Ample opportunities in China's pet sector

At the height of the Covid-19 pandemic last year, China's agriculture ministry announced the reclassification of dogs from livestock to companion. The move is widely seen as a response to the coronavirus outbreak, which is believed to have originated from bats and spread to humans by intermediary species. The change, welcomed by animal welfare societies, is also expected to encourage pet ownership in the country.
"It is a big change in terms of the earlier official stance on this issue," Devi Subhakesan, analyst for Asia consumer research at Investory, told PET worldwide. "Technically, this would be an official acknowledgement that dogs and cats are human companions. As regards its impact on pet ownership, this move could possibly make it easier and less expensive to own a pet, assuming other changes like lower registration fees, permission to own bigger dogs, and others follow, which is likely."

The analyst authored a report entitled "Pet Care Sector in Asia: Saga has just started. Opportunities galore", which was published on research network Smartkarma. The report, which has a strong focus on China, notes that there is rising demand for pets due to reduced social activities - hence, heightened loneliness - given movement restrictions aimed at limiting the Covid-19 contagion. This increase in demand also supports the sector.
Other growth drivers include the treatment of pets as family members, which boosts premium product spending; the need for companionship by young singles, couples who delay having children, and the elderly, who see pets as mental support; the influence of social media and celebrities who post about their pets; higher income and more affordable pets; and the social status attached to owning a pet.
In the report, China's pet care industry was valued at 32 bn dollars in 2019, compared with negligible levels nine years earlier. Pet food contributed 19 bn dollars, health care accounted for 6 bn dollars, pet supplies made up 4.5 bn dollars, and other services, 2.5 bn dollars. The upsurge has been attributed to urbanisation, rising income, and an easing of rules. There are 55 mio pet dogs and 44 mio pet cats in the country, although some cities ban keeping canines that are taller than 35 cm.

The industry is nascent, having been impeded in past decades by a rabies scare and the view that owning pets was an indulgence. Among those who keep animal companions in the country, 80 per cent are first-time pet…