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April 6, 2021updated 11 May 2021 7:17pm

Nestle ups investment in pet food in China

By Dean Best

Nestlé has increased the amount of capital spending being put towards expanding its pet-food production in China.

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Last year, the Swiss giant set out plans to invest CNY600m (US$91.4m) in expanding capacity at its pet-food manufacturing site in Tianjin in the north of the country.

Nestlé has now officially launched two projects – a new line for dry pet food at its existing plant and a new factory for wet products, both on the same site – but upped its budget by another CNY230m.

A spokesperson for Nestlé’s business in China said the increase in investment would be put towards areas such as warehousing and to equipment to help reduce carbon emissions at the site. Part of the new tranche of spending will also go towards buying land for the wet pet-food factory and a “refinement in project-related cost and design”, the spokesperson added.

Nestlé is aiming for the new production line for dry pet food to begin output by the end of this year, while the new plant to make wet products is scheduled to start operations in the first quarter of 2023.

In a statement, the company said the investment would "strengthen Nestlé's leading position in China's domestic pet food industry".

Mirand Chan, the head of Nestlé's Purina PetCare business in Greater China, added: "Having been active in the Chinese market since 2001, our pet-food business receives major support from Nestlé, with a recent focus on facilitating the continued upgrading of consumption in the sector. The market has shown increasingly strong demand for high-quality pet food in terms of raw materials, nutrition and taste. Our new investments will help to deliver the best products to our consumers."

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Free Report
img

What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
Enter your details here to receive your free Report.

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