The development status and future strategy of China's pet industry from a global perspective

summary

In the context of the vigorous development of the global economy and the continuous upgrading of consumption patterns, the pet industry has ushered in significant growth in recent years, especially in China, Europe and the United States, pet food, services and other related fields have shown vigorous development vitality. With the continuous expansion of the domestic market and the huge potential of the export market, China's pet industry is gradually becoming the core position of the global pet food industry. However, the development of the industry is not all smooth sailing, it is facing both the slowdown in domestic market demand growth, the internal challenges of increasing competition, but also the impact of external economic factors such as tariff policy adjustments in the international market, exchange rate changes and technical trade barriers. Therefore, a comprehensive analysis of the development status of the industry, exploring its influencing factors and predicting future trends, and using mathematical models for quantitative analysis have become the key means to deal with the current challenges. In view of this, this paper designs a series of in-depth analysis methods and countermeasures around the Chinese pet industry and its performance in the international market.

In response to question 1: Based on the statistical data of China's pet industry in the past five years and other relevant data, this paper analyzes the trend of the number of pet cats and dogs, and highlights the critical period and influencing factors of the development of the industry. Using random forest and multiple regression models, this study evaluates the impact of economic conditions, policy environment, and consumer habits on the growth of the pet industry, and uses a trend prediction model to estimate the changes in the number of pets in the next three years. The results of the study will help domestic enterprises to make strategic decisions on market positioning and resource allocation.

In response to question 2: This study combines additional data and global market analysis to provide a regional analysis of the growth pattern of the pet industry in the European and American markets. By constructing a regional demand model, this paper reveals the proportion of demand for pet cats and dogs in different markets and their growth potential, and predicts the global pet food demand trend over the next three years. The study also discusses the competitive advantages of Chinese pet food in the international market, and proposes market expansion strategies including product premiumization, regional branding, and supply chain optimization.

In response to question 3: Based on the production and export data of China's pet food industry, this paper analyzes the internal growth and external performance of the industry, and uses regression and demand-supply models to explore the key drivers. In the context of global demand growth, the production and export scale of the industry in the next three years are predicted, and the dual impact of consumption upgrading and export market structure optimization is considered. In addition, this study provides a decision-making basis for enterprises to formulate medium- and long-term strategies, involving market layout optimization, international market penetration and technological innovation.

In response to question 4: In view of the new tariff policies and technical barriers in Europe and the United States, this paper establishes a multiple regression model based on export data, and analyzes the impact of tariff level, exchange rate fluctuations and global demand growth on the total export value. Based on the model results, the strategies of optimizing market layout, increasing product added value, developing sustainable products and enhancing competitiveness through technological innovation are proposed, aiming to support the stable development of China's pet food industry in a complex international environment.

Through data analysis and mathematical modeling, this paper comprehensively analyzes the development status and future trends of China's pet industry and pet food industry. In view of the challenges and opportunities of domestic and foreign markets, a series of scientific and feasible forecasts and strategies are proposed, which provide strong decision-making support for industry participants.

Keywords: pet industry; time series analysis; multiple regression model; demand-supply equilibrium model; Random forest regression

directory

Introduction 1

1.1Background 1

1.2Problem Restatement 1

2. Model Assumptions2

3. Notations2

4. Problem analysis3

4.1 Analysis of Problem 1 3

4.2 Analysis of Problem 2 3

4.3 Analysis of Problem 3 3

4.4 Analysis of Problem 4 3

5. How is the development of China's pet industry?4

5.1 Model selection and establishment 4

5.2 Data Visualization & Pet Industry Analytics 5

5.3 Pet Industry Development Factors and Future Forecast Analysis 9

5.4 Pet Industry Market Analysis and Drivers 10

6. What about the development of the global pet industry?11

6.1 Data preprocessing and modeling 11

6.2 Visualization and preliminary judgment of global pet data development 13

6.3 Analysis and forecast of the development of the global pet food industry 14

6.4 Forecasts of food demand and market conditions over the next three years 16

7. What is the development status of China's pet food industry?17

7.1 Data processing and modeling 17

7.2 Data Visualization & Food Industry Analytics 19

7.3 Predictive model presentation and future predictive analysis 21

8. How should China's pet industry respond to the challenges and continue to grow sustainably?22

8.1 Data processing and modeling 22

8.2 Data visualization and impact analysis 23

8.3 Actionable coping strategies 25

8.4 Strategic implications at different levels 26

9. Evaluation of the model26

9.1 Advantages of the model 26

9.2 Disadvantages of modeling 27

10. Improvement and generalization of the model27

10.1 Improvements of the model 27

10.2 Generalization of the model 28

11. References28

1. Introduction

1.1 Background

In recent years, China's pet industry has shown a booming trend, which is due to many factors. The rapid development of the economy has provided a solid material foundation for the prosperity of the pet industry. With the continuous growth of China's economy, the income level of residents continues to increase, the consumption concept gradually changes, and the demand for pets is also increasing. Pets have become not only animals in the care of homes, but also important companions and family members in people's lives, which has promoted the rapid development of the pet industry.

The support of government policies also provides a good external environment for the development of the pet industry. The government has strengthened the supervision of the pet industry, standardized the market order, and protected the legitimate rights and interests of consumers. At the same time, the government has also introduced a series of policies to encourage the development of the pet industry, such as providing financial support, tax reductions and exemptions, etc., creating favorable conditions for the development of the pet industry.

The diversification of consumer demand has also promoted the rapid development of the pet industry. People not only pay attention to the health and diet of pets, but also pay attention to the needs of pets in terms of grooming, medical treatment, entertainment, etc. This has promoted the segmentation and professional development of the pet market, providing more market opportunities for pet companies.

Driven by the above factors, China's pet industry has developed rapidly. In the next few years, with the acceleration of urbanization and the increase in the number of people living alone, the demand for the pet market will continue to grow, and the pet industry will usher in a broader space for development.

The vigorous development of China's pet industry is not only reflected in the rapid growth of the number of pets, but also in the increasingly perfect pet economic industry chain and pet owners attach great importance to the health and quality of life of pets.

In terms of the size of the pet market, the size of China's pet market is expanding year by year. With the rapid development of the economy and the improvement of people's living standards, more and more families have begun to raise pets and regard pets as family members. According to relevant statistics, the scale of China's pet market has maintained rapid growth for many years, and the growth rate far exceeds that of other countries. This is mainly due to the huge potential of the pet market and the diversified needs of pet owners for pet health, grooming, food, etc.

In terms of the growth trend of the pet market, several distinct features can be observed. Diverse pet breeds. In the past, pets were mainly traditional pets such as cats and dogs, but nowadays, pets such as fish, birds, and reptiles are gradually gaining popularity. This change not only enriches the breed of the pet market, but also provides pet owners with more choices. There is an increasing demand for pet medical and grooming services. As pet owners become more concerned about the health and appearance of their pets, pet medical and grooming services are gradually becoming a hot area in the pet market. Many professional pet hospitals and grooming salons have emerged to provide comprehensive health care and grooming services for pets. The pet products market is also showing a rapid growth trend. The acceleration of the replacement of pet food, toys, clothing and other supplies has brought huge business opportunities to the pet products market.

Looking ahead, China's pet industry will continue to grow. With the increasing number of pets and the increasing demand of pet owners for pet health and grooming, the pet market will usher in more development opportunities. At the same time, with the gradual standardization of the pet industry and the intensification of market competition, pet companies need to continuously improve their own strength and service level to meet the needs of consumers.

12 Restatement of the Question

Question 1: Based on the data in Attachment 1 and additional data collected by your team, please analyze the development of China's pet industry by pet type over the past five years. It also analyzes the influencing factors of the development of China's pet industry, so as to establish a suitable mathematical model to predict the development of China's pet industry in the next three years.

