Sector Trend Analysis – Pet food trends in Taiwan

Pet population and ownership

Taiwan consumers favour fish and small animal pets, which make up the largest pet population categories in the country. All categories, except for dogs, grew over 2018 to 2022 with small reptile and mammal (hamsters, rabbits, etc.) populations growing the fastest. The dog population decreased 4.6% annually from 2018 to 2022. The populations of all pets are expected to increase through 2028 with highest growth in medium/small dogs, cats, and small mammals/reptiles.

The ageing human population and increasing awareness of the importance of mental health are set to be two major market drivers. According to Euromonitor, in 2022, the number of pets exceeded the number of children under the age of 15 in Taiwan for the first time. Pet owners have increasingly come to regard their pets as relatives or even children, while pet food has also become more humanized. As the number of pets is on the rise in Taiwan, increased pet ownership has expanded the demand for pet food, with more pet owners willing to spend on products that can take care of the health and quality of life of their pets. The overall pet food trend is also expected to mirror trends in the eating habits of young humans of eating well and healthily. Pet food has evolved from traditional dry food and wet food to fresh food, emphasizing freshness, natural, and less processed, healthy and balanced nutrition, such as fresh food dishes and freeze-dried snacks.

From 2018 to 2023, the percentage of households owning a cat rose 3.2% annually, while the number of households that owned a dog fell by2.6% annually. According to government statistics, the decline in birth rates and rise in single living have boosted the cat and dog populations.

Retail market size

Retail sales of all pet food categories grew from 2018 to 2022 by 9.2% annually with cat food (18.5%) and bird food (17.4%) surging. The growth rate in pet food is forecasted to slow to 5.2% over 2023 to 2027. Taiwan's ageing population and focus on mental health will be major market drivers behind growth in the country's pet care industry. Bird food and cat food are expected to continue leading growth through 2028 at a lower rate, while all other categories are also forecasted to grow through 2028.

Company shares

The Taiwan pet food market is highly fragmented. The top ten players include Mars Inc, with a 10.9% market share, followed by mostly foreign companies accounting for between 1.5% to 3% market share.

According to Euromonitor, while premium US brands were in short supply due to supply chain disruptions from a US bird flu (HPAI) outbreak, Taiwanese consumers benefited from a lower Japanese yen that led to a large supply of Japanese brands such as Ciao and AIXIA. Other Asian brands increasingly entered the Taiwanese market, including Korean and Thai. Local brands such as DogCatStar and Lito Monster further expanded their market shares with more product variety and price ranges.

Brand shares

In 2022, five of the top ten pet food brands in Taiwan were owned by Mars Inc. Mars saw sales growth of their Whiskas brand surge over 2018 to 2022 by 17.1% annually. Ales of Inaba's Ciao brand cat treats grew fastest by 40.4% annually followed by Classic Pets brand by 20.5% annually.

Market segmentation

Dog food

Total retail sales of dog food increased 4.8% annually from 2018 to 2022, led by wet dog food, which increased 7.0%, followed by dry dog food (3.9%). Premium dog food accounts for over half of all dog food sales in Taiwan with economy dog food representing a tiny part of overall sales. All dog food categories are forecast to surge over 2023-27, led by mid priced dog food categories. Sales of dog treats and mixers are over twice the size of economy dog food sales in Taiwan and show strong historical and forecast annual growth of 10.7% and 7.8%.

Mars Inc. is the largest player in the Taiwan dog food market, with a market share of 20.6% in 2022, followed by Chareon Pokphand (5.9%), and Fwusow Industry (4.9%).

According to Euromonitor, the ratio of local to imported brands in pet food products is estimated to be around 40:60. Locally manufactured pet food has a competitive edge in Taiwan with various mechanisms in place to gain consumers' trust. These include a government certification system, such as the SNQ national quality label, the pet food declaration network, the establishment of the pet management department, and the national brand Yushan Award. With these in place, local products are expected to gradually rival competitors in mid-to-high-end imports. Local brands such as GOMO Pet Food by DaChan Foods should increasingly move towards quality with premium ingredients such as fresh, natural, and additive-free and compete with international branded manufacturers.

