Petfood Industry Electronic Newsletter July 17, 2007

July 17, 2007
Volume 7, Number 14

This newsletter is also available in an Acrobat PDF format. To download the PDF click on the following link: Jul17PDF.

Your free copy of the Petfood Industry Electronic Newsletter is sponsored by AFB International, maker of Optimizor® and BioFlavor® brand palatants. AFB is the petfood industry's first choice for dog and cat food palatants. For more information, please visit our website at http://www.afbinternational.com.

Here's what's been happening lately:

Industry News

Nutrena introduces Loyall petfood line
A new line of premium dog and cat food, Loyall, will soon be available at ag-retail outlets around the country, including Nutrena, Agway and ACCO dealers. The Loyall team of researchers and nutritionists has formulated one cat and seven dog food products. The eight Loyall dry formulations come in 20-, 40- or 50-pound bags. The Loyall (www.loyallpetfood.com) line will be available at US retail outlets by early August.

Rio Tinto bids US$38.1 billion for Alcan
Rio Tinto has reportedly submitted a US$38.1 billion offer for the Canadian aluminum producer Alcan, US$10 billion more than the recent bid made by Alcoa. The acquisition will fuel a fourfold increase in Rio's aluminum output and see it overtake Alcoa and Russia's Rusal as the world's biggest producer of the metal.

Rio noted that the combined Rio Tinto Alcan aluminum division would be based at Montreal, Canada and led by Dick Evans, the current Alcan chief executive. Alcan had rejected a hostile US$28 billion, offer from Alcoa, the Pittsburgh, Pennsylvania, USA-based company.

AFIA offices moved in Washington, D.C.
AFIA has moved its office to its new location at 2101 Wilson Blvd., Suite 916, Arlington VA 22201 USA. Tel: +1.703.524.0810, Fax: +1.703.524.1921 and E-mail: afia@afia.org.

T. E. Ibberson Co. honored for plant construction
T. E. Ibberson Company, Hopkins, Minnesota, USA, received an Eagle Award from the Associated Builders and Contractors at the ABC 2006 National Excellence in Construction banquet held June 12, 2007. The winning entry was the West Coast Expansion Project, a premium petfood manufacturing facility for Nutro Products Inc. in Victorville, California, USA.

This new US$75 million state-of-the-art facility was a replacement facility for an aging plant in the City of Industry, California. The project is a 382,200 square-foot premium petfood manufacturing plant situated on a 30-acre site in the Mojave Desert. The process design included two 15 million pound-per-month production lines for a total capacity of 30 million pounds per month.

Ruling favors MGP Ingredients over Greenies
MGP Ingredients Inc.'s legal action against Mars Inc. over Greenies dog treats took a step forward recently in favor of the Atchison, Kansas, USA-based ingredient maker. MGP sued Mars last year after it bought S&M NuTec LLC, which developed and makes Greenies treats. After it bought the company, Mars reportedly said it developed its own formula for making Greenies, and S&M subsequently quit using MGP as an ingredient supplier. As a result of those moves, MGP filed a lawsuit in US District Court in Kansas alleging that Mars infringed on an MGP patent, interfered in MGP's business relationship with S&M, breached a contract and breached a confidentiality agreement.

Recently, the judge overseeing the case ruled in favor of MGP on four patent construction claims in the dispute. MGP CEO Tim Newkirk said while the ruling is early in the legal process, the company was pleased with the outcome. Efforts late last year to resolve the lawsuit through non-binding mediation were reportedly unsuccessful.

Readers' Choice survey
We're looking for the best of the petfood industry suppliers and we want your opinion. One respondent will be chosen randomly to receive an iPod Nano! Please tell us the suppliers you think are the best in specific categories that are applicable to your business. The results of this survey will appear in a future issue of Petfood Industry. Click on this link to take the survey: http://www.surveymonkey.com/s.aspx?sm=hs5KhxWcuazpVlr_2baugZuA_3d_3d

Market Data
Each month the Petfood Industry E-newsletter will bring you the latest market data available from several different sources including Euromonitor International, Information Resources Inc. (IRI) and ACNielsen.

Top US food, drug and mass merchandiser (excluding Wal-Mart) petfood sales for the 52 weeks ending June 16, 2007. Source: ACNielsen.