Question 2: In recent years, the pet industry in European countries and the United States and other overseas countries has also developed rapidly. Analyze the development of the global pet industry by pet type based on the data in Appendix 2 and additional data collected by your team. and build a suitable mathematical model to predict the global demand for pet food over the next three years.

Question 3: Based on the data on China's pet food production and export in Annex 3, analyze the development of China's pet food industry, and forecast China's pet food production and export in the next three years (regardless of changes in economic policies), combined with the demand trend of the global pet food market and the development of China.

Question 4: China's pet food industry will inevitably be affected by new external economic policies (such as tariffs) introduced by European countries and the United States. To quantify this effect, build a suitable mathematical model and take into account the data in the attachment, the additional data you collect, and the calculations in the questions above. Based on your calculations, develop a viable strategy for the sustainable development of China's pet food industry.

2. Model assumptions

Linear impact of tariff policy: The impact of tariffs on the total value of exports is assumed to be linearly decreasing, without taking into account nonlinear or threshold effects.

Simplified analysis of policy impacts.

Special market behavior under high tariffs may be overlooked.

 Steady growth in global market demand: It is assumed that the global pet food market will maintain stable growth over the next three years, without taking into account sudden economic crises or reversals in consumer trends.

Improve the controllability of model predictions.

Ignoring the possible impact of global market volatility.

 Controllable exchange rate fluctuations: Assuming that the fluctuation range of the RMB exchange rate against the US dollar is within a controllable range, there will be no impact on export prices due to drastic changes.

Good for model stability.

The possibility of abnormal fluctuations in the exchange rate is ignored.

 Balanced distribution of export market demand: It is assumed that the demand for Chinese pet food in the international market is evenly distributed, without taking into account the surge or contraction of demand in specific countries.

It is convenient for overall trend forecasting.

It may mask special changes in local markets

3. Description of symbols

Fourth, problem analysis

4.1 Analysis of Problem 1

In recent years, China's pet market has shown a significant expansion trend, especially in the two pet categories, cats and dogs. By looking at the growth in the number of cats and dogs over the last five years, we can paint a picture of the development contours and characteristics of the industry. Among them, the rapid growth of pet cats reflects that with the acceleration of urbanization, people's demand for pets is also rising; At the same time, the number of pet dogs is growing at a slower rate, which may be related to changes in housing conditions, relevant policies and pet keeping habits. In addition, with the growth of the economy, the spread of pet culture, and the rapid development of the pet medical and food industries, the prospects of China's pet industry have been positively affected in many ways. By applying appropriate mathematical models, such as time series analysis or regression analysis, it is possible to predict future trends in pet populations and thus provide data support for strategic decision-making by companies in the industry.

4.2 Analysis of Problem 2

In recent years, the pet industry has experienced rapid expansion in international markets such as Europe and the United States, especially in the continuous rise in the number of pet cats and dogs, and the extensive growth of the pet food and service market. As the center of gravity of the global pet industry, the market growth of the United States and Europe is influenced by factors such as rising per capita income, changes in pet ownership concepts, and advances in pet medical technology. By analysing additional data and additional information about the global market, we can observe the unique characteristics of the development of the pet industry in different countries and regions. For example, the U.S. market tends to develop high-end and functional pet food, while Europe shows a more balanced growth model. Using data trends and established mathematical models, such as multiple regression analysis or regional forecasting models, it is possible to predict the changes in global demand for pet food in the next three years, which provides key data support for Chinese companies to formulate export strategies.

4.3 Analysis of Problem 3

The rapid development of China's pet food industry has benefited not only from the expansion of domestic market demand, but also from the continuous growth of overseas market demand. By studying the production and export data of China's pet food in the past five years, it is possible to gain a deeper understanding of the competitiveness of the industry in the domestic and foreign markets. In China, the growth of the market is mainly driven by consumption upgrades; At the international level, the industry has to deal with challenges such as tariffs, exchange rate fluctuations and global competition. In the next three years, with the increase in global demand for pet food, China's export market will face new opportunities and challenges. By building mathematical models, such as time series analysis or demand-supply models, combined with data on global market trends and domestic capacity expansion, an effective set of medium- and long-term strategic planning for China's pet food industry can be developed.

4.4 Analysis of Problem 4

The competitiveness of China's pet food industry in the international market is significantly affected by external economic policies, including tariffs, trade barriers and exchange rate fluctuations. For example, increased tariffs in the US-China trade dispute have had a direct impact on Chinese pet food exports, while Europe's high standards for environmental protection and product quality have also imposed stricter requirements on Chinese producers. In order to gain a better understanding of the specific impact of these external factors on total exports, multiple regression models or scenario analysis can be used to simulate export dynamics in different policy contexts. Through this simulation, the impact of policy changes on exports can be quantitatively analyzed, and strategies can be developed accordingly. Strategies such as optimizing the supply chain, increasing product added value, and exploring emerging markets will support the sustainable development and international competitiveness of China's pet food industry by combining global market demand and China's competitive advantages.

5. Establishment and solution of the model of problem 1

5.1 Model selection and establishment

5.1.1 Time series analysis of the development of the pet industry

Data at a glance

Method:

Calculate the fundamental statistics (mean, variance, maximum, and minimum).

Use trend charts to show changes in the number of pet cats and dogs.

Compare the growth rate of the number of pet cats and dogs.

Formula:

Average Formula:

Variance Formula:

Trend analysis

Methods: The growth rate of the number of pet cats and dogs per year was calculated and their differences were compared.

Formula: Growth Rate Formula:

where the data for year t is described.

5.1.2 Causality exploration engine for the pet industry

Related Variable Filtering:

The Pearson correlation coefficient formula was used to evaluate the linear correlation between the number of pet cats and dogs and other variables (such as pet food market size, e-commerce transaction volume, etc.), and the key variables with high correlation with the target variables were screened out. The formula is:

​

Data Visualization:

Draw a correlation heat map to visualize the strong correlation between variables.

Focus on highly correlated variables to provide important input features to the model.

Multidimensional Impact Analysis:

Highly correlated variables are used as the basis of causal analysis to explore potential causal relationships between variables.

5.1.3 Panoramic intelligent prediction system for the future pet industry

Feature Engineering Optimization:

Select feature variables with high relevance (such as pet food market size, e-commerce transaction value, etc.) as model inputs.

Use the year to generate polynomial features to improve the model's ability to capture nonlinear trends:

Build a predictive model:

Polynomial regression model: suitable for scenarios with small samples and smooth trends, formula:

Random Forest Regression Model: Captures complex nonlinear relationships using multi-tree ensembles, formula:

Model Evaluation:

The predictive performance of the model is measured using the coefficient of determination and MAE

Predicting future trends:

The 2024-2026 years and associated factors were fed into the model to generate future predictions of the number of pet cats and dogs.

5.2 Data visualization and pet industry analysis

5.2.1 Analysis of the development trend of the pet industry in time series

The chart depicts the annual trend of the number of pet cats and dogs in China from 2019 to 2023, with the blue line representing pet cats and the orange line representing pet dogs. By observing the chart, we can clearly find that the number of pet cats continues to rise, showing a steady growth trend; In contrast, the number of pet dogs has experienced small fluctuations, with an overall trend of more stable and even a slight decline in some years. The different trends in the number of pets in these two groups highlight the significant changes and differences that have taken place in the pet industry in recent years.

(1) Analysis of the growth of the number of pet cats

In the time span from 2019 to 2023, the number of pet cats has achieved a significant increase from 44.12 million to 69.8 million, an increase of about 56%. This trend shows that pet cats are becoming more and more popular in China. From the relevant data charts, it can be observed that the growth of the number of pet cats shows an accelerating trend. This phenomenon can be closely related to several factors, including but not limited to:

Urbanization and work pressure: There are more urban residents, there is limited space for pets, and pet cats are more suitable for urban living environments than pet dogs. And pet cats consume only one-third of the owner's energy of pet dogs, pet cats are independent, easier to take care of, and are more loved by most busy people.

