The State of Play for Sustainable Ingredients in Pet Care
Challenges and opportunities offered by sustainable ingredients
Over the past few years, the trends within pet food ingredients have been in direct tension with sustainability. With the idea that pets need to eat meat – which they would eat in the wild – having been widely spread among pet owners, there has been increasing demand for meat-rich pet food formulations marketed as ancestral diets, which has significantly increased the carbon footprint of the industry. In addition, the relatively sustainable practice of creating pet food from discarded by-products from meat processing has fallen out of favour, as owners demand human-grade meat as the main ingredient.
At the same time, however, pet owners are now becoming increasingly concerned about the future of the planet and making sustainable changes to their pets’ daily routines. Data from Euromonitor International’s Global Lifestyles Survey show that these environmental concerns are significantly more pronounced among pet owners than non-pet owners, as nearly 70% of global pet owners report that they are “worried about climate change” and are “trying to have a positive impact on the environment through [their] everyday actions”, signalling a potential growth opportunity for pet food produced from sustainable ingredients.
Sustainable ingredients: Organic and plant-based
Within sustainable ingredients, organic and plant-based are two major sustainable ingredients gaining significant attention from consumers.
Organic is already the most common product claim in pet food, accounting for 2% of the total pet food SKUs tracked by Euromonitor International’s Product Claims Positioning system, but organic pet food is expected to grow yet further. Although 2021 saw a slowdown in growth as a backlash of the sharp uptake during 2020, demand for organic packaged food is expected to stabilise again over the forecast period, supported by the increasing number of health-conscious consumers and those who have greater awareness of environmental issues, which will cascade into the pet food market as well. Moreover, organic products are becoming increasingly accessible. Small, premium brands currently dominate the market, but in response to the growing demand, the industry’s biggest players, including Nestlé Purina, are launching organic product lines, with the latter introducing “Beyond Organic”. The number of organic private label products such as Zooplus BIO is also increasing, which is likely to further fuel demand for organic pet food.
Despite its marginal share in comparison with organic claims, accounting for less than 1% of total SKUs, plant-based has substantial growth potential considering the robust growth of flexitarianism. While the number of vegan or vegetarian consumers is low worldwide, the number of consumers trying to limit their animal product consumption is much more significant – for meat, this has now already reached more than 20% globally. Furthermore, pet owners are more likely to choose either vegan, vegetarian or flexitarian diets. This trend among pet owners is likely to be reflected in the products that they also choose for their pets.
Identifying a huge growth opportunity, major players are also entering this space, including Mars, which launched a new brand called KARMA in 2021, a dog food using plant-based superfoods as its main ingredient. New innovations such as insect protein or lab-cultured meat are also emerging, and highlight the future potential of product development using alternative protein sources within pet care.
The trend toward meat-rich, ancestral diet pet food, which moves the industry in the opposite direction from sustainability, is unlikely to disappear in the near future. However, pet owners are now increasingly seeking products that they perceive not only to be better for themselves and their pets, but also for the planet, highlighting huge growth potential for more sustainable and healthier pet food ingredients. Companies that invest in this new growth frontier should perform well over the forecast period.
This Featured Article has been produced by Euromonitor. Rize ETF Ltd make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability or suitability of the information contained in this article.
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Euromonitor International, “Sustainable Ingredients in Pet Care”, March 2022. Available at: https://www.euromonitor.com/article/sustainable-ingredients-in-pet-care