Even though some Chinese still consume dog and cat meat, keeping pets has recently become very popular among the affluent in China. Spending on petfood and pet care products and services was worth an estimated US$870 million in 2008, according to Euromonitor International. That is up about 15% from the US$757 million spent in 2007. Spending on petfood and pet care is projected to reach US$995 million by 2009, up over 100% from US$463 million in 2004.

In Beijing, Shanghai and Guangzhou, a growing class of the nouveau rich see pets – particularly dogs – as fashion items, dressing them in designer outfits, paying for spa treatments and dyeing their fur. In the days of Mao, pets were considered an unnecessary indulgence. Now cute dogs sold in pet shops are spared, while unlucky dogs continue to be sold at live animal markets as the main ingredient in dog meat stew, a traditional dish purported to have medicinal benefits.

“In Beijing, there’s a huge market with pitiful dogs waiting in cages to be sold as meat, and literally a few yards away standard poodles dyed in all colors of the rainbow,” says Jill Robinson, chief executive of Animals Asia Foundation, an animal welfare charity based in Hong Kong.

There were almost 11 billion pets in China in 2007, according to Euromonitor International, up from 10.8 billion in 2006. The bulk of these animals, however, are birds, fish and reptiles. China estimates it has 150 million pet dogs in the country, although statistics are scant as many pets are unregistered. Euromonitor estimates that there are 10.7 million cats in China. According to experts, the industry’s potential in China is enormous as incomes rise and more of the country’s childless couples see pets as less needy substitutes for children.

Effem Foods in Beijing, a subsidiary of Mars Inc., claimed 53.8% of dog and cat food sales in 2006, according to Euromonitor data. Nestlé was in second with 17.7%, followed by Proctor & Gamble with 1.7%. Nestlé has also recently set up a production site in Tianjin to be more competitive locally, a move some experts say may not be wise given the spate of food safety scandals in China.