Changes in pet culture: With the development of short videos and social networks in recent years, people's pet culture has been changing, and the cute and petite image of pet cats is more loved by people, and cat culture has gradually become popular.

Loneliness caused by the pandemic: During the pandemic, people stayed at home, and the long-term closed environment made people feel lonely, so they needed pets more to accompany them, which is why 2020 was the year with the largest growth in the number of pet cats.

(2) Analysis of the fluctuation of the number of pet dogs

In contrast to the rapid growth in the number of pet cats, the number of pet dogs has changed relatively steadily, gradually decreasing from 55.03 million in 2019 to 51.75 million in 2023, with an overall decrease of about 6%. By looking at the chart, we can find:

Slight rebound in 2020: The slight rebound in the number of pet dogs this year is related to the increased demand for companionship during the pandemic.

Overall downward trend: The number of pet dogs gradually decreases and stabilizes in other years, which may be related to the following factors:

Policy restrictions: Dog breeding policies in some cities, such as large dog bans and leashes, may have inhibited the growth of pet dogs.

The cost of raising a dog is higher: Pet dogs need more outdoor activities and training, and the cost of raising and the investment of time and energy are higher, which may discourage some consumers.

(3) The intersection of pet cats and dogs

The year 2020 was an important turning point, with the number of pet cats and pet dogs crossing over the year. Since 2020, the number of pet cats has surpassed that of pet dogs, becoming the dominant pet market in China. This phenomenon reflects a significant shift in consumer preferences and may be driven by:

Economic development: With the development of the domestic economy, more consumers are willing to invest more in their favorite pets (such as pet cats).

2. Changes in pet culture: With the development of short videos and social networks in recent years, people's pet culture has been changing, and the cute and petite image of pet cats is more loved by people, and cat culture has gradually become popular.

3. Impact of the epidemic policy: Since pet dogs need to go out for outdoor activities and training every day and cannot stay at home all the time, the lockdown policy of the epidemic has caused pet dog owners to be unable to walk their dogs as before. However, pet cats are different from dogs, pet cats do not need to go out and can stay at home all the time.

(4) Industry opportunities and challenges

This trend has had a profound impact on several segments of the pet industry:

Expansion of the pet cat-related market:

The pet cat market is ushering in a golden period of development, from cat food and cat litter to healthcare and toys.

Young consumers have become the main group, and they have a strong demand for personalized products related to pet cats.

Transformation of the pet dog market:

Despite the decline in the number of pet dogs, there are still a large number of consumer groups in the market, and the industry needs more refined services (such as personalized health management and disease prevention).

By exploring lower-cost, more cost-effective solutions, such as shared dog walking services, you can attract new consumer groups.

(5) Forecasting and future prospects

If the current trend continues, the market share of pet cats is likely to continue to expand in the coming years, while the market size of pet dogs is likely to remain stable or shrink slightly. However, it is worth noting that the development potential of the pet industry is far more than the increase or decrease in quantity, and the increase in per capita consumption expenditure is equally important. Segments such as pet food, healthcare, and entertainment services are expected to be the main drivers of progress across the industry. For enterprises, accurately capturing the changes in consumer preferences and optimizing marketing strategies accordingly will be the key to winning market opportunities.

5.2.2 Pet industry causality exploration engine

The above heat map visualizes the correlation matrix of the relevant data of the pet industry, in which the color shade and specific values reflect the closeness of the correlation between the variables. The closer the color is to deep red, the stronger the positive correlation; Conversely, the closer the color is to dark blue, the more significant the negative correlation is. White or light areas indicate a lack of significant correlation between variables. From this chart, we can observe that most of the variables show a strong positive correlation with each other, and there are also some obvious negative correlations. This finding provides a valuable quantitative reference for an in-depth analysis of the core drivers of growth in the pet industry.

(1) Correlation analysis of the number of pet cats and dogs

Number of pet cats:

The number of pet cats had a strong correlation with multiple variables, especially with "year" (r=0.99), "pet consumption expenditure per capita" (r=0.99) and "pet food market size" (r=0.99). This shows that the demand for pet cats continues to grow over time, and this growth is closely related to the increase in consumption levels and market expansion.

There is a moderate negative correlation with the "number of pet dogs" (r=−0.68), which may reflect a gradual shift in consumer preference from pet dogs to pet cats.

Number of pet dogs:

The number of pet dogs was negatively correlated with most variables, such as "year" (r=−0.72), "pet insurance coverage" (r=−0.74), and "pet consumption expenditure per capita" (r=−0.72). This suggests that although the overall pet industry is expanding, the market share of pet dogs may be gradually shrinking.

(2) Analysis of industry consumption-related variables

Pet Food Market Size:

This variable has a very high positive correlation with several core indicators (such as the number of pet cats and per capita pet consumption expenditure) (r=0.99), indicating that the expansion of the pet food market is one of the key factors driving the development of the pet industry.

There is a strong negative correlation with the number of pet dogs (r=−0.72), which may be because the rapid growth of the pet cat market is diverting the consumption resources of the pet dog market.

Per capita pet spending on pets:

The strong correlation with "number of pet cats" (r=0.99) and "pet food market size" (r=0.99) reflects that the increase in consumer spending on pets is directly driving the expansion of the industry.

This variable is also an important indicator to measure consumption upgrading. With the increase of per capita disposable income, consumers' requirements for the quality of life of pets have increased, driving related consumption.

(3) Analysis of industry development driving variables

Number of new pet-related business registrations:

This variable is highly positively correlated with the variables of "pet food market size" (r=0.97), "pet consumption expenditure per capita" (r=0.97) and "number of pet cats" (r=0.97), indicating that the registration of new enterprises is an important driving force for the growth of the industry.

There is a certain negative correlation with the number of pet dogs (r=−0.66), which may reflect that new companies are more inclined to develop products and services related to pet cats rather than the pet dog market.

Pet e-commerce transaction value:

This variable is highly correlated with almost all core variables, especially the "number of pet cats" (r=0.98) and the "pet food market size" (r=0.99), indicating that e-commerce platforms play a key role in pet consumption. The growth of pet e-commerce transactions has not only made it convenient for consumers to purchase pet products, but also greatly promoted the expansion of the market.

and (4) the interpretation of negative correlation

Negative correlation with the number of pet dogs:

The negative correlation between the number of pet dogs and most industry indicators (e.g., "vintage" and "pet food market size") suggests that the pet dog market may be affected despite the expansion of the pet industry as a whole.

This phenomenon may be due to the following points:

Increasing urbanization is limiting the space for dog ownership.

Policy restrictions (e.g., prohibited breeds and large dogs).

Consumer preferences have shifted in favor of easy-care pet cats.

Negative correlation with pet insurance popularity:

There is a strong negative correlation between the penetration rate of pet insurance and the number of pet dogs (r=−0.74), which may be because the growth of pet insurance is more related to the high-end consumer market, while the consumer group of the pet dog market may be more fragmented or more traditional.

5.3. Development factors and future forecast analysis of the pet industry

5.3.1 Industry development factors

The main drivers of the industry's development

According to the comprehensive analysis, the main drivers of the development of the pet industry include:

Time (year): The year is positively correlated with most variables, indicating that the passage of time has driven the overall growth of the pet industry.

Consumption upgrading: The growth of indicators such as per capita pet consumption expenditure and pet food market size has directly promoted the development of the industry.

The rise of e-commerce platforms: E-commerce transactions have become the main channel for the circulation of pet products, which has played a vital role in the expansion of the industry.

Increase in Industry Players: The number of new pet-related businesses registered has increased significantly, injecting more competition and dynamism into the market.

