How does Islam approve of animal sacrifice when all creatures belong to Allah? Why would Allah approve killing of one living creature for the benefit of another?
Many animals eat other animals, and many human societies have also subsisted on animals, especially in areas with limited agriculture. Animal sacrifice is not killing for the sake of killing, as one should respect the animal, but killing so that those who are in need can have food.
Plants are also living creatures and also belong to Allah! Many people interpret the Qur'an as indicating that all beings, whether animal, plant, or stone, have some level of awareness and their own means of glorifying Allah.