For example, Fwusow is the local leader accounting for the strongest share among local players. Fwusow's leading brands, Pro's Choice and Greens directly compete with imported global brands. Fwusow's strategic strength is in the raw materials it sources and the quality of its pet food products, including its use of local non-GMO corn to produce pet food. Fwusow has developed pet nutrition tailored to the country's hot and humid climate as well as the physical characteristics of local dogs and cats. Fwusow is also the only pet food manufacturer among local players with the capability to develop prescription pet food.

Cat food

Total retail sales of cat food increased 18.5% annually over 2018 to 2022, led by mid priced wet cat food, growing 24.1% annually. Dry cat food accounts for 67% of all cat food sales in Taiwan and grew 15.8% annually. Sales of all cat food categories are forecast to grow at a slower pace over 2023-27, led by sales of wet cat food categories. Sales of cat treats and mixers in Taiwan is comparable in size to sales of premium wet car food and show strong annual historical and forecast growth of 30.6% and 9.2%. Cats usually consume more wet food than dogs with this trend increasing as cat lovers are increasingly concerned about the nutritional content of their cat's main meals.

Company shares

Mars and Nestle dominate the top ten cat food brands over 2018 to 2022. Mars carries a wide range of brands across all price points, from Whiskas in mid-priced wet and dry cat food to Sheba in premium wet cat food. The economy price band is also well catered for with the Kitekat brand, which is present in both economy dry cat food and economy wet cat food. Wet cat food brands such as Seeds, Sheba, Unicharm, AIXIA, and Mon Petit focus on natural ingredients as pet owners are increasingly concerned about the allergy, inspection, and safety of pet food.

Truluxe, LOVCAT, and NU4PET are some of the new examples of wet cat food brands with premium quality being introduced at affordable prices. These and other local brands such as Lito Monster and DogCatStar are also becoming more prevalent and capturing growing category shares with more product variants and a wider range of prices. These brands are meant to cater to young cat owners who like to explore contemporary cat food brands over the leading brands. This group of cat owners is usually single, unmarried middle to high-income earners aged 29-34, who are time-pressured and seek companionship, where the cat takes on the role of life partner.

Distribution channels

In 2022, pet shops and superstores sold the most dog and cat food in Taiwan, followed by ecommerce. Ecommerce performed best over 2018 to 2022 with sales growing 18.8% annually and an increasing market share.

According to Euromonitor, except for a few well-known international brands, consumer awareness of brands is limited in Taiwan. The most important considerations are word-of-mouth recommendations as well as recommendations from stores and veterinary hospitals. Therefore, when a new brand seeks to establish a relationship with consumers, it is best to provide enough trial products and experiences to enable pets to trial their products and owners to then share their findings on social media.

Taiwan imports

In 2022, Taiwan imported Can$352.6 million worth of dog/cat food from the world, with imports growing 10.9% annually over 2018 to 2022. Imports from the top five supplier countries, except the US, grew strongly, with imports from South Korea growing fastest, by 119.3% annually. Imports from Canada, Taiwan's fourth largest source country, grew by 11.3% annually from 2018-2022.

According to Euromonitor, Thailand is the largest origin country of wet cat food in Taiwan. Thai-origin wet cat food includes popular brands such as Seeds, Sheba, Unicharm, AIXIA, and Mon Petit. US sourced pet food saw significant fluctuations over 2018 to 2022, with leading US brands such as Hill's and Royal Canin facing severe challenges in meeting cat food demand due to a bird flu outbreak as well as international logistics impacted by the pandemic. In addition, lower inventory of US product, higher input costs, and a high exchange rate pushed pet food prices up in 2022, which made it more expensive to import US products with retail prices increasing as much as 10-15%.

Product launch analysis

From 2018 to 2022, 404 pet food products were launched in Taiwan. Dog snacks and treats, wet cat food, cat snacks and treats, and wet and dry dog foods were top categories of newly released pet food product launches while no additives/preservatives, vitamin/mineral fortified, and low/no/reduced allergen were top claims associated with new pet food products released.

Product examples

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Resources

• Euromonitor International:
  • Country Report | May 2023, Pet care in Taiwan
  • Country Report | May 2023, Cat Food in Taiwan
  • Country Report | May 2023, Dog Food in Taiwan
  • Country Report | May 2023, Pet Products in Taiwan
• Global Trade Tracker, 2023
• Mintel, 2023

Sector Trend Analysis – Pet food trends in Taiwan
Global Analysis Report

Prepared by: Kris Clipsham, Market Analyst

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