5.3.2 Panoramic intelligent prediction system for the future pet industry

This chart depicts the historical record of the number of pet cats and dogs between 2019 and 2026 and the forecast for the next three years based on a polynomial regression model. As can be seen from the chart, the number of pet cats continues to rise, and the forecast results show that its growth momentum will accelerate further in the next three years; In contrast, the number of pet dogs has remained stable overall, with forecasts consistent with past trends and limited volatility expected over the next three years. This trend indicates that the pet cat market will continue to be the main engine driving the growth of the pet industry in the near future, while the pet dog market may face the challenge of stability or even potential contraction.

54 Pet Industry Market Analysis and Driving Factors

First, the overall trend analysis

By analyzing the changes in the number of pet cats and pet dogs from 2019 to 2026, it is clear that the pet industry is significantly dynamic in the Chinese market. The number of pet cats continues to grow and accelerate, reflecting the rising consumer demand for pet cats. At the same time, the number of pet dogs is gradually stabilizing, and forecasts show that the market growth in the next three years is limited and may face a certain saturation. This change directly reveals the shift in the center of gravity within the pet industry and the profound change in consumer demand.

Second, the differentiated development of the pet cat and dog market

The continued expansion of the pet cat market:

The number of pet cats has grown rapidly from 44.12 million in 2019 to 69.8 million in 2023 and is expected to exceed 8,500 in 2026Ten thousand. This rapid growth trend not only reflects the change in consumer preferences, but also shows that the pet cat-related industry is becoming an important driving force for the development of the pet industry.

At the market level, the expansion of the pet cat market provides huge room for growth in high value-added areas such as pet insurance, medical services, and smart products. With the increase in consumers' investment in pet cats, the competition between enterprises in service quality, product innovation and customer experience will become more and more fierce in the future.

Stagnation and Transformation of the Pet Dog Market:

Compared with the rapid expansion of the pet cat market, which may be affected by factors such as the policy environment, high costs and changing consumer preferences, the number of pet dogs has increased from 5,503 in 201910,000 fell to 51.75 million in 2023 and remains stable at around 52 million in future forecasts.

Although the growth of the pet dog market is limited, its stock market is still huge. In the future, enterprises can improve consumer stickiness through differentiated services (such as high-end dog food, behavior training courses, etc.) and further tap market potential.

Third, the driving factors of the development of the industry

Through the multivariate correlation analysis of the pet industry, the main driving factors affecting the development of the industry include time, consumption upgrading, market participation and technological innovation.

Time Factor:

The number of pet cats is highly positively correlated with the time variable, indicating that the pet industry is gradually tilting towards the pet cat market over time.

Economic Development:

"Per capita pet consumption expenditure" is an important factor affecting the number of pets, especially for the pet cat market. This shows that consumers are willing to pay more to improve the quality of life of their pets, which has led to the growth of the industry as a whole.

Market Engagement:

The number of newly registered pet-related companies is highly positively correlated with the market size, indicating that the increase in market participants has injected more vitality and competitiveness into the industry.

The increase in pet e-commerce transactions also reflects the diversification and convenience of consumer purchase channels, which provides solid support for the expansion of the industry.

Scientific and technological innovation:

Scientific and technological innovation is the primary productive force, with the rise of intelligent products, such as pet monitoring equipment, intelligent cat litter box, etc., technological innovation provides a new growth point for the development of the pet industry. Especially in the pet cat market, technological innovation not only reduces the difficulty of raising pets, but also improves the experience of consumers.

6. Establishment and solution of the model of problem 2

6.1 Data preprocessing and model establishment

6.1.1 Data integration of the global pet industry

Directly embed Annex 2 data:

Annex 2 contains historical population data for pet cats and dogs in the United States, France, and Germany, as well as worldwide. Embed the data directly into the code to ensure that it can be called directly in subsequent steps.

Data format: country, year, pet type, number (unit: 10,000).

Read the supplementary data file:

The supplementary data document "Question 2 Data Collection .xlsx" includes the global pet food market size, pet medical services market size, pet supplies and care consumer market size, and the growth rate over the next three years.

Data structure: country, year, data type, market size (unit: USD billion), growth rate (unit: %).

Data Cleansing & Integration:

Check for missing values to ensure data integrity.

Add the empty column "Quantity (10,000)" in a unified format, and combine the data in Annex 2 with the supplementary data into a complete data framework to facilitate unified analysis

6.1.2. Decoding the trend of the global pet industry

Pet Cat and Dog Population Trend Analysis:

Count the total number of pet cats and dogs per year worldwide, and aggregate data by year and pet type using the grouping summation method.

Plot the number of pet cats and dogs to visualize the development of different types of pets over the past five years.

Observe the key changes:

Cats: An accelerating trend in population change.

Dogs: Population growth has flattened or even declined.

Market Size Trend Analysis:

The market size is broken down by data type (food, medical, nursing).

Draw a line chart of the global pet food, medical services, and care consumer market size from 2019 to 2023 to show the dynamics of each market segment.

Compare the growth rate and absolute size of different market sectors and identify areas of development for development

6.1.3. Mining of the driving factors of the global pet industry

Correlation analysis of data variables:

Analyze the correlation between the number of pets and the size of the market and identify possible causal relationships.

Use heat maps or scatter plots to visualize the relationships between different variables.

High-growth market sector analysis:

Compare the growth rates of the three major sectors of food, medical care, and nursing care to identify high-growth areas.

Combined with the forecast data of the global market growth rate for the next three years, the future growth drivers are extrapolated.

Market Distribution Analysis:

Calculate the market size by country (United States, France, Germany) and global to identify the main contributing regions.

6.1.4. Future demand forecast for the pet industry

Feature Engineering Optimization:

Select a feature variable with high relevance as input to the model.

Use the year to generate polynomial features to improve the model's ability to capture nonlinear trends

Build a predictive model:

Polynomial regression model: suitable for scenarios with small samples and smooth trends, formula:

Random Forest Regression Model: Captures complex nonlinear relationships using multi-tree ensembles, formula:

Model Evaluation:

The predictive performance of the model is measured using the coefficient of determination and MAE

Predicting Future Trends: Forecasting the global pet food market demand over the next three years (2024-2026).

6.2 Preliminary judgment on the visualization and development of global pet data

6.2.1 Decoding the trend of the global pet industry

This image shows the trend of the number of pet cats and dogs worldwide from 2019 to 2023, with the horizontal axis being the year and the vertical axis being the number (unit: 10,000). Two lines are shown, representing changes in the number of pet cats and dogs worldwide. It can be observed that the number of pet cats showed a significant decline in 2020, followed by a sharp recovery and a gradual decline; The number of pet dogs is relatively stable, but there is a slight decline from 2021 to 2023. This trend reveals the development characteristics and market trends of different types of pets in the global pet industry in the past five years.

(1) Analysis of the number of pet cats

The number of pet cats in 2019 was the highest point worldwide, with more than 125 million, indicating the sheer size of the global pet cat market. This number reflects the continued popularity of pet cats in the first few years of 2019 due to their adaptation to urban life and ease of care.

In 2020, the number of pet cats dropped sharply to 95 million, a decline of nearly 30%. The main reason may be due to the deterioration of economic conditions in some areas and policy reasons in the early stage of the outbreak of the new crown epidemic, and the decline in residents' pet raising and spending power. And the epidemic has restricted pet trading, rescue and other activities, which has had a direct impact on the number of pet cats.

In 2021, the number of pet cats rebounded rapidly to 125 million, reaching the level of 2019. This may be related to the recovery of the market in the later stage of the epidemic and the growth of residents' demand for pets.

Subsequently, the number of pet cats in 2022 and 2023 gradually decreased and stabilized, indicating that the market has entered a stage of adjustment and tends to stabilize after experiencing epidemic fluctuations. This change may reflect the gradual saturation of the global pet cat market and the trend of pet culture expanding to other pet breeds.

