The US agribusiness group, which has been present in the Mexican market for 65 years, said that by adding this new line, it will increase its manufacturing workforce by 65% and optimize dry pet food production flow.
Jorge Martínez, president, ADM Pet Nutrition, told us the company’s existing pet food facility in Guadalajara already had two production lines in operation, serving a wide range of products for distribution throughout Mexico. “With this new line, the plant will expand its capacity to reach foreign markets, specifically Central America and Colombia.”
In addition, the flexibility offered by the new line means ADM can manufacture practically its entire range of pet food products, including some of its premium dog and cat brands.
And tonnage output at the Jalisco plant is set to double, said Martínez.
"The facility will also be equipped with new technology such as automated systems to avoid the use of forklifts and manual hauling, and work practices are aligned with NOM-036, which is a Mexican regulation on ergonomic risk factors at work.
"In terms of corporate social responsibility, the new production line will reuse water through a new treatment plant."
Jalisco, noted the US firm, is one of three main states in Mexico deemed to be a growing and attractive location for qualified talent and investments. “Without a doubt Guadalajara is a strategic, economic location for ADM in Mexico."
The Mexican pet food market is forecast to expand in volume by 4% and in value by 8% over the next five years, with ADM’s business anticipated to grow above those ranges, he added.
Premiumization and pet humanization trends in Latin America
Pet care growth rates spiked during the pandemic in Latin America, helped by consumers adopting pets for company during lockdowns as well as the ongoing premiumization and pet humanization trends, found an August 2023 report from Euromonitor.
“In spite of high inflation rates in the region, growth has remained strong post-pandemic, albeit slightly down on the 2020-2021 period.”
While dog food still dominates, cat food is seeing stronger growth. “The sales increases in pet products have come down from their highs during COVID-19 home seclusion periods, when owners were spending more time with their pets, increasing their tendency to pamper them.”
Preventive pet health is becoming increasingly important in the pet care industry. With Brazilian households now having more pets than children, many owners of pets see them as family members. “This is helping drive the adoption of natural food for pets, although natural feeding is not possible for everyone because of its high costs. In fact, economy and mid-priced dry products still dominate overall dog and cat food sales,” reads the Euromonitor report.
E-commerce gains
E-commerce continues to gain share, but will only reach 8% of sales in 2023, according to the publication.
“Small local grocers remain a key channel in many countries in Latin America, although pet shops and superstores lead regionally due to their dominance in Brazil, the biggest market. Veterinary clinics are a key distribution channel in Argentina, accounting for almost half of other pet food sales.”
Dog and cat populations are expected to continue growing in Latin America, with prepared sales also likely to take further share from non-prepared over the forecast period. “Although the economic backdrop is currently troubled in much of the region, pet care sales are expected to continue growing. The premiumization and humanization trends will help growth in real value terms to outstrip the volume performance.”