Category	US$ sales	% chg vs. 2006	Unit volume	% chg vs. 2006
Cat dry	$1.03 billion	3.3%	208 million	-2.1%
Cat moist	$2.4 million	-48.2%	1.7 million	-47.5%
Cat wet	$973 million	4.3%	1.6 billion	-5.9%
Dog & cat treats	$781 million	4.4%	294 million	1.7%
Dog dry	$1.7 billion	4.4%	188 million	0.0%
Dog moist	$46 million	0.1%	9.6 million	-7.6%
Dog wet	$649 million	2.5%	707 million	-11.1%
Total (including "remaining petfood")	$5.4 billion	3.9%	3.0 billion	-5.8%

Benelux market rising
Total retail value sales for pet care products in Belgium, the Netherlands and Luxemburg or Benelux markets surpassed €1.3 billion in 2006 according to research from Euromonitor International. This represents an increase of more than 3% from 2005. The dynamic Dutch market remained the largest of the three in 2006, and also drove regional sales growth. However, Belgium and Luxembourg are experiencing many of the same underlying market trends as the Netherlands, to the betterment of sales.

Like other developed markets, Benelux consumers' perception of their pets has become increasingly anthropomorphic, with animals increasingly viewed as surrogate members of families and single-person households. Euromonitor International's research indicates a variety of demographic shifts driving this humanization trend.

The population in Benelux markets is aging, with the number of consumers over the age of 50 growing by 1.3% from 2004 to 2005. In contrast, the region saw total population growth of only 0.4% during the same period. This is significant as older consumers typically have more disposable income with which to lavish their pets. Moreover, an aging population means that more consumers are seeing their children leave home. With no children to provide for, older Benelux consumers are increasingly turning to pets for companionship, and shifting money formerly spent on their children to these animals.

Click here for more information about petfood and pet care reports from Euromonitor International and to buy reports online.

Product News

Double planetary mixer for vacuum mixing
The new Ross model of its Double Planetary Mixer (DPM) is available in sizes from 1/2 pint to 750 gallons working capacity. The DPM is used for vacuum mixing of high viscosity materials up to 8 million cps. Features available include three mix blade designs, jackets for heating or cooling, variable speed drives, sanitary construction and discharge systems to assist in the unloading of highly viscous materials.

Dryer for specialty chemicals
The Horizontal Vacuum Dryer for drying specialty chemicals is available in designs from 1 through 500 cubic feet. The dryer features include stainless steel construction, internal surfaces polished to a 240 grit finish, full vacuum to 25 psig operation, 185 psig dimpled and baffled jacket on trough sides and endplates, and a pneumatic spherical discharge valve.

Reversible rotor/stator mixer
Arde Barinco Inc. offers the new Model CJ-2A reversible homogenizer. The Model CJ-2A is designed to prepare fine grain emulsions and solid particle dispersions in small batches. All results obtained with the Model CJ-2A can be scaled-up to batches as high as 10,000 liters. A proprietary computer program can predict results developed utilizing this small high-shear mixer. The Model CJ-2A has a 0.25 HP 15,000 RPM reversible motor. The unique down-mode is capable of drawing and wetting out floating powders. The down-mode can also be utilized to re-suspend any settled solids on the bottom of the process mixing vessel. The mixer comes complete with a stand and reversible variable-speed control box.

Versatile portable lifting platform
Southworth's portable Lift-Tool is an alternative to variable-height workbenches and facilitates a variety of lifting and positioning jobs, requiring a cordless drill to move the platform up and down. Fully raised, the Lift-Tool's 22-inch x 23-inch platform is 17-3/4 inches high and has a vertical range of 14-1/4 inches. With a load capacity of 300 pounds, it holds 10 times its own weight, which is 32 pounds, and is 3-1/2 inches high when lowered. The Lift-Tool includes options such as an adjustable straddle frame, a turntable and a slanted assembly easel that positions work at 25 degrees.

E-News

European online marketing to double
Online marketing spending in Europe will reportedly double to US$20.16 billion in 2012, from about US$9.45 billion in 2006, according to Forrester Research's European Online Marketing Tops Eur16 Billion in 2012 report. The study covered France, Germany, Italy, the Netherlands, Poland, Spain, Sweden and the UK, and included surveys of both consumers and marketing firms. Marketing spending had been slow in Europe, but over half of companies set their 2007 budgets higher than their actual 2006 spend. E-mail, search and display advertising were also projected to account for 18% of European total media budgets in 2012. The shift in ad spending reflects changing consumer behavior.

