Despite inflationary pressures, pet food market in Eastern Europe is coping with the situation. In 2023, the rise in prices for ready-made pet diets did not significantly affect the consumer behavior of dog and cat owners in the region. Industrial pet diets continue to enjoy high demand and broad export opportunities, including outside the EU.
In Poland, in March 2023, the average cost of pet food jumped by 43% compared to the previous year, according to UCE research and Merito WSB University. The same trend was observed in other markets of the region. In Hungary, at the beginning of 2023, average pet food prices rose by 50% compared to the previous year, as estimated by the Hungarian Food Industry Federation. The organization expressed concern that in the context of a growing cost-of-living crisis, consumer demand could be threatened. However, experts’ fears were unfounded. Market turbulence subsided, and inflationary pressures significantly eased in the second half of 2023.
Aleksandras Batsevicius, an analyst at Euromonitor International, notes, “The cost-of-living crisis has virtually no impact on pet food sales. Historically, the pet industry has proved to be more resistant to recession than other FMCG sectors. The pet market has shown growth even during previous economic difficulties, such as during the Great Financial Crisis and the COVID-19 pandemic.”
Over the last decade, the rise in prices for pet food in Eastern Europe has always been higher than the average GDP increase, except in 2015. However, their sales have consistently increased during this period. Transitioning to premium-class products remains one of the main trends in the market: according to Euromonitor International, in 2022, the cost of premium-class dog and cat diets increased by 6% in constant prices per unit of production.
The pet food market in Eastern Europe grew by 5% in value terms in constant prices per unit of production in 2023, with not only basic diet manufacturers thriving but also cat and dog treats. Going forward, expenses on companion animals in Eastern Europe will continue to rise. In 2023, the average owner spent about €108 on a pet, 3% more than in 2022, in constant price per unit of production.
According to Aleksandras Batsevicius, the cost-of-living crisis affects the industry. Some pet owners have turned to cheaper offers under private labels. The share of such products is growing, outpacing inflation. In 2022, it accounted for 15% in current price terms.
The expert believes that 2024 will be another year of growth for the pet food market in Eastern Europe, with both value and volume increasing by 4% and 3% respectively. Over the last two years, Eastern Europe has strengthened its position as an export region, primarily thanks to Poland, which in 2022 became the fifth largest pet food exporter in the world – export sales amounted to €1.9 billion, accounting for 4% of Polish agri-food exports.
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