Nestlé Purina expansion will increase pet food exports

A new production hall in its Hungary pet food production facility will set Nestlé Purina up for more growth than the domestic market can provide, according to analysis.

(TTstudio | Fotolia.com)
(TTstudio | Fotolia.com)

Nestlé Purina has launched a new production hall at its facility in Bük, in Hungary’s north-west, making the plant its largest pet food production center in Europe.

“The factory serves 38 countries, including big markets such as Germany, Poland and Italy, besides Hungary,” said Andrea Nagy, the corporate communications and CSV manager at local subsidiary Nestlé Hungária Kft. “The main export countries of the new production line will be Germany and Italy, among others.”

NestlĂ© Hungária said the company’s export sales are expected to grow in the coming years as it is “completing the largest investment in its history,” worth some HUF20 billion (US$68 million). â€śWith this investment, the plant becomes NestlĂ©'s largest and most important pet food manufacturing center in Europe,” said the manufacturer’s Hungarian offshoot in a statement. “About 20 percent of the 1 million metric tons of pet food produced by NestlĂ© in Europe is produced in BĂĽk.”

According to Nagy, in addition to serving a number of export markets in Europe, the Hungary-based offshoot is developing its presence in the domestic pet food market. “NestlĂ© Purina has a value market share of about 15 percent in the Hungarian pet care market, and the segment is growing in a dynamic way,” said Nagy. With 90 percent of the Hungarian facility’s output intended for exports, this leaves some 20,000 metric tons for the Hungarian pet care market, and indicates that the industry has annual sales of about 133,000 metric tons. 

Nestle-purina-cat-treat-product

Purina’s Felix Party Mix snacks for cats come in multiple varieties sold all over the world. Countryside Mix snacks are flavored with duck, turkey and rabbit, and contain vitamins, proteins and omega-6. | Nestlé Purina

Focus on export sales key factor in plan for growth 

Nestlé Hungária’s focus on developing export sales is an important factor, as analysts forecast that the country’s pet food market will not experience rapid growth in the coming years. “Pet care is expected to benefit from improving economic conditions and Hungarians’ developing pet-keeping habits in 2016,” said analysis from Euromonitor International. “Although the pet population will record marginal growth, consumers will spend more on pet food and pet products due to accelerated lifestyles, changing attitudes towards their pets and further improving availability of pet care products. Nevertheless, growth is expected to slow down compared to the previous years as most categories reach maturity.”

The Hungarian pet care market is estimated to grow by a 3 percent value in compound annual growth rate (CAGR) at constant 2016 prices, according to analysis.

Hungary has a dog population of about 1.8 million and a cat population of more than 2.25 million. About 33 percent of households own at least one dog and 36 percent of households own at least one cat, according to figures from the European Pet Food Industry (FEDIAF) association.

History of the Hungarian facility

Nestlé Purina’s Hungarian plant was launched in 2011. The production facility, built under a project of about HUF10 billion (US$34 million), was initially fitted with a surface of 10,000 square meters (107,640 sq.ft.) and allowed the manufacturer to create some 250 new jobs in Bük.

Bük is located slightly more than 200 km (124.3 miles) from the country’s capital Budapest. In addition to Germany, Poland and Italy, the municipality’s location provides it with a good logistics capacity to other countries in the surrounding region, such as Austria, the Czech Republic, Slovakia, Ukraine, Croatia and Slovenia, among others.

 

More on the global pet food market

www.petfoodindustry.com/pet-food-market-data

 

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