(2) Pet dog population analysis

Between 2019 and 2021, the number of pet dogs remained largely stable, remaining at around 105 million. Compared with the fluctuation of the number of pet cats, the pet dog market is more mature. It may be due to the fact that pet dogs need more activity space and time investment, the market expansion rate is relatively slow, and the maintenance habits of pet dogs are relatively fixed, and the changes in market demand are less affected by fluctuations in the economic environment.

From 2022 to 2023, the number of pet dogs has gradually decreased, from 105 million to about 100 million.

The possible reasons include the prohibition policies in some countries and regions that limit the growth of the pet dog market. In addition, the rapid growth of pet cats may have diverted some of the potential pet dog market share, especially in countries with accelerated urbanization.

(3) Analysis of the interaction trend of the number of cats and dogs

The chart shows that the global pet cat population rebounded rapidly in 2021, forming an intersection with the number of pet dogs. Since then, the number of pet cats has gradually declined, while the number of pet dogs has remained relatively stable. This phenomenon may reflect the dynamic balance of the global market's demand for cats and dogs: in the post-epidemic market recovery, pet cats occupy the market at a faster rate, while the pet dog market is relatively stable.

By 2023, the gap in the number of pet cats and dogs will close to a very similar level (about 100000). This may indicate that the global pet market is entering a more diversified and balanced phase, with increased competition between different pet species.

and (4) potential drivers

Economic and Epidemic Impact:

The large fluctuations in the number of pets in 2020 may be related to the economic uncertainty caused by the epidemic, which has affected residents' pet ownership decisions.

In addition, the post-pandemic surge in consumer demand for pets, especially pet cats, which are easier to care for, explains the rapid rebound in 2021.

Urbanization:

The decline in the number of pet cats after the peak may be related to the spatial constraints and the shift in consumption distribution in the process of urbanization. The stability of the pet dog market may be due to the stability of pet keeping habits in the countryside and suburbs.

Culture & Policy:

Different countries and regions have different pet maintenance cultures and legal policies, which have a differentiated impact on the growth of pet population. For example, some countries are more welcoming to pet cats and have strict management measures for pet dogs.

6.3 Analysis and forecast of the development of the global pet food industry

6.3.1 Mining of driving factors in the global pet industry

The chart shows the changes in the market size of the global pet food market from 2019 to 2026, with historical actual data from 2019 to 2023 and 2024 to2026 is forecast. The horizontal axis is the year, and the vertical axis is the market size (unit: 100 million US dollars). The chart shows the historical market size trend with a solid blue line, and the projected market size for the next three years is shown with an orange dotted line. Overall, the pet food market showed steady growth from 2019 to 2023, but from 2024 to 2026, the market size growth began to saturate and declined slightly. This reflects that the global pet food market may enter a phase of slowing growth or even a slight adjustment.

(1) Historical data analysis (2019-2023).

Steady Growth:

From 2019 to 2023, the global pet food market size grew from $62 billion to $70 billion, with an average annual growth rate of about 3.1%. This growth shows that the pet food industry has continued to expand over the past five years, especially driven by the popularity of pet care culture and consumption upgrades.

Key drivers of growth are likely to include:

Increasing pet population: The growth in the number of pet cats and dogs worldwide is directly driving the demand for pet food.

Increasing demand for high-end products: Consumer demand for high-quality, healthy, and personalized pet food is rising.

Acceleration phase (2019-2021):

Between 2019 and 2021, the market size grew rapidly, increasing from $62 billion to $68 billion. The rapid growth during this period may be related to the following factors:

Pet market recovery and expansion: During the pandemic in 2020, the demand for pet companionship surged, and pet food consumption rose accordingly.

Popularization of online consumption: The pandemic has boosted the development of online sales channels for pet food and expanded market coverage.

Slowing growth (2022-2023):

Since 2022, the growth rate of the market size has slowed down, from $68 billion to $70 billion. This shows that after the rapid growth of the previous years, the market has gradually entered a stage of stable development, and the marginal growth of demand has begun to weaken.

(2) Forecast data analysis (2024-2026).

Growth tends to be saturated:

According to the forecast data, the global pet food market size from 2024 to 2026 will be $70.5 billion, $71 billion and $70 billion, respectively. Although the market maintained a slight increase in 2024 and 2025, it began to show a slight decline in 2026.

This trend is likely to be influenced by the following factors:

Market saturation: As the growth rate of pet population slows, the demand for pet food tends to stabilize.

Changes in the economic environment: Uncertainty about the global economic recovery is likely to dampen consumer spending on pet food.

Possibility of a slight decline:

The forecast market size in 2026 is $70 billion, slightly lower than $71 billion in 2025. This decline may be related to the following reasons:

Increased competition: As more brands enter the market, price competition can squeeze overall market revenues.

Consumption upgrade challenges: The market acceptance of high-end products may reach a bottleneck, and the incremental market is difficult to sustain.

Differentiated performance in regional markets:

Market performance may vary significantly from country to country. For example, the pet food market in the United States and Europe is already very mature and slowing down, while the market growth potential in developing countries is still high.

(3) Interpretation of market trends

High-end and diversified needs:

As consumers become more concerned about pet health, high-end pet foods, functional foods such as specialty foods designed for pet age, size, and health concerns will be the main drivers of growth in the future.

In addition, environmentally friendly and sustainable pet food is becoming a new market hotspot.

The Importance of Online Selling:

Over the past few years, online sales channels have contributed significantly to market expansion. In the future, e-commerce will continue to be an important sales channel, but its growth rate is likely to slow down and the market competition will become more intense.

Policy and environmental impacts:

Food safety policies and fluctuations in raw material prices in various countries can have a significant impact on the size of the market. In particular, disruptions in international supply chains can lead to higher product costs, which in turn can affect consumer demand.

6 4 Forecasts of food demand and market conditions for the next three years

1. Year Analysis: Overview and Details of Growth and Adjustment

According to our forecast model, the global pet food market will experience a process from slow growth to slight decline in the next three years (2024-2026), which is manifested by:

2024: Steady growth

The market size is expected to reach US$71.148 billion, an increase of about 1.6% over the previous year. This growth trend reflects the fact that the global pet food market still has some potential for expansion.

Growth drivers are likely to include: higher consumer demand for pet food quality and health, driving demand for high-end products; The steady contribution of online sales channels, although the growth rate has slowed down, the increase in market penetration still provides support for the overall market size; The increase in the number of pets in emerging markets such as India and Brazil, as well as the improvement of the spending power of the middle class, have injected new vitality into the market.

2025: Growth peaks

The market size is forecast to be USD 71,228 million, an increase of only USD 0.8 billion compared to 2024. This indicates that the market growth is approaching a bottleneck, and the marginal growth of demand has further weakened.

Reasons for the slowdown may include: pet food consumption penetration in major developed markets such as the US and Europe is already high, and there is limited room for further expansion; Intensified market competition, price competition between brands and product homogenization may inhibit the growth of industry profits; The slowdown in global economic growth could have a negative impact on consumers' disposable income and pet spending on their pets.

2026: Slight decline

The market size is expected to be $70.692 billion, a decrease of approximately $536 million from 2025. This is the first time that the market size has declined after years of steady growth.

Reasons for the decline may include: increased product costs due to fluctuations in raw material prices and consumers switching to more economical options; The market acceptance of high-end products and functional products is close to saturation, and it is difficult to continue to support the continuous growth of the market; Some consumers are shifting their spending to other related areas such as pet healthcare, care, etc., thereby reducing demand in the food market.

2. Market dynamics and drivers

Regional differentiation impact

In developed countries such as the United States and Europe, the pet food market has matured, and the trend of premiumization has become a key factor driving further growth. However, it is worth noting that the intensification of the aging population and the slowdown in the rate of economic growth may bring some constraints to the further expansion of the market.

