US-based manufacturer Mars plans to invest HUF 1.5 billion (US$5.5 million) in installing new production equipment at its Hungarian pet food plant, raising the headcount by 70 to around 900, according to Hungarian online news portal index.hu.

The plant has been in operation since 1993 in Bokros, southeast Hungary. So far the plant has produced animal food such as treats; however, due to new machinery, the Hungarian unit expects to manufacture chews that improve the dental condition of dogs. The plant exports 150,000 metric tons (165,347 US tons) of pet food a year to 25 countries in Europe and across the world, Hungarian news agency MTI reported. The companyʼs Budapest-based trade unit employs more than 100 people, MTI said.

Other big names in pet food taking advantage of a shifting European market

Mars is not the only company in the pet food industry expanding its impact in Hungary. By fall 2017, Nestlé plans to complete the HUF20 billion (US$72 million) expansion of its pet food plant in Bük, Hungary, reported PETS International.

Nestlé expects this pet food plant to become its largest and most important production center in Europe, reported Petfood Industry. It is the largest investment in the company’s history in Hungary, and will strengthen the role of Nestlé Hungária Kft. among the country’s top food industry investors.

The growth of major pet food plants in Eastern Europe reflects a shift in the European pet food market. In Western Europe, volume growth is at a standstill (and even negative in some countries) due to market maturity; nearly all growth that does exist is being driven by retail value (i.e., price increases). Eastern Europe is a different story: With both retail volume growth and value growth, there’s a lot happening to drive this developing segment of the pet food market.