• Demand - Soluble coffee

    The term soluble coffee encompasses spray-dried powder, freeze-dried powder and liquefied forms of coffee such as liquid concentrates. All of these methods of processing involve dehydrating brewed roasted and ground coffee. The freeze-dried method produces a superior but more expensive product.

    The figure below shows that world consumption of soluble coffee is rising relatively strongly after a number of years of stagnation, expanding from 21.4 million bags (green bean equivalent) in 1999 to
    29.9 million bags in 2009.

    Source: Neumann Kaffee Gruppe Statistics

    In Europe growth in demand has been relatively modest at around 0.2% a year in recent years, which is considerably slower than the overall growth in consumption for all types of coffee. In the United Kingdom, where soluble coffee accounts for around 80% of total consumption, demand
    was beginning to show signs of actual decline, but has been revitalised in recent years by the growing interest in speciality coffees. Elsewhere in Europe, however, the introduction of new specialty instant coffee products (such as instant cappuccino) increased demand for soluble coffee but the trend appears to have been short lived. The Deutscher Kaffee-Verband estimate that the instant coffee share of demand in Germany rose from 6.2% to over 7.5% between 1998 and 2005 reflecting this surge in demand for these speciality instant products, only to fall back to 4.2% in 2009.

    Much of the recent growth in soluble coffee consumption can be attributed to a rise in demand in Eastern Europe, notably Russia, and the Far East – both regions where soluble coffee enjoy a high market share. In the Far East there has been a tremendous growth in the demand for the product known as ‘3 in 1’, a beverage which combines the convenience of soluble coffee with a non-dairy creamer and sugar, usually in single-serve sachets that can be bought one at time.

    In 2009, 72% of the soluble coffee consumed in importing countries was processed into soluble coffee in those countries. The corresponding figure in 2000 was 83% X, which suggests that producing countries may be seeing a significant increase in their share of the soluble coffee market in importing countries.  Imports of soluble coffee are often referred to as offshore powder. Consumption of instant coffee in producing countries varies considerably. In the Philippines and Thailand instant coffee accounts for around 95% of coffee consumption whereas in Brazil, the largest exporter of soluble coffee, domestic consumption of instant coffee only accounts for around 5% of overall coffee consumption. In India most soluble coffee is also exported although it does account for around 35% of local consumption. In Mexico the figure is about 60%.

    Globally Nestlé and Kraft Foods account for around 75% of the world market, with Nestlé alone supplying over half the world demand for instant coffee.

    Updated 11/2010.

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