billion by 2030, from about $16 billion now, driven by favorable demographics, consumer spending and — most important — development of novel therapeutics. Pain, oncology and cardiology can spur innovation and the emergence of blockbuster products.
E-Commerce Strength to Continue: Investments from US digital native Chewy and, to a lesser degree, Amazon may help e-commerce grow as much as 87% to $58.4 billion by 2030. Free shipping can breed customer loyalty and expand e-tailers’ baskets.
Supplies, Services Highly Elastic: Sales gains for supplies, equipment and services could remain slower than in other categories as they are the most at risk during economic downturns and high inflation. Greater investment in loyalty programs and other pockets of growth can aid customer stickiness.

Already a customer? Access the full report here.

Not a terminal user? Click here to learn more.

Disclosure

This is a synopsis of the full report. The data included in these materials are for illustrative purposes only. The BLOOMBERG TERMINAL service and Bloomberg data products (the “Services”) are owned and distributed by Bloomberg Finance L.P. (“BFLP”) except (i) in Argentina, Australia and certain jurisdictions in the Pacific Islands, Bermuda, China, India, Japan, Korea and New Zealand, where Bloomberg L.P. and its subsidiaries (“BLP”) distribute these products, and (ii) in Singapore and the jurisdictions serviced by Bloomberg’s Singapore office, where a subsidiary of BFLP distributes these products. BLP provides BFLP and its subsidiaries with global marketing and operational support and service. Certain features, functions, products and services are available only to sophisticated investors and only where permitted. BFLP, BLP and their affiliates do not guarantee the accuracy of prices or other information in the Services. Nothing in the Services shall constitute or be construed as an offering of financial instruments by BFLP, BLP or their affiliates, or as investment advice or recommendations by BFLP, BLP or their affiliates of an investment strategy or whether or not to “buy”, “sell” or “hold” an investment. Information available via the Services should not be considered as information sufficient upon which to base an investment decision. The following are trademarks and service marks of BFLP, a Delaware limited partnership, or its subsidiaries: BLOOMBERG, BLOOMBERG ANYWHERE, BLOOMBERG MARKETS, BLOOMBERG NEWS, BLOOMBERG PROFESSIONAL, BLOOMBERG TERMINAL and BLOOMBERG.COM. Absence of any trademark or service mark from this list does not waive Bloomberg’s intellectual property rights in that name, mark or logo. All rights reserved. © 2024 Bloomberg.

Bloomberg Intelligence is a service provided by Bloomberg Finance L.P. and its affiliates. Bloomberg Intelligence likewise shall not constitute, nor be construed as, investment advice or investment recommendations, or as information sufficient upon which to base an investment decision. The Bloomberg Intelligence function, and the information provided by Bloomberg Intelligence, is impersonal and is not based on the consideration of any customer’s individual circumstances. You should determine on your own whether you agree with Bloomberg Intelligence. Bloomberg Intelligence Credit and Company research is offered only in certain jurisdictions. Bloomberg Intelligence should not be construed as tax or accounting advice or as a service designed to facilitate any Bloomberg Intelligence subscriber’s compliance with its tax, accounting, or other legal obligations. Employees involved in Bloomberg Intelligence may hold positions in the securities analyzed or discussed on Bloomberg Intelligence.

Recommended for you

Request a Demo

Bloomberg quickly and accurately delivers business and financial information, news and insight around the world. Now, let us do that for you.