iResearch Consulting: It is expected that the size of the Chinese pet market will exceed 340 billion yuan in 2024.

iResearch Consulting stated that according to data analysis and calculations, it is estimated that the size of the pet market in China will reach 345.3 billion yuan by 2024, with a growth of 5.8% compared to 2023, and a CAGR of about 7.8% from 2019 to 2024. In 2024, the size of the pet food market will reach 166.8 billion yuan, accounting for approximately 48%, the highest among the four major categories; the pet medical market will reach 94 billion yuan, accounting for approximately 27%; the pet supplies market will reach 51.3 billion yuan, accounting for approximately 15%; and the pet services market will reach 33.2 billion yuan, accounting for approximately 10%. According to related data calculations, the penetration rate of pet dogs in domestic households was about 17.8% in 2023, and is expected to reach 19.4% by 2026; the penetration rate of pet cats in domestic households was about 16.4% in 2023, and is expected to reach 18.6% by 2026. Currently, the domestic pet penetration rate is about three times lower compared to mature pet markets like the United States, and about twice as low compared to countries with similar ideologies and living environments like Thailand and Japan. However, with the growth of domestic residents' consumption capabilities, the domestic pet penetration rate is expected to further increase, releasing potential market space. Technology empowers traditional products, and smart products continue to be popular The rapid development of technologies such as artificial intelligence, the Internet of Things, and big data has provided technical support for the intelligence of traditional pet products. The application of these technologies not only enhances the functionality of products, but also improves user experience. Smart pet products address pain points in aspects such as time, health monitoring, safety, entertainment, and convenience for pet owners, improving the quality and convenience of pet ownership, and also driving innovation and development in the pet products market. By 2024, the market size of smart pet products in China is approximately 10.2 billion yuan, accounting for about 20% of the overall pet products market size. In terms of pet-specific equipment, international brands such as Siemens and Abbott dominated in the early stages. With companies like Mindray and Union Imaging entering the pet market, the overall domestic substitution rate for pet-specific equipment has reached 58%. With more domestic enterprises entering the market, the domestic substitution rate for devices is expected to further increase. In terms of consumables, although some consumables required for precision surgery are still mainly imported brands, large and small pet hospitals in China have already implemented most of the domestic consumable substitutions in other categories. As of the first half of 2024, the domestic substitution rate for pet-specific consumables is approximately 77%. In recent years, with the changing attitudes of pet owners towards pet care, pet identities have become more "humanized". In this context, pet insurance, as a new emerging service in the pet industry, has emerged. Currently, pet insurance in China is mainly divided into categories such as disease insurance, accident insurance, liability insurance, etc. Insurance companies such as Zhongan Insurance, Taiping Insurance, Ping An Insurance, etc. have also gradually entered the market. Comparing with Japan, which has similar pet care environments and social structures to China, from 2008 to 2023, rapid growth can be seen in the pet insurance market in both insurance companies and pet owners. In terms of penetration rate, China's pet insurance penetration rate has considerable growth potential compared to leading countries. Trend Outlook The Chinese pet industry is still in a state of increasing disorder, but signs of decreasing disorder are emerging From the perspective of entropy theory, the Chinese pet industry is still in a stage of increasing disorder, where the "disorder within the system increases". Due to the rapid increase in the number of industry players, the current domestic pet industry market is filled with a large amount of chaotic competition, and the lack of more effective market supervision policies has led to chaotic situations in the market. However, any mature industry will go through a process of increasing disorder, and it is important to find the "method of decreasing disorder" to counteract the increase in disorder. Currently, the Chinese pet industry has begun to show signs of "decreasing disorder": for example, the first national recommended standard for pet products was officially implemented in October this year; in the same month, Shenzhen released the "Pet Nine Rules" in Futian District; some pet food, supplies, and drug brands actively innovate independently, focusing on pets and pet owners, moving away from homogeneity and low-price competition. In the long term, the Chinese pet industry will gradually move towards the "road of decreasing disorder" and develop into a more mature and healthy market. Expanded dry food still dominates, and the feeding concept of pet owners will trend towards current trend-type products Currently, in the domestic pet main food market, dry food is still the first choice for pet owners, and although wet food retains nutrients and palatability higher than dry food, it is generally more expensive than dry food. Looking back at the feeding concepts of pet owners in the past, from leftovers to commercial dry food, it reflects an improvement in pet owner care concepts, pet food awareness, and consumption capabilities. With the continuation of this trend, pet owners in the future will pay more attention to the dietary health of pets. With the increase in consumer purchasing power, pet owners will be more willing to buy high-nutrition, highly palatable main food. In the future, as the material and ideological levels of pet owners continue to improve, coupled with external policy regulation, categories with high nutrition and high palatability products, although currently expensive, will gradually replace expanded cereals. Emotional needs will become the main decision-making factor for pet owners, and the future growth of the toy category is expected American psychologist Abraham Maslow believed that humans have five levels of needs: physiological needs, safety needs, love and belonging needs, esteem needs, and self-actualization needs, with the first two being material value needs and the last three being spiritual value needs. In the current trend of pets being increasingly "humanized", pets, like humans, have both material and emotional needs. As pet owners gradually realize that "pets have emotional needs in addition to material needs", pet owners will prefer products that can meet the emotional value of pets. Among traditional pet supplies, the toy category is the category that can bring the most emotional value to pets. From social media volume from January to September this year, the volume of pet toys has almost doubled, indicating the growth potential of the pet toy market. In addition, in September 2024, the share of dog toys in the "pet toy" keyword note classification on Xiaohongshu accounted for nearly 50%, but with the increasing number of pet cats, cat toys may become more visible in the future. Domestic animal protection enterprises continue to expand into pet medicines, and the development of new animal medicines for class one and class two pets is the key direction 2019.In the first half of 2024, the pet-related revenue of two major overseas animal protection giants, Shuoteng and Lilan, accounted for 60% and 51% respectively. The pet-related businesses of these two companies have now surpassed their livestock businesses. The change in business direction of international animal protection giants indicates that these companies are gradually shifting towards the pet medicine track. Domestic animal protection listed companies, such as Tianjin Ringpu Bio-Technology, Wuhan Keqian Biology Co., Ltd., Pulike Biological Engineering, Inc., and China Animal Husbandry Industry, have also started to enter the pet industry track in the past decade. This is due to the rise of the pet industry trends and the decline in the prosperity of traditional livestock industries. Therefore, the transformation of animal protection companies may already be underway. In terms of pet medicine research and development, in October of this year, the second new animal pharmaceutical product for pets in China was approved for market, significantly increasing the confidence of domestic pet medicine companies in independent innovation and prompting more companies to engage in innovative research and development.La lluvia es una bendicin para la tierra.