Global Instant Coffee Market Catalysed by Continuous Innovation and Ease of Use

Instant coffee is prepared by spray drying or freeze drying roasted or ground coffee beans which can be rehydrated later. Despite the popularity of fresh coffee in the developed and high-income markets, instant coffee is quickly becoming popular all over the world due to its ease of preparation and convenience. The predominantly tea drinking regions of the world, such as Asia, Middle East, Central and Eastern Europe and the United Kingdom, are also witnessing a strong demand for instant coffee. According to a report by IMARC Group, the global instant coffee market has grown at a CAGR of 3.3% during 2008-2015, reaching a volume of 20.7 Million Bags in 2015. This market is further expected to reach a volume of 25.5 Million Bags by 2021.

Continuous Innovation and Ease of Use Driving the Demand

The main advantage offered by instant coffee over fresh coffee is convenience of use. It is easy to prepare and requires no special equipment. Another major factor is continuous innovation that helps in creating new opportunities and gaining popularity among consumers. Furthermore, manufacturers have been coming up with fresh ideas in order to enhance the aroma, quality and flavour of instant coffee so as to offer the consumers an experience of freshly brewed coffee. Innovative formats such as single-serve brewing systems, that are easy to carry and consume, are driving the growth of this market in both the mature and emerging markets.

Growing demand from the emerging markets along with premiumisation, emerging café culture, changing lifestyle, increasing disposable incomes and growing urbanisation are some of the other factors that are helping the trend of coffee consumption to spread to new consumers.

Middle East Expected to be the Fastest Growing Market

Coffee preferences vary from region to region with people preferring either fresh or instant coffee. Instant coffee has gained more popularity in countries where coffee consumption was previously negligible. In regions such as Asia, Middle East, Central and Eastern Europe and United Kingdom, where tea is the culturally preferred beverage, instant coffee accounts for a major share of the total coffee consumption than in countries where coffee consumption had a long history.

Europe, currently, accounts for around 40% of the total instant coffee market share, representing the largest market. The demand for instant coffee in Europe, however, varies region to region with the market witnessing a stronger growth in Central and Eastern Europe as opposed to Western Europe. Europe is followed by Asia, which accounts for 33% of the total market share. In the Asian region, Middle East represents the fastest growing market, exhibiting a CAGR between 10-15%.

Nescafé represents the largest manufacturer

The competitive landscape of the global coffee market (ground coffee and instant coffee) is consolidated with five major players accounting for around 45% of the total market share. In the instant coffee market, which is even more consolidated in nature, Nescafé accounts for more than half of the total market share, representing the largest manufacturer.

About IMARC Group: IMARC Group is a leading market research and consulting company that offers management strategy and market research worldwide. The company has done multiple projects on the instant coffee industry, which has enabled the clients to successfully setup and expand their businesses. Some of the company’s offerings include:

  • Market Research
  • Plant setup
  • Plant Expansion
  • Marketing and sales
  • Procurement and Distribution
  • Innovation and Product Development

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