Looking back to the decade of grunge and three-button suits, the Producer Price Index (PPI) for the Dog and Cat Food Manufacturing industry offers insight into the evolving cost structure of pet food production in the United States since the 1990s. The PPI index tracks average changes in selling prices received by domestic producers using U.S. Bureau of Economic Analysis data and published by the Federal Reserve Bank of St. Louis. This reflects shifts driven by raw material costs, supply chain dynamics, formulation trends and broader economic conditions.
Over the past four decades, the PPI for dog and cat food manufacturing has evolved from relative stability to marked volatility and structural cost increases.
1990s: A stable cost structure with minimal volatility
During the mid-to-late 1990s, the PPI for dog and cat food manufacturing moved within a narrow band, rising only slightly from roughly 133 in 1995 to 139 by the end of the decade. The period was marked by relative stability in ingredient markets, steady commodity prices and fewer external shocks to the supply chain. Manufacturing processes were well established, and premiumization had not yet reshaped formulations or sourcing. For pet food makers, margins were generally predictable, and cost planning relied on gradual, incremental adjustments rather than significant year-over-year volatility.
2000s: Gradual buildup followed by a sharp spike
The early 2000s continued this slow upward creep, with the index climbing from about 137 in 2000 to the low 150s by mid-decade. Incremental increases reflected modest inflation in meat meals, grains and packaging. That changed dramatically toward the end of the decade. Between 2006 and 2008, the PPI surged from around 154 to nearly 193 — a jump driven by global commodity inflation, especially in agricultural inputs, along with rising transportation and energy costs. This era also overlapped with the 2007–2008 melamine recalls, which pushed companies to adjust ingredient sourcing and testing programs, adding compliance-related expenses that contributed to the rising index.
2010s: Steady, structural growth in manufacturing costs
The decade beginning in 2010 brought a more consistent, year-to-year increase in manufacturing prices. The index rose from roughly 202 in 2010 to 245 in 2020, marking a long stretch of sustained cost escalation. Structural drivers shaped this pattern: rising labor costs, higher demand for premium formulations, increased use of animal proteins and functional ingredients, and continued compliance investments following the Food Safety Modernization Act. Pet humanization accelerated during this period, pushing manufacturers to adopt more expensive inputs and technologies, which in turn lifted the baseline for manufacturing expenses.
2020s: Historic volatility and a new cost plateau
The current decade has been defined by unprecedented cost turbulence. The PPI remained stable entering 2020 but jumped from about 245 at year-end to more than 300 by 2022 — the steepest two-year escalation in the 30-year record. Pandemic-era disruptions drove ingredient shortages, transportation bottlenecks and significant labor constraints. These pressures peaked in 2022, then moderated, but prices did not retreat. Since 2023, the index has held steady around the low-to-mid 300s. This suggests a structural reset rather than a temporary spike, creating a new baseline that manufacturers must navigate through sourcing strategy, contract management and operational efficiencies.
