Delicacies are leaving the diet of dogs and cats due to difficulties with imports

Usually stable even against the backdrop of a general reduction in consumer spending, the market for pet products is in crisis. From May 2022 to May 2023, in-kind pet treat sales—formerly the fastest growing category—decreased by more than 9% year-on-year, the worst performance of any segment. The dynamics is explained by savings and a reduction in the range due to difficulties with imports. Experts are waiting for the proposal to be restored.

Pet treats, once the market driver, have the worst sales performance of any category, according to NielsenIQ data. According to analysts, in May 2022-May 2023, sales of treats in physical terms decreased by 9.1%, while in money terms they increased by 3.9% year-on-year. By comparison, cat food sales over the period increased by 2.4% in volume and 27.6% in value, while dog food decreased by 3.3% and rose by 20.1%, respectively. From March 2021 to March 2022, in-kind treats grew by 14.7% year-on-year, while cat and dog food sales grew by 5.6% and 9.3%, respectively, NielsenIQ reported.

According to a NielsenIQ study, 72% of Russians own pets, cat owners on average have one pet, and dog owners have two. As analysts have noted, many consumers tend to cut spending on pet purchases last. But the trends towards savings and the revision of consumer strategies caused by the crisis may also affect this market, the study notes.

Kirill Dmitriev, President of the National Association of the Pet Industry, attributes the decline in sales of treats to the general economic situation in the country and a decrease in purchasing power. According to him, sales of delicacies were especially pronounced in the spring of this year. General Director of the Union of Zoobusiness Enterprises Tatyana Kolchanova points out that the priority for pet owners is to provide their pets with food, veterinary drugs, services, and prices in this area are growing. According to her, over the past six months, imported and local food has risen in price by an average of 20-30%, prices for services in clinics have increased by 20%, and the cost of treats has similarly increased. But consumers are ready to save on the latter, Ms. Kolchanova points out. The Pet Food Manufacturers Association (which includes Mars, Nestle, AllerPetfood) declined to comment.

Difficulties with the import of pet products, which worsened after the outbreak of military operations of the Russian Federation in Ukraine, had a negative impact on the supply of treats. Wildberries reported that as of May 2023, the assortment in the category was reduced by about 15% year-on-year. According to Kirill Dmitriev, the assortment could be affected by the refusal to supply some foreign manufacturers and the logistics that have not yet been rebuilt for the import of foreign products. According to his estimates, in 2020-2021, imports accounted for 20-25% of all pet food, in 2022 – 10-15%, a similar ratio in the category of treats.

Mikhail Burmistrov, CEO of Infoline-Analytics, notes that the consequences of rush purchases for future use in the spring of 2022, when Russians feared a rise in prices for imported products and the departure of foreign brands, may still affect the pet products market. Accumulated stocks are now running out, which may affect sales growth, he said. According to Mr. Burmistrov, savings will be expressed in the transition of pet owners to cheaper feed, including Russian manufacturers, which are now increasing their presence in the Russian market, with the exception of specialized lines. And the assortment of delicacies, according to him, will grow due to the products of small players presented on online platforms.

Kirill Dmitriev adds that many new brands of pet products from friendly countries – Turkey, China, Brazil and Argentina – have also appeared on the Russian market, but the process of consumer and business transition to them has not been completed.

Polina Gritsenko, Anatoly Kostyrev