Pet & Animal Food Manufacturers NAICS 3111

May 29, 2025 - Cooler Growth Forecast

• The US pet and animal food manufacturers industry is projected to grow at a CAGR of 3.54% between 2025 and 2029, slower than the overall economy's anticipated growth, according to a forecast from Inforum and the Interindustry Economic Research Fund, Inc. The nondurable goods manufacturing sector forecast indicates that the labor force is expected to diminish. However, new technologies could support labor productivity for the industry. Consumer sentiment is expected to improve in the forecast period, which bodes well for the sector. A factor that may curb consumer spending is substantially higher tariffs on consumer goods. In 2025 and into the forecast period, real disposable income may be supported by continuing nominal wage growth, lower inflation rates, and higher employment levels. Lower inflation supports a increase of real disposable income by 2% in 2025 and 1.9% in 2026. Real income could suffer if average prices rise due to tariff implementation.
• According to Pet Food Industry, marine-based ingredients increased 95% in usage in pet food formulations from the previous 2020 report. The ”2025 Pet Food Production and Ingredient Analysis” report was conducted by the Institute for Feed Education and Research (IFEEDER). The report found that the shift toward premium ingredients has led to marine products now representing the highest-value ingredient category, generally due to salmon and cod use. The top ingredients by volume were chicken and chicken products (24% of total usage), whole grains (20%), mill grains (17%), beef cattle (14%), and marine products (5%). The study examined some 600 ingredients used across dog and cat food products.

• According to a report in Pet Food Processing, a range of new tariffs by the Trump administration on imported goods from China, Canada, and Mexico are expected to raise operating costs and potentially limit growth for the pet food industry. Retaliatory tariffs imposed on the US by these countries and others will also play a role in higher costs. Canada, China, and Mexico are the biggest export markets for the pet food industry. In 2024, the US pet food industry exported $1.2 billion of US dog and cat food to Canada, $296.5 million to China, and $234.4 million to Mexico. Packaging costs for the pet industry are also expected to increase with the newly imposed metal and steel tariffs. Canada is the top steel exporter to the US, and Mexico is the third top exporter.
• Consumers may adjust their pet food budgets as consumer sentiment, an indicator of discretionary spending, continues to fall in large part due to tariff uncertainty and an expectation of higher prices, according to two major indicators. The final index of consumer sentiment from the University of Michigan dropped 8% in April 2025 from the previous month, according to CFO Dive. An index measuring consumers’ expectations for the future fell nearly a third since January, the steepest three-month percentage decline since the 1990 recession. According to survey director Joanne Hsu, “Consumers perceived risks to multiple aspects of the economy, in large part due to ongoing uncertainty around trade policy and the potential for a resurgence of inflation looming ahead.” The Consumer Confidence Index declined by 7.9 points in April 2024, compared to the previous month. Consumer confidence levels have fallen for five consecutive months, reaching levels not seen since the beginning of the COVID pandemic, according to The Conference Board, which publishes the monthly index.