In contrast, emerging markets, such as Asia and Latin America, show a very different dynamic. The growing number of pets and the increasing consumer demand for high-quality pet food have created significant growth potential for the pet food market in these regions.

Consumption upgrading and structural changes

In terms of consumption upgrading and changes in market structure, the trend of health is becoming more and more obvious. Consumers are paying more attention to the ingredients, nutritional value and safety of pet food than ever before, and this change is directly driving the growth of market segments such as grain-free, organic and special functional foods.

At the same time, the concept of sustainable development has gradually taken root in the hearts of the people, and environmentally friendly and low-carbon pet food is increasingly favored by the market. For example, the research and development of new products such as plant-based foods and cell-cultured foods is gradually becoming a new hot spot in the market.

The popularity of online channels

In terms of online channels, the rapid development of e-commerce channels during the epidemic has brought new growth opportunities to the pet food market. However, with the increasing competition in the online market and the slowdown in growth, the marginal contribution of e-commerce channels to market growth may gradually weaken.

Raw material and supply chain challenges

Global supply chain disruptions and rising raw material prices are likely to adversely affect the growth of the market size. For example, fluctuations in meat and grain prices can directly affect the pricing and cost structure of pet food.

7. Question 3

7.1 Data processing and model building

7.1.1 Data collection and collation

Source:

China's total output value of pet food (unit: 100 million yuan, 2019-2023).

Total value of China's pet food exports (in US$ billion, 2019-2023).

The data shows the development of China's pet food industry over the past five years.

Data wrangling:

Convert the data in Annex 3 into a format suitable for analysis and build a table containing the year, GDP and total export value.

Convert data to the DataFrame format of pandas in Python for subsequent analysis and modeling.

Check data integrity:

Check for missing or outliers.

Ensure data unit consistency (RMB and USD are processed separately)

7.1.2 Visualization of GDP vs. Total Exports:

Draw a two-axis line chart of GDP and total exports:

The left axis shows the gross domestic product (100 million RMB).

The right axis shows the total value of exports (US$ billion).

Use different colors and line types to distinguish between production and export data to ensure that the information is clear and intuitive.

7.1.3 ARIMA Model:

ARIMA is a classic model for time series analysis, which is used to predict the trend of data with certain regularities. its basic form:

: Autoregressive order (AR part).

: The number of differences, which is used to smooth the sequence

: Moving average order (MA part).

Data preprocessing:

The initial export volume sequence is non-stationary and becomes stationary after passing the first-order difference (ADF test p-value ).

ACF (autocorrelation) and PACF (partial autocorrelation) analyses were preliminarily determined .

Initial ADF Statistic: 0.153350

p-value: 0.969520

Critical Values: {'1%': -7.355440625, '5%': -4.474365000000001, '10%': -3.1269325}

ADF Test after 1 difference(s):

ADF Statistic: -39.847363

p-value: 0.000000

Critical Values: {'1%': -10.41719074074074, '5%': -5.77838074074074, '10%': -3.391681111111111}

7.1.4 Build a predictive model

Feature Engineering Optimization:

Select a feature variable with high relevance as input to the model.

Use the year to generate polynomial features to improve the model's ability to capture nonlinear trends:

Build a predictive model:

Polynomial regression model: suitable for scenarios with small samples and smooth trends, formula:

Random Forest Regression Model: Captures complex nonlinear relationships using multi-tree ensembles, formula:

Model Evaluation:

The predictive performance of the model is measured using the coefficient of determination and MAE

Predicting future trends: Predicting the production and export of pet food in China over the next three years.

7.2 Data Visualization and Food Industry Analysis

7.2.1 Model Building

The chart depicts the dynamics of China's pet food industry's gross domestic product (in RMB) and exports (in US dollars) between 2019 and 2023. Among them, the solid blue line represents the gross domestic product, and the orange dotted line represents the total value of exports. The two sets of data use different vertical scales, with the left vertical axis showing the total output value (in 100 million yuan) and the right vertical axis showing the total export value (in US dollars). Overall, GDP showed a steady upward trend, while total exports experienced large fluctuations, but eventually showed a recovery momentum.

7.2.2 Trend Analysis of Food Industry:

(1) Analysis of total food production

Overall Trends:

From 44.07 billion yuan in 2019 to 279.3 billion yuan in 2023, the GDP has increased by more than 6 times, showing the strong development momentum of the domestic pet food industry. This growth is mainly due to the rapid increase in the number of pets in the country and the increasing consumer demand for high-quality pet food.

Phased Trends:

2019-2020: GDP increased from 44.07 billion yuan to 72.73 billion yuan, with a growth rate of about 65%. This growth may be due to the expansion of the domestic pet market and the strengthening of the industry's infrastructure.

2020-2021: GDP climbed sharply to 155.4 billion yuan, with a growth rate of more than 100%. During this period, pets, as an important role in emotional companionship, promoted the explosive growth of the pet food market.

The slight decline in 2022: from 155.4 billion yuan to 150.8 billion yuan, may be the result of temporary saturation of market demand or fluctuations in the economic environment.

In 2023, it will rise sharply again: it will reach 279.3 billion yuan in 2023, a record high, and the display industry will recover and further expand.

(2) Analysis of the total value of food exports

The overall trend has changed significantly:

China's pet food exports experienced a significant decline between 2019 and 2020, falling from US$15.41 billion to US$980 million, but then gradually rebounded to 2023$3.96 billion. This change reflects the impact on China's pet food exports during the pandemic and the subsequent recovery trend.

Phased Trends:

Sharp decline in 2019-2020:

The total value of exports decreased significantly to US$980 million in 2020, only 6.3% of the 2019 level. This reduction is likely to be related to several factors: first, the deterioration of the international trading environment, secondly, the logistical disruptions caused by the coronavirus pandemic, and finally the contraction of export markets. The combination of these factors has led to a decline in the total value of exports.

Gradual recovery in 2021-2023:

The total value of exports rebounded to $1.22 billion in 2021, further increased to $2.47 billion in 2022, and reached $3.96 billion in 2023. The resumption of growth is likely to be supported by the gradual recovery of global supply chains and the renewed demand for Chinese pet food in the international market.

7.3 Presentation of Prediction Models and Future Predictive Analysis

7.3.1 Data Forecasting

From 2019 to 2026, China's pet food industry is showing a steady growth trend. The solid line shows historical data on production and exports, while the dotted line predicts the course from 2024 to 2026. The total output value of the industry continues to grow, far exceeding the total value of exports.

7.3.2 Future Forecast Analysis

(1) Forecast of gross domestic product

According to the image forecast, the GDP will reach 400 billion yuan in 2024 and increase to 510 billion yuan in 2025 and 2026The annual further exceeded 600 billion yuan. This indicates that the domestic market will continue to expand rapidly in the next few years.

(2) Forecast of total export value

Historical Fluctuations and Recoveries:

The total value of exports fell sharply from $15.41 billion in 2019 to $980 million in 2020, and then rebounded year by year, reaching in 2023$3.96 billion. This fluctuation mainly reflects the severe impact of the epidemic on international trade and the subsequent gradual recovery.

Future Forecast Trends (2024-2026):

Forecasts show that the total value of exports will gradually increase from $5 billion to $6 billion from 2024 to 2026, returning to levels close to 2019. The slower growth rate compared to GDP indicates that the export market of China's pet food industry is still facing certain challenges.

74 Market Comparative Analysis and Hidden Challenges

According to forecasts, China's pet food industry will achieve significant growth in the next three years. The total output value is expected to increase from 361.224 billion yuan in 2024 to 599.399 billion yuan in 2026, with an annual growth rate of about 28%. At the same time, the total export value may increase from 14.81 billion US dollars in 2024 to 48.071 billion US dollars in 2026, an increase of more than two times, which indicates that the competitiveness of the industry in domestic and foreign markets is gradually increasing.

