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Pet Care in Argentina

Argentina pet care under no threat despite struggling economy

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2014-03-24 12:32:03 - Pet Care in Argentina - a new market research report on

The Argentinian economy struggled in 2012. GDP grew by only 2% while investment fell by 7%. Despite these figures, the pet care industry faced no major threats. In 2012, there was strong investment from companies to expand their production capacities due to large growth in demand. Among the major companies that invested, the multinationals Nestlé Argentina and Royal Canin Argentina stood out, while among domestic firms, Grupo Pilar and ACA Asociación de Cooperativas Argentinas featured.

Since 2007, Argentina has been among the countries with the highest inflation rate in the world. The government has not seriously tackled the country´s economic difficulties and implements price control policies that do not solve its structural problems. In 2012, the government set maximum annual increases



based on categories that were classified as popular, intermediate and premium. Popular brands have a maximum price increase per year set well below those within the intermediate and premium categories. Consequently, various brands are sold with a very low profit margin and this generates an extensive distortion in the relative prices of products.

The remarkable dynamism of the pet care industry in Argentina attracted many investors. Given a demand that seems to be only limited by supply, several national companies decided to venture into the pet food industry. Therefore, during the review period, many domestically-financed companies began to participate in pet care at the expense of multinational companies. Among the most important new companies that stand out are Petfood Saladillo, which was founded in 2010 and based at a former Nestlé Argentina plant. While domestic companies in 2003 represented only a 21% value share of pet care, in 2012, this figure increased to 31%.

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