The global instant coffee market is expected to witness scores of far-reaching prospects to birth on the back of rising popularity among consumers. The demand for instant coffee could skyrocket in the coming years due to the advantage of quick preparation and convenience. Moreover, the easy availability of instant coffee and its comparatively lower price than the regular variant are anticipated to up the growth of the overall market.
Considering this trend in the market, top players such as Tata Global Beverages could seize the opportunity to improve their profits and expand their presence globally. Tata Coffee has recently announced the setup of its Vietnam project for instant coffee with a 5,000 tons per annum installed capacity. Tata Group chair, N. Chandrasekaran said the project would take around three to four years to mature. Chandrasekaran also said that the Greenfield project would require a INR 350 cr capital expenditure.
According to a leading market research company, Transparency Market Research (TMR), the global instant coffee market could achieve a revenue of US$42.5 bn by 2025, a growth from a US$28.12 bn in 2016. For the forecast period 2017–2025, the market is predicted to rise at a 4.80% CAGR.
Which Part of the World would Instant Coffee Harvest Maximum Demand?
With India and China exhibiting an encouraging interest for instant coffee, Asia Pacific could garner a significant share in the coming years. In 2016, the region had secured a 35.7% share. The uptake of instant coffee here could be tellingly stimulated by the easier preparation method, even though, culturally, tea is always at the top of the minds of consumers.
However, among other regions such as the Middle East and Africa and North America, Europe could tread on the heels of Asia Pacific in terms of demand. On account of a higher preference for filter coffee, North America could testify a declining demand for instant coffee. Furthermore, the advent of a new category of capsules and machines making available cold carbonated drinks whenever required is foreseen to discourage the growth of North America.
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How would Instant Coffee be Profitably Distributed in Market?
Among the primary distribution channels, instant coffee vendors are prognosticated to take to online and offline retail stores and B2B segments such as restaurants and hotels. However, retail stores could attract a massive demand in the coming years due to the availability of a broad scope of instant coffee and eye-catching discounts and offers directly provided by vendors. If this trend continues to hold true for the next few years, retail stores could well lead the international instant coffee market by 2025. In 2016, retail stores sold a relatively vast volume of instant coffee compared to the B2B channel. For offline sales, instant coffee could be highly favored by supermarkets, hypermarkets, and departmental stores.