(1) Comparison between domestic sales and exports

Dominance of the domestic market:

Although the total value of exports is growing rapidly, it is small compared to the domestic market. In 2024, the total value of exports accounted for 4% of total output value, and this share is expected to rise to 8% by 2026. The expansion of the domestic market is the main driver of the growth of China's pet food industry, and companies need to pay attention to the demand of domestic consumers for high-quality, functional and environmentally friendly pet food.

Growth potential in export markets:

Despite the rapid growth in the total value of exports, they account for a relatively small share of the domestic market, accounting for only 4% of total output in 2024 and are expected to increase to 8% by 2026. By strengthening the brand presence and localization strategy in the international market, the export market is expected to occupy a larger share in the future.

(2) Hidden challenges and solutions

Potential risks of domestic market saturation:

Faced with the challenge of a possible slowdown in market growth, companies need to tap into market potential through innovation and brand upgrading. Enhance product diversity and personalization to cater to the needs of different consumers, especially in the mid-to-high-end market.

Uncertainty in the international market:

Changes in the international trade environment (e.g., tariff policies, increased competition) and fluctuations in logistics costs can put pressure on export markets. Strategies include optimizing supply chain management, improving the quality of export products, and strengthening local cooperation with overseas markets.

Technology & Innovation Drives Growth:

In the next three years, technological innovation will be the main driver of growth for China's pet food industry. Through the research and development of plant-based food, environmentally friendly packaging and precision nutrition products, the company will consolidate its market position and meet the needs of the global pet food market for consumption upgrades. It is expected that the domestic market will promote the total output value to exceed 600 billion yuan, and the export market will also show strong growth, becoming an important engine for the growth of the industry. Through innovation and market layout optimization, the industry will achieve high-quality development in domestic and foreign markets and enhance its influence in the global pet industry.

Question 4

8.1 Data processing and model building

8.1.1 Data collection and collation

Integrate data sources:

Forecast data: China's pet food production and export value from 2024 to 2026.

External Economic Policy Data:

Historical tariff levels: Assume the impact of different tariff policies on the total value of exports.

Global Market Demand Growth Rate: Collects the annual growth rate of the global pet food market to reflect changes in global demand.

Fluctuations in the US dollar exchange rate: reflect the competitiveness of export commodities in the international market.

Preliminary forecast results: Combined with the output value and export forecast of question 3.

Build a full data framework:

Tariff levels, global market demand growth rates, and U.S. dollar exchange rates are used as characteristic variables, and total export values are used as target variables, which are organized into tabular data.

Save as an Excel file for later analysis

8.1.2 Data exploration and visualization

Plot a Variable Diagram:

Tariff level and total export value: Observe the trend of total export value under different tariff levels to determine whether tariff changes have a significant impact on exports.

Global Demand Growth Rate vs. Total Exports: Plot a scatter plot of demand growth and total exports to see the correlation between the two.

U.S. dollar exchange rate and total export value: Analyze the impact of exchange rate fluctuations on total export value.

Analyze trends:

The relationship between the characteristic variables and the target variables is visually observed through charts to provide guidance for model construction

8.1.3 Build a mathematical model

Model Selection:

A multiple linear regression model is used with the following formula:

where Y represents the total value of exports, and β1, β2, and β3 are the reversion coefficients of tariff levels, global demand growth rates, and the US dollar exchange rate, respectively.

Data Division:

Characteristic variables (tariff level, global demand growth rate, dollar exchange rate) are used as independent variables for the consolidated data.

The target variable is the total value of exports.

Model Training:

The linear regression model was used to fit the data, and the regression coefficients of each variable were obtained to quantify their impact on the total export value.

Model Validation:

The mean square error (MSE) and coefficient of determination () of the model were calculated to evaluate the model performance.

If the model fitting effect is not good, you can try to add quadratic terms or interactive terms to build a polynomial regression model.

8.2 Data visualization analysis and impact analysis

Data visualization and its analysis

The graph shows the trend of the impact of tariff levels on China's total pet food exports (in US dollars). The solid blue dots represent historical forecasts, and the orange dotted dots represent simulated forecasts. The horizontal axis is the tariff level (%), and the vertical axis is the total export value (US$100 million). On the whole, with the rise of tariff levels, the total export value of China's pet food shows a decreasing trend, but the impact is affected by a combination of factors.

(1) Analysis of historical predicted values

Increasing trend of historical data:

The solid blue line shows that at lower tariff levels (e.g. 5% and 10%), China's total pet food exports are worth more than US$15 billion and US$30 billion, respectively.

When the tariff level was raised to 15 percent, the total value of exports began to fall to just under $50 billion. The negative impact of tariffs on exports is gradually becoming apparent.

The direct impact of tariffs:

Historical forecasts indicate that the increase in tariff levels has a direct impact on the growth rate of total exports. Although the total value of exports continued to grow, the rate of growth slowed significantly.

This trend reflects the suppressive effect of tariff increases on the international competitiveness of China's pet food.

Absorption capacity of the international market:

Within the 5%-10% tariff range, the demand of China's pet food export market remained stable, indicating that the international market has a strong ability to absorb the price of Chinese pet food.

When tariff levels exceed 15 per cent, price-sensitive markets may choose other suppliers due to increased costs, resulting in dampened growth in total export value.

(2) Simulation prediction value analysis

Linear trend of simulated data:

The dotted orange line shows that the simulated forecast is consistent with the overall trend of the historical forecast. The total export value shows a linear decreasing trend with the increase of tariff level.

When the tariff level reaches 20%, the total value of exports projected by the simulation is close to US$60 billion, demonstrating the ability of the market to adjust under the higher tariff scenario.

Deviation from historical data:

The deviation between the simulated prediction and the historical prediction is small, indicating that the multiple regression model has a good fitting effect on the relationship between tariff level and total export value.

The total export value projected by the simulations is slightly higher than the historical projections, which may reflect the moderating effect of global demand growth rates and exchange rates in the model, partially offsetting the negative impact of rising tariffs.

Changes in exports under the policy scenario:

Under the 20% high tariff scenario, the total export value still maintains a steady growth, indicating that China's pet food industry has a certain resilience in the international market, especially in the low-end market.

8.3 Feasible coping strategies

1. Optimize the layout of the international market

Expansion into emerging markets:

Target market: Southeast Asia, Latin America, Africa and other regions have a rapid growth in demand for pet food, and the tariff policy is relatively relaxed.

How it works: Establish sales channels in emerging markets, reach out to local markets through partners or distributors, and offer products that meet local consumption levels and preferences.

Diversify export risk:

Reduce dependence on a single market (e.g., the United States, Europe) and reduce the impact of external economic policies on exports. Formulate differentiated product and marketing strategies for different countries to enhance the ability to resist risks in diversified markets.

Strengthening international trade cooperation:

Actively participate in the negotiation of free trade agreements (FTAs) and establish long-term cooperative relations with countries with friendly tariff policies. Take advantage of the Belt and Road Initiative to strengthen trade cooperation with countries along the route

2. Enhance the added value of products

Promote high-end and differentiated development:

Premiumization: R&D of functional pet foods, such as grain-free, organic pet food, as well as specialized foods designed for pet health issues (e.g., obesity, allergies).

Differentiation: Combined with the dietary preferences of pets in various countries, we will launch customized products that meet the local culture and consumption habits.

Enhance brand influence:

Through international brand building, improve the awareness and reputation of Chinese pet food in the international market.

Participate in global industry trade shows, expand product awareness, and engage directly with consumers through social media.

Developing sustainable products:

Launched eco-friendly pet foods, such as plant-based foods, and products with biodegradable packaging materials to cater to global consumer sustainability concerns.

Strengthen the construction of raw material traceability system to ensure food safety and enhance the trust of the international market

3. Optimize supply chain and cost control

Boost productivity

Introduce intelligent manufacturing technology, optimize the production process, reduce unit costs, and enhance price competitiveness.

