Pet food companies made up 29% of the 113 food and animal nutrition companies surveyed for a new report from Datacor and Tech-Clarity, according to the study, titled "No Bull, No Hype: The State of AI in the Food & Animal Nutrition Industries."
The research, based on a survey of more than 250 companies with under $300 million in revenue plus additional analysis of 113 companies in the food and animal nutrition sector, found that AI adoption in the industry is moving faster than commonly assumed, even as companies face real barriers to implementation.
Formulation and lab work top the list
More than half of surveyed companies said they want AI to help formulate recipes to specification, the report found. Other common goals included identifying recipes for reuse and optimizing formulations around variable ingredients. The report noted that pet food companies face distinct constraints tied to nutritional compliance, and respondents pointed to a need for faster validation of ingredient substitutions without affecting taste or texture.
In the lab, 47% of respondents said they want AI to help analyze samples, a need the report tied to a shrinking pool of skilled quality assurance technicians.
Pilots delivering value quickly
Among companies that completed at least one AI pilot or proof of concept, 95% reported gaining value within a year, according to the report. Nearly half, 45%, saw value within a single business quarter. Still, 20% of companies that completed a pilot said they had not yet achieved value.
The report also found that 58% of companies have at least one AI pilot or proof of concept underway, and 31% have completed at least one. A smaller group, 5%, has made what the report described as significant progress, reaching measurable value at scale.
Knowledge gap cited as bigger obstacle than distrust
The report found that skepticism or fear of job loss is not the primary barrier to AI adoption. Only about one-third of companies reported distrust of AI or fear of job losses. Instead, 55% cited a lack of data science skills and 49% cited a general lack of knowledge as top challenges, with the same percentage citing a lack of time to focus on AI initiatives.
Fewer than one-third of companies reported a lack of executive support, which the report said suggests leadership backing for AI initiatives even where workforce readiness lags.
Companies cited caution around safety-critical decisions as a factor in AI adoption. One respondent, identified in the report as a technology leader at an agricultural cooperative, said, "There is risk around AI making decisions without human involvement."
To address implementation challenges, companies reported turning to existing technology and consulting partners: nearly two-thirds said they are relying on existing software providers, while 38% are working with existing consulting partners.
The full report is available here.
