Online pet food growth rebounded in July, with brand performance continuing to diverge

Overview

The report tracks China's pet food market through monthly data, covering domestic online demand, brand and channel competition, product discounts, and Douyin advertising performance, while also monitoring U.S. import demand, raw material costs, and exchange rate changes. In July 2026, online industry growth accelerated significantly versus Q2, but growth was mainly driven by Douyin and Tmall, with highly divergent brand performance. Costs declined somewhat month-on-month, and overseas orders are also recovering, but tariffs, exchange rates, and prices of some raw materials continue to pressure profitability.

Core views

At the industry level, online pet food GMV grew 12% YoY in July, accelerating from 6% in Q2. Other local brands grew 26% on average, while global brands grew 9%, indicating that both small and mid-sized local brands and multinational brands are catching up. At the company level, China Pet Food grew 22% YoY, driven by Wanpy and Zeal; Gambol grew 1%, with divergent performance among its brands; Petpal's Meatyway declined 5% YoY. The trend of concentration among leading brands on Douyin remains pronounced, with the top ten brands' July growth in the high-50% range, faster than the approximately 30% growth of the top 300 brands. Overseas, U.S. pet food imports from China continued to grow, and the cost index declined month-on-month, but RMB appreciation, tariff sharing, and elevated PET prices may suppress export business profits.

Analysis framework

The report combines data from Moojing, Chanmama, Pet Marketing, Dataweb US, Wind, Bloomberg, Datastream, and company data to compare industry and brand GMV on Tmall, Taobao, Douyin, and JD, analyze brand market share, channel structure, follower growth, sales per follower, and livestreaming versus non-livestreaming sales structure, and integrate U.S. import data, raw material prices, exchange rates, and company gross margins to assess domestic demand, competitive intensity, and overseas profitability trends.

Methodology notes

• Industry high-frequency trackingOnline GMV and brand share tracking

  Compare monthly sales growth and channel structure by platform, category, and brand

  Total online GMV mainly refers to the sum of GMV on Tmall, Taobao, and Douyin, combined with JD performance to observe channel divergence; brand data is used to evaluate growth, share, and changes in concentration.

• Operational efficiency analysisDouyin advertising and user operation tracking

  Track self-operated livestreaming, KOLs, non-livestreaming sales, follower growth, and sales per follower

  Evaluate brands' customer acquisition, traffic investment, and conversion efficiency through Douyin flagship account and sales structure data; due to changes in platform disclosure methodology, some average order values are estimated using the midpoint of price ranges.

• Profitability driver analysisOverseas demand, cost, and exchange rate tracking

  Assess changes in export profitability by combining U.S. imports, raw material prices, exchange rates, and gross margins

  The cost index covers inputs such as chicken, duck, and PET, and is combined with USD/CNY and U.S. import trends to assess the impact of orders, costs, and foreign exchange.

• Valuation methodsSum-of-the-parts valuation method

  Value domestic and overseas businesses separately, then sum and discount them

  Petpal's domestic business uses 26x 2027E P/E and is discounted at a 6.9% cost of equity, while its overseas business uses 16x 2026E P/E; Gambol's domestic business uses 25x 2027E P/E and is discounted at a 7.0% cost of equity, while its overseas business uses 10x 2026E P/E.

• Indicator evaluationRed-yellow-green signal system

  Use colors to express indicator direction

  Red, yellow, and green represent negative, neutral, and positive, respectively.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• China Pet Foods（002891.SZ）

  Core covered company, rated Neutral

  Strengths

  Domestic sales momentum is improving, Wanpy and Zeal are growing rapidly, and the company has strong global supply chain capabilities and potential to increase customer share.

  Weaknesses

  Intensifying domestic competition may pressure profitability, while overseas business also faces tariff sharing, foreign exchange losses, and raw material cost pressure.

  Comparison

  Online GMV grew 22% YoY in July, clearly outperforming Gambol and Petpal's Meatyway.

  Risks

  Competitive intensity, export tariffs, RMB appreciation, raw material prices, and changes in overseas customer demand.

• Gambol Pet Group

  Core covered company, rated Neutral

  Strengths

  Maintains a leading position in China's pet food market, Balance Nutrition achieved rapid growth, and the company has both domestic and overseas business exposure.

  Weaknesses

  Company online growth was only 1% in July, Myfoodie and Fregate declined, and competition in premium cat food is intense.

  Comparison

  Overall growth lagged China Pet Food and the average of other local brands, but Balance Nutrition performed strongly.

