Sales of petfood and pet care products are surging in Latin America, led by the Brazilian market, according to the Latin Business Chronicle.
Over the review period of 2005-2010, sales of petfood and pet care products rose from US$4.8 billion to US$8.3 billion, according to Euromonitor International data. This represents a compound annual growth rate of 11.9%. The proportion of global pet care sales from the Latin American market rose from 7.6 % in 2005 to 10.2% in 2010. Brazil is the region's largest market with pet care sales of US$5.2 billion in 2010, followed by Mexico with sales of US$1 billion and Argentina with sales of US$645 million. Income growth in Latin America is attributed to the increase in pet industry value sales. According to Euromonitor International data, the proportion of Brazilian households with an annual disposable income of at least US$25,000 rose from 21.7% to 30.1% over the review period, while Argentina saw a greater increase from 33.5% to 44.8%.
Brazil's National Association of Pet Food Manufacturers, ANFALPET, reported the average unit price of dog food and cat food in the country saw increases of 7% and 5%, respectively, in 2009, meaning many consumers in the region have absorbed these price increases. Euromonitor International data also found growth in value sales of economy dog and cat food in Latin America slowed only marginally from 13.9% in 2008 to 10.5% in 2009, and recovered to 14.5% in 2010. Sales of mid-priced products saw growth slow from 15.9% in 2008 to 8.3% in 2009, before recovering to 10.6% in 2010. Growth in premium petfoods in Latin America fell from 10% in 2007 to 2.7% in 2008, but rebounded to 4.2% in 2009 and surged to 12.3% in 2010, according to the Euromonitor data.
Overall, pet healthcare sales in the region rose from US$69.4 million to US$119.1 million over the review period, an increase of 71.6%, according to Euromonitor data. The data also showed sales of other pet products, like clothing, jumped nearly 36% to US$334 million.
Euromonitor International predicts that Latin American pet care value sales will exhibit a compound annual growth rate of 5.5% over the 2010-2015 period, to US$10.9 billion (in 2010 prices). This will represent a significant slowdown from the review period due to threats of inflation and commodity dependence, according to Euromonitor.
By Lindsay Beaton
As work continues on creating a new nutrition label that focuses on simplifying information for consumers, challenges remain.
By Tang Yu