The pet food market witnessed sluggish growth in China last year, due to the frugal consumption environment, industry analysts said.

Pet food still remains a very small, but a primary, segment in the nation's fast-moving consumer goods market. About 7.5 percent of Chinese families buy pet food, while 20 percent of the urban families own pets, according to statistics from global market consultancy Kantar Worldpanel.

Growth rates in the pet food segment slowed during 2014 and were a tad lower than the 10 percent growth seen in 2013, said Jason Yu, general manager of Kantar Worldpanel, however, the lower growth rate did not affect consumers who had already formed purchasing habits. Consumers who had occasionally bought pet food might have had second thoughts while shopping, said Yu.

Pet food consumption is more popular in top-tier cities where residents have higher incomes and are better educated on pet nutrition. The number of residents buying pet foods in top-tier cities such as Beijing, Shanghai and Guangzhou rose by 33.7 percent, while the growth was 31.5 percent in provincial capitals and 22.6 percent in prefecture level cities. "Residents in lower-tier cities or rural areas raise pets but they don't necessarily buy professional pet food," he said.

Pet food products are often sold in bulk and have high customer loyalty heavily rely on online retail platforms compared with other categories of fast moving consumer goods, Yu said.

Looking ahead, UK-based MintelGroup Ltd, a privately owned, London-based market research firm, has forecast that China will be top volume growth market for pet foods in the next five years, with an 18.5 percent annual growth rate and value growth of 22.3 percent.

Chinese consumers are also well aware of food safety issues and nine out of 10 believe manufactures should do more on transparency and provide more sourcing and food safety information, the report said.

(China Daily USA 03/23/2015 page15)