Moutai enters the pet industry: multiple giants cross-industry layout of "It Economy"

□ Our Reporter Wang Qichen

In March, a report that Kweichow Moutai is moving into insect-protein pet food drew widespread market attention. Compared with earlier, more sporadic attempts by individual brands, this move looks more like a signal. As companies from multiple sectors—including liquor, dairy, snacks, and meat—continue to enter, the pet food track is shifting from a “new consumption boom” toward a more complex round of industrial competition.

In recent years, China’s pet economy has kept growing. The 2026 China Pet Industry White Paper (Consumption Report) shows that by 2028, the market size is expected to exceed 405 billion yuan, and the full pet industry value chain is accelerating into shape. The reporter noted that, unlike traditional pet brands that have long focused deeply on the business, most of the new entrants in this wave arrive with resources from their existing industry chains. Some extend through brand and channel resources, showing a diversified and differentiated competitive path.

Differentiated paths competing for the pet food track

“My dog might taste ‘Moutai’ before I do.” Wang, who has kept pets for five years, said with a laugh. This quip quickly spread across social media platforms, reflecting the market’s attention to traditional companies crossing over into the pet track. As pet-keeping concepts shift from “care” to “companionship,” pets are increasingly seen as family members, and pet food has become one of the core product categories with the highest share of spending.

Qichacha data shows that as of March 19, there were 4.8606 million pet food–related companies in China. More than 70% of the companies were established within the past three years. East China, South China, and Central China together account for nearly 80%, but more than 80% of companies only involve wholesale and retail, and the proportion of companies with R&D and production capabilities is limited.

Against this backdrop, the entry paths of different companies also show differences. Taking Kweichow Moutai as an example, it is mainly developing the pet food sector through “resource reuse.” In mid-March, its subsidiary disclosed to the public that it is turning brewing byproducts into protein ingredients by raising black soldier flies on spent grain, and it is also attempting to extend into the pet food domain. Based on publicly available data, the project processes about 5 tons of spent grain per day, which can be converted into nearly 1 ton of fresh insects, while also producing organic fertilizer raw materials. Xie Jun, chairman of Moutai’s cyclical production and investment company, said the project is both an attempt to cultivate new business for the company and aligned with the direction of the circular economy.

By contrast, Three Squirrels focuses on channels and pricing, quickly expanding the market through sub-brands; while companies such as WH Group Development and Wen’s Co., Ltd. rely on upstream meat resources, emphasizing fresh meat and freeze-dried products and highlighting the raw materials themselves.

In response, marketing expert Wu Zewei pointed out that dairy and leisure food companies enter the pet food sector by leveraging their existing supply chains, channel networks, and brand accumulation, giving them a natural foundation for industrial extension. But he also stressed: “If you rely only on OEM labeling or concept packaging, it may be hard to form long-term competitiveness in the pet-food market. Only by deeply cultivating your own supply chain and R&D system can you build a stable business base.”

Rational choices remain the mainstream

The reporter found that consumers hold different views on the appearance of cross-border pet staples. Some younger pet owners are more willing to try big brands such as Kweichow Moutai and Yili Co., Ltd., “at least I feel more trust in terms of quality.” However, some consumers are cautious: “No matter how big the brand is, in the end it comes down to whether the pet actually eats it and whether there are any adverse reactions. People won’t keep buying just because of fame.”

“I’m used to my cat eating the same brand and I don’t dare to switch easily.” Wang, a consumer who has kept pets for five years, told the reporter that after seeing Moutai enter the market, he found it “quite fresh,” but he is still more of an observer. Regarding insect-protein pet food, several interviewees mentioned that there is both “curiosity and concerns.” Some pet owners said: “Eco-friendly and high-protein—these points do attract people, but psychologically there’s a hurdle, so I don’t dare to feed it directly as the main staple.” Others choose a more cautious approach: “You can buy a small package to try, and then decide whether you want to use it long-term.”

Some consumers, meanwhile, are more open-minded. A young user who follows sustainable consumption told the reporter that if the product ingredients are safe and nutrition is balanced, “actually I’m not opposed—after all, people’s food is also talking about alternative proteins now.” But at the same time, they emphasized, “The prerequisite is still to look at testing and real feedback.”

By contrast, the price factor has a more direct influence on consumption decisions. Multiple interviewees said pet staple food is a long-term expense, and “if the price is too high, it’s hard to sustain over the long run.” One cat owner said, “I’ll still prioritize value for money.”

The industry upgrading toward greater refinement and quality

With multiple traditional companies entering in a concentrated manner, attention on the pet food track has risen rapidly. However, people in the industry point out that there is still a clear “heat-first” characteristic.

On the one hand, emerging brands continue to pour in, and local companies are also accelerating their layout. On the other hand, cross-border players from areas such as liquor, dairy, snacks, and agriculture and animal husbandry have clustered into the market, pushing the industry from early, scattered competition toward a situation involving games among multiple parties. In this process, the pet food market is evolving from “wild growth” to a “fine-grained competitive” stage that places greater emphasis on supply chains, products, and brands.

Wang Peng, deputy researcher at the Beijing Academy of Social Sciences, said that this round of cross-border entry has indeed raised industry buzz, but from the capability side, many companies are still “catching up.” He said: “New entrants bring capital, brand, and supply-chain resources, but in core capabilities such as pet nutrition systems and formulation R&D, it’s still difficult to form obvious differentiation in the short term. Many products still remain at the OEM stage or the concept-packaging stage.”

Wu Zewei believes that high-end functional pet food is currently the direction with the strongest explosive potential. As pet-keeping knowledge spreads, staple food has upgraded from “feeding well enough” to “feeding better.” Demand for high-protein, low-allergen, and naturally functional pet food is growing rapidly. At the same time, emotional companionship services for pets—such as AI robots and customized funeral services—are also rising quickly, meeting owners’ deeper needs at the level of the human spirit.

Experts say that as pet-keeping concepts keep spreading, industry standards continue to improve, and corporate innovation keeps making efforts, the pet economy will continue to grow steadily, showing the long-term potential of “pet economy.” Wang Peng believes that in the future, the industry’s core competitiveness will return to R&D capability and professional expertise in pet nutrition.

“Brands and channels certainly determine whether a company can survive, but it is R&D depth that determines the ceiling of product quality and the thickness of professional trust.” Wang Peng believes that in the future, the survival space for small and mid-sized brands will mainly be concentrated in highly segmented markets—for example, prescription foods or functional sub-products targeting elderly pets and allergy-prone pets—as well as localized innovation services that deeply cultivate specific communities and provide region-specific or distinctive ingredient solutions. These are localized advantages that big players find hard to cover.