Increased levels of cat and dog ownership in the mainland are starting to create potential niche opportunities for foreign pet food suppliers.
CHINA'S RISING URBAN incomes have made cat and dog ownership more affordable, and while government regulations covering specific types of pet ownership are strict, enforcement has become lax. A new report by the USDA Foreign Agricultural Service cites the case of a Guangzhou supermarket executive who said that it cost about Yn1,500 to feed and care for his dog every month. For other owners, the cost tends to be less.
The price of bagged cat and dog food in southern China is about Yn20 per kilogram, and slightly more for canned food, says the report. Much of the pet food sold in supermarkets is the dry variety and is usually sold in heavy-duty laminated paper bags. Most imported pet food comes in cans.
The largest producer in China is $%% & # in Beijing, which makes Whiskas cat food and Pedigree dog food. The company also sells some products made in its overseas factories in China. Whiskas and Pedigree are the only nationally distributed cat and dog foods in China. Effem manages separate Chinese-language websites for each of its major brands. The sites contain product information and feeding and care advice for pet owners.
Nearly all Effem's competitors offer only a single variety of product for dogs or cats; most are in dry form and available in only one size. Heinz's Nine Lives cat food and Skippy dog food are becoming increasingly available in various Chinese cities, although they are produced in the US.
Chinese exports of pet food have plunged in recent years – from 13,892 tonnes in 1999 to just 1,074 tonnes last year – to the extent that the country is now a net importer. Japan used to be the largest export market, but it was replaced by the US last year. Australia is by far the main source of imports, mainly because Effem ships much of its imports for retail sale from there. The effective import tariff for cat and dog foods is 42 per cent.