Research News

Effect of dietary protein on body composition and renal function in geriatric dogs
Forty healthy geriatric beagles (=10 years, initially 12.0 kg) were fed a control food during a 30-day pre-feeding period, and then blocked by age, gender and body fat percentage. Dogs were randomly assigned to one of four foods (A = Experimental Food, B = Royal Canin Mature Medium Breed, C = Purina Dog Chow Senior and D = Eukanuba Senior Maintenance) for the six-month testing period.

Blood chemistry, microalbuminuria and DEXA were evaluated for changes in kidney health and body composition. At Day 180, body weight increased (P< 0.01) in dogs fed Food B and tended (P< 0.07) to increase in dogs fed Food A. No other differences in weight or changes in weight were detected (P> 0.13). Dogs fed Food B and Food D lost lean (P< 0.05) over the 180-day period. Dogs fed Food B also gained fat (P< 0.01) while the other three foods maintained fat. In addition, dogs fed Food B gained (P< 0.01) bone mineral content (BMC) while dogs fed Food C lost (P< 0.05) BMC. For kidney function markers, blood creatinine was unaffected by dietary treatment (P> 0.25).

Dogs fed Foods B, C and D had higher (P< 0.03) blood urea nitrogen (BUN) levels than dogs fed Food A. For BUN: creatinine ratio, dogs fed Foods B, C and D had elevated (P< 0.02) ratios compared to dogs fed Food A. Dogs fed Food D had a greater percentage of animals with reduced kidney function (P< 0.05) as indicated by microalbuminuria analysis compared to dogs fed Food A. In conclusion, geriatric dogs fed experimental Food A with reduced protein/phosphorus showed less progression of kidney disease compared to the other commercial geriatric foods. In addition, dogs fed experimental Food A maintained lean and bone mass compared to other commercial formulations.

Source: N.Z. Frantz, R.M. Yamka and K.G. Friesen, 2007. Intern J Appl Res Vet Med 5(2): 57-64.

Adaptation of protein oxidation to protein intake in the domestic cat
Work on hepatic enzyme activities has showed that cats lack the ability to regulate the urea cycle enzymes in response to the dietary supply of protein. It was thus hypothesized that the high protein requirement of cats is due to an inability to regulate these enzymes, limiting adaptation to a low protein diet. This study used indirect respiration calorimetry to assess the in vivo ability of cats to adapt to substrate oxidation to different levels of dietary protein, including one below their protein requirement.

In random order, eight cats consumed each of four semi-purified diets containing 7.7% (LP), 14.6% (AP), 27.3% (MP) and 51.1% (HP) of ME from protein. Cats consumed each diet for at least 14 days and then completed a five-day nitrogen balance trial and at least two 12-hour indirect calorimetry measurements. The data were analyzed by ANOVA using the Mixed procedure of SAS and are expressed as mean ±SEM. There was a significant effect of diet on protein oxidations (p<0.0001), measuring 9.8±0.5%, 13.4±0.9%, 23.5±0.8% and 49.0±1.8% of total energy expenditure on the LP, AP, MP and HP diets, respectively.

The ratio of protein oxidation/protein intake was significantly higher with the LP diet (1.27±0.07) than the other three diets (AP, 0.92±0.06; MP, 0.86±0.03; HP, 0.96±0.04; p<0.0001), indicating a net loss of protein on the LP diet. Thus, cats adapted to a wide range of dietary protein concentrations, but were unable to fully adapt to the LP diet.

Source: A.S. Green et al., 2007. Proceedings of the AAVN 7th Annual Clinical Nutrition and Research Symposium, Seattle, Washington, USA.

Positions Available

Sales account manager sought
SPF North America Inc., the worldwide leader of palatability enhancers, is seeking a sales account manager. This position will play a major role in our development in North America. Contact Judy Gehler with your resume at jgehler@spf-usa.com or Fax: +1.715.926.5285.

Our help wanted listings aim to inform petfood industry professionals about employment opportunities worldwide. Contact gstadel@wattnet.net for more information on placing a listing in upcoming issues.

Contact Information

To submit any information you would like us to consider for publication on our website, in the printed magazine, or on this newsletter, E-mail your information to Jenny Kvamme, DVM.

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