• Brazil and Latin America are hot areas for pet food; Brazil is the second largest market for pet food in the world (after the US) and is also fast-growing, while the region as a whole is seeing an increase in NPD activity

• More expensive types of pet food (snacks and treats and wet dog food) are seeing more NPD activity, while dry pet food is not seeing as much innovation

• Natural sourcing continues to be an important trend in new pet food launches, while manufacturers of pet food are also increasingly introducing low allergen formulations, meeting consumers’ wishes

With volume sales estimated at around 8 million tonnes in 2014, the US remains the largest pet food market by far, with Americans showing the highest volume consumption per capita for pet food (25kg annually). In contrast, very fast-growing markets such as India and China go through less than 1kg of pet food per capita annually.

Brazil is particularly notable here, being the second largest market based on volume sales (2 million tonnes in 2014) and having grown by 10% annually on average in the last five years. Volume consumption of pet food is also above average at 10kgs.

Figure 1: Global market performance, pet food, 2014

Note: The size of each bubble represents the respective size of the market in volume

* Market volume and volume consumption per capita are based on forecast for 2014

Source: Retail World, Economist Intelligence Unit, ABINPET, FACCO Association, Information Resources, Inc, LSA Magazine, Destatis, Information Resources, Inc, Assalco, The Ministry of Internal Affairs and Communications of Japan, CBS, The Nielsen Company, Statistics Korea, Publicaciones Alimarket S.A., InfoScanCensusTM, IRI España, U.S. Bureau of Labor Statistics, American Pet Products Association, Mintel

NPD activity in Latin America has also been increasing lately, with the region now accounting for 10% of global launches, up from 6% in 2011. The dominant region remains Europe however, with 45% of launches in 2015.

Globally, more new launches in pet food target dogs than cats, although the exact proportion tends to vary by region. For example, cat food is most important in Europe (46% of NPD), while dog food strongly dominates new product activity in North America (77%) and Latin America (75%).

Figure 3: Pet Food NPD, % by region and type of pet food, 2015

Source: Mintel GNPD

It is actually the big ticket items that tend to cost more in pet food that have seen more activity recently, with dog snacks and treats, wet dog food and cat snacks and treats that have seen an increase in NPD between 2011 and 2015.

Dry cat and dry dog food have both seen a slight drop in activity between 2011 and 2015, even though they tend to be more economical to purchase than wet food, showing that manufacturers are focusing their NPD activity on higher-value products such as wet pet food and snacks and treats.

Natural sourcing continues to be an important issue in 2015 when it comes to pet food NPD, as the no additives/preservatives claim is now the second most important claim and is noted in 34% of new launches in 2015.

Another area that has seen some growth recently are low/no/reduced allergen formulations, noted in 16% of pet food launches of this year, up from 6% back in 2011. This is mainly due to manufacturers introducing pet food ranges that allow cats and dogs to return to their “wild” roots, with formulations focusing on protein and meat content, avoiding grains and gluten that are often used as fillers, something that many consumers want to avoid these days.

While functional claims are important in pet food, there has been a decrease in products that feature vitamin/mineral fortifications, as manufacturers prefer to position their products as improving different areas of health rather than simply being topped up with random nutrients.

* Please note: the market size data referenced in this report is current as of January 31, 2016