  Risks

  Exchange rates, freight rates, input prices, online competition, and execution of domestic brand building and channel expansion deviating from expectations.

• Petpal Pet Nutrition Technology

  Core covered company, rated Sell

  Strengths

  Recovery in U.S. import demand from China may support overseas orders, and Meatyway still achieved YoY growth on Tmall and Taobao.

  Weaknesses

  Both domestic and overseas profitability are under pressure, bargaining power is weak, and Meatyway's overall and Douyin sales declined.

  Comparison

  Compared with China Pet Food and Gambol, the report is most cautious on Petpal.

  Risks

  Changes in overseas competition, major customer orders and accounts receivable collection, domestic brand and channel execution, and changes in U.S. export tariffs.

• China pet food industry

  Industry demand and competitive environment

  Strengths

  Online GMV growth accelerated in July, Douyin and Tmall performed strongly, and U.S. import demand continued to recover.

  Weaknesses

  JD sales declined, brand performance diverged, and traffic and price competition are intense.

  Comparison

  Small and mid-sized local brands' average growth was higher than that of global brands, while leading brands on Douyin grew faster than the broader brand set.

  Risks

  Fluctuations in consumer demand, changes in platform traffic rules, declining return on advertising investment, raw material prices, and exchange rate changes.

Key data

• July online pet food GMV growthUp 12% YoYHigher than 6% YoY growth in Q2 2026.
• July platform growthDouyin +42%; Tmall +12%; JD -24%All are year-on-year changes, showing significant channel divergence.
• Average growth of other local brandsUp 26% YoYCalculated as a simple average based on online GMV.
• Average growth of global brandsUp 9% YoYOnline performance in July 2026.
• China Pet Food brand performanceCompany +22%; Wanpy +31%; Zeal +26%; Toptrees +10%All are YoY changes in online GMV in July 2026.
• Gambol brand performanceCompany +1%; Myfoodie -2%; Fregate -25%; Balance Nutrition +171%All are YoY changes in online GMV in July 2026.
• Performance of Petpal's MeatywayOverall -5%; Tmall and Taobao +19%; Douyin -21%All are year-on-year changes in July 2026.
• Douyin brand concentration trendTop ten brands' growth in the high-50% rangeFaster than the approximately 30% YoY growth of the top 300 brands.
• U.S. pet food imports in JuneTotal imports +7%; imports from China +33%Both are year-on-year changes; corresponding growth rates in May were 4% and 50%, respectively.
• July cost index for covered companiesDown 2% to 3% MoMMainly driven by declines in chicken and duck prices.
• PET price23% higher than the 2025 averageStill a source of raw material cost pressure.
• Petpal target priceRmb12.712-month target price, rated Sell.
• Gambol target priceRmb44.312-month target price, rated Neutral.

Impact & implications

The rebound in demand growth benefits companies with brand momentum and multi-platform operating capabilities, but growth concentrating on content e-commerce platforms such as Douyin will also increase pressure from traffic investment, KOL cooperation, and price competition. China Pet Foods' domestic growth and global supply chain help improve customer share, but domestic competition, overseas tariff sharing, foreign exchange losses, and raw material costs may offset revenue improvement. Gambol has a strong market position, but competition in premium cat food and valuation constrain upside. Petpal's domestic and overseas profitability is under pressure and its bargaining power is relatively weak, so the report maintains a Sell view.

Risks

• Price wars in domestic online channels and competition in premium cat food intensify further.
• RMB appreciation leads to foreign exchange losses for exporters.
• China's pet food export tariffs to the U.S. and tariff sharing compress overseas profits.
• Prices of raw materials such as PET remain above historical averages.
• Changes in overseas major customer orders or accounts receivable collection fall short of expectations.
• Brand building, channel expansion, and Douyin advertising efficiency are weaker than expected.
• Changes in platform data disclosure methodology may affect the comparability of average order value and channel metrics.

What to watch

• Whether online GMV growth in August and subsequent months can sustain July's acceleration trend.
• Changes in the concentration of the top ten brands on Douyin, the share of KOL sales, and the share of non-livestreaming sales.
• Growth and market share of China Pet Food's Wanpy, Zeal, and Toptrees.
• Whether the divergence among Gambol's Myfoodie, Fregate, and Balance Nutrition narrows.
• Whether Petpal's Meatyway can restore growth in the Douyin channel.
• U.S. pet food imports and order trends for imports from China.
• Chicken, duck, and PET prices and covered companies' cost indices.
• USD/CNY trends and exporters' foreign exchange gains and losses.
• U.S. export tariffs and tariff-sharing arrangements between companies and customers.