Promote large-scale aquaculture and intensive production to improve the efficiency of the upstream supply chain.

Localized Operations:

Establish local production bases or cooperative factories in major export markets (e.g., the United States, Europe) to reduce customs duties and logistics costs.

Layout of overseas warehousing and logistics centers to improve order response speed and enhance supply chain stability.

Risk Management:

Establish a flexible supply chain system to quickly adjust export strategies in response to changes in external economic policies.

Lock in raw material costs with long-term purchase agreements to reduce the impact of market fluctuations

4. Strengthen policy response and research

Participate in policy negotiations:

Cooperate with relevant government departments and industry associations to actively participate in international trade negotiations and strive for more favorable tariffs and market access conditions. Closely follow the changes in economic policies of European and American countries, and make response plans in advance.

Strengthen the construction of industry standards

Take the initiative to connect with international industry organizations, participate in the formulation of international pet food standards, and improve the international recognition of export products.

Promote domestic enterprises to integrate with international standards in quality control and certification systems, and enhance their competitiveness in the high-end market.

Building a Policy Research Team:

Establish a professional research team for external economic policies such as tariffs, exchange rates, and market demand, and provide forward-looking guidance for enterprise decision-making.

Regularly publish international market dynamic analysis reports to provide data support for the development of the industry

8.3 Strategic implications at different levels

1. Enhance the industry's ability to resist risks

In the face of fluctuations in the global economic environment, China's pet food industry diversifies risks through diversified export strategies and international market layout, such as exploring emerging markets such as Southeast Asia and Africa to reduce dependence on European and American markets, and avoiding a sharp decline in exports caused by changes in single market policies. At the same time, we use financial instruments to hedge exchange rate risks, maintain product price competitiveness, and enhance the industry's ability to resist risks in a complex international environment.

2. Promote high-end products and enhance international competitiveness

In the face of the uncertainty of the global economic environment, China's pet food industry diversifies risks by diversifying export strategies and international market layout, such as developing emerging markets such as Southeast Asia and Africa to reduce dependence on European and American markets, and avoiding a sharp decline in exports caused by policy changes in a single market. At the same time, we use financial instruments to hedge exchange rate risks, maintain product price competitiveness, and enhance the industry's ability to resist risks in a complex international environment.

3. Optimize the supply chain and improve cost efficiency

In order to improve the performance of enterprises in terms of cost competitiveness and market responsiveness, supply chain optimization and intelligent production logistics are crucial. By establishing overseas warehousing and production bases, companies are able to reduce logistics costs, shorten delivery times, and improve their responsiveness to market changes, thereby enhancing customer satisfaction and market share. At the same time, it also helps to circumvent tariff barriers and enhance the competitiveness of products in the international market.

Fourth, promote the sustainable development of the industry

Global consumers' concern about the safety and sustainability of pet food has prompted Chinese companies to develop eco-friendly pet food and biodegradable packaging to follow market trends. At the same time, through the development of green production technologies, such as reducing carbon emissions and the use of new protein sources, Chinese companies not only meet international environmental standards, but also establish a responsible corporate image, laying the foundation for winning recognition in the international market and the long-term development of the industry.

9. Evaluation of the model

9.1 Advantages of the model

 Data comprehensiveness: The model integrates detailed historical data of the pet food industry, covering gross output value, export value and key economic variables, providing a comprehensive analytical perspective on the current situation and future trends of the industry, and enhancing the accuracy of forecasting. The data covers a wide range of domestic and foreign markets, combining historical and simulated data to ensure that the forecast results are more in line with the actual situation.

 Strong applicability: The model can analyze the impact of policies on exports, and provide strategic optimization for enterprises, which has academic and practical application value. It is able to adapt to different market conditions and support quantitative analysis under different policy scenarios.

Model flexibility: By introducing nonlinear features such as polynomials, multiple regression models enhance their ability to capture complex variable relationships, especially when tariffs and exchange rates fluctuate wildly. The model can flexibly adjust the variables, which improves the ability to identify nonlinear trends.

 Strategy Practicality: The proposed strategy aims to enhance the international competitiveness of China's pet food industry, including market diversification, high-end product development, supply chain optimization, and sustainable product innovation. These strategies focus on developing emerging markets to reduce dependence on the European and American markets, and highlight technology and environmental protection to lay the foundation for the sustainable development of the industry.

9.2 Disadvantages of Modeling

Variable simplification can lead to biased results: Models, while incorporating key factors such as tariffs, exchange rates, and global demand growth rates, may not adequately capture the complexities of international markets, such as changes in consumer behavior, the impact of cultural differences on demand, and the specific impact of regional policies on exports.

 Low model complexity: Multiple regression models are easy to understand and apply, but they may be limited in dealing with nonlinear relationships, such as tariff changes have different impacts on different regions, and need to be captured by nonlinear models. It may not adequately explain the complex interactions between factors and cope with sudden changes in the external economic environment.

 Lack of dynamic adjustment mechanism: The model is based on historical data and assumes that the future market and policy environment will be similar to the past, which can lead to inaccurate forecasts in the event of a drastic change in economic policy or consumer trends. Models need to be more responsive to unpredictability and incorporate real-time data update mechanisms.

10. Improvement and promotion of the model

10.1 Model Improvements

 Introduce time series models: Improve the responsiveness of models to market dynamics, and use time series analysis, such as LSTM models, to capture policy and market fluctuations and improve the accuracy and adaptability of forecasts.

 Incorporate consumer behavior analysis: By analyzing social media and consumer survey data, companies can accurately grasp the consumption preferences of the international market, provide detailed guidance for export strategies, help enterprises accurately locate target consumer groups, and provide data support for marketing strategies.

 Optimized feature engineering: In order to improve the ability of the model to capture complex variable relationships, especially in the case of high tariffs or large exchange rate fluctuations, more interactive items and higher-order features can be introduced. At the same time, by applying regularization techniques, such as Lasso or Ridge, the model can be effectively avoided from overfitting, and the generalization ability of the model can be enhanced.

10.2 Promotion of the model

 Extra-industry references: The model is not only applicable to the pet food industry, but can also be used across industries, including agriculture, clothing, and electronics. After adjusting for variables and data, the model can analyze the impact of tariffs and exchange rates on these sectors, improving its applicability in multi-sector policy analysis.

 Application in international cooperation: The model provides data support for governments and enterprises in international trade negotiations, quantifies the impact of tariffs on China's exports, helps formulate international cooperation agreements and participates in trade policy negotiations, and provides data basis for industry decision-making.

 Education and Research Promotion: This model can be used for case teaching in business schools and economic research institutions, to improve the educational value, inspire new research ideas, and enable students and researchers to master quantitative analysis skills in economic problems.

 Enterprise management tool development: Transform the model into management software to help enterprises formulate international strategies, support enterprise decision-making through real-time data analysis, and realize intelligent strategic analysis.

11. References

[1] Gao Jiaodi. Nutrition "can not be more and can not be less"——new trend of pet food consumption[N].China Food News,2024-08-30(007). DOI:10.28137/n.cnki.ncspb.2024.001960.

[2] Yi Changsong, Zhang Zhaojun, Yin Yaoxin, et al. Animal Husbandry Industry,2024,(02):40-44.)

[3] Yang Whale. Research on marketing strategy optimization of HX Pet Food Co., Ltd.[D].Hebei University of Science and Technology,2023.DOI:10.27107/d.cnki.ghbku.2023.000427.

[4] Tang Li. International Business Daily,2022-08-19(003). DOI:10.28270/n.cnki.ngjsb.2022.003282.

[5] Xing Yun, Wu Guodong. How strong is the pet industry here? Hebei Daily,2021-10-27(015). DOI:10.28326/n.cnki.nhbrb.2021.008157.