Analysis of global and Chinese coffee industry market status and development trends in 2020, and changes in market consumption patterns

  1. Overview of the coffee industry

The cultivation of coffee originated in Ethiopia, Africa. It was brought out of Africa by Arabs in the 13th century and cultivated “Arab coffee”. It was introduced to the Middle East, Europe and America in the 16th and 18th centuries. At present, coffee, as the second largest beverage after tea, is grown in more than 50 countries in Asia, Africa and Latin America, and is consumed by about one-third of the world’s people.

The development of China’s coffee industry can be roughly divided into three stages. Coffee cultivation in China was introduced from Taiwan in 1884, and later in Yunnan, Hainan, Guangxi, Guangdong, Fujian, Sichuan and other places.

  1. Analysis of the development status of the global coffee industry

From the perspective of global green coffee production, according to statistics, global green coffee production in 2019 was 10.15 million tons, a year-on-year decrease of 0.6%.

2015-2019 global green coffee production and growth

From the perspective of global green coffee consumption, according to statistics, global green coffee consumption in 2019 was 10.16 million tons, an increase of 0.7% year-on-year.

2015-2019 global green coffee consumption and growth

  1. Analysis of the development status of China’s coffee industry

In 2018, China’s consumption of instant coffee, freshly ground coffee, and ready-to-drink coffee accounted for 71.8%, 18.1%, and 10.1% of total coffee consumption, respectively. Although ready-to-drink coffee is currently lagging in share, with the diversification of coffee consumption and product differentiation, ready-to-drink coffee has the opportunity to gain a larger market share.

With the improvement of people’s living standards and the deepening of the awareness of coffee culture, coffee consumption in China is on the rise year by year. According to statistics, the average annual growth rate of coffee consumption in China is 15%, much higher than the world’s 2% growth rate. In 2025, China’s coffee consumption market is expected to reach 1 trillion yuan.

2013-2021 China’s coffee industry market size and growth

Compared with developed countries, China’s per capita coffee consumption is still at a low level. In 2018, the per capita coffee consumption in mainland China was only 0.71% of that of Germany and 1.6% of that of the United States. The global coffee market is more than 12 trillion, while China currently only has about 70 billion, which is far from the population ratio. According to statistics, the increase in per capita income will promote coffee consumption. For every 5% increase in national income, daily coffee consumption will increase by 2%-3%. With the increase in national income and the gradual cultivation of consumer coffee consumption habits, the potential market for coffee in China The space is huge.

In terms of imports, China imported 10571.2 tons of unroasted coffee in 2019, an increase of 22.6% year-on-year, and the import value was US$27.13 million, an increase of 9.7% year-on-year. China imported 96.5 tons of unroasted coffee in January 2020, and the import value was 360,000 US dollars.

  1. Analysis of the competitive landscape of China’s coffee industry

Looking at the investment and financing situation of the coffee industry’s primary market in 2019, specialty coffee is the main area that has won the favor of capital.

In 2018, the scale of China’s instant coffee market was about 70 billion yuan. Among them, Nescafe ranked first with a market share of 28.5%, much higher than the second place at 5.7%, and the industry CR8 was 53.7%, showing a high concentration.

In the ready-to-drink coffee market in 2018, Nestlé steadily ranked first with a market share of 68.3%, and its market share was about 14 times that of the second-place Beijing Huiyuan. It has a dominant position. The industry CR8 is 88.5%, which is more concentrated than the instant coffee market.

In the freshly ground coffee market, the main sales channels are cafes and self-service coffee machines. Takeaway coffee represented by Luckin is essentially a type of cafe. Therefore, the data of the cafe market is used to look at freshly ground coffee. market outlook. As of the end of 2018, there were 144,000 coffee shops in mainland China. Among them, Starbucks, Luckin, and Mcafee accounted for the top three with 3684/2000/900 respectively, and by the end of 2019, the number of Starbucks and Luckin’s stores has been respectively There are 4292 and 4507. From the perspective of operating income, the size of China’s coffee shop market in 2018 was about 27.1 billion yuan, of which Starbucks accounted for nearly 60% of the market, ranking first, and the second place, Mai Coffee, only had a market share of 6.4%, with a large gap. . The overall industry concentration is high, with CR5’s market share of nearly 75%.

, Analysis of the development trend of China’s coffee industry

  1. China has become a new force in the global coffee bean supply

China has become a new force in the global supply of coffee beans, with steady growth, and global coffee imports are greater than exports, and the imbalance between supply and demand has become more serious. Therefore, the demand for international coffee beans has remained high. As one of the world’s high-quality coffee beans producing areas, China’s annual export volume of coffee beans is also increasing year by year, making China naturally a new force in the global coffee bean supply. At present, Yunnan Province has become a supplier of foreign coffee brand companies such as Nestlé and Starbucks. In 2017, Yunnan Province ranked first in China’s coffee export rankings with an export volume of 60,700 tons, accounting for 57.9% of the country’s coffee exports. Coffee beans have also become the second largest export cash crop in Yunnan Province except tobacco, which has greatly promoted the local economic development.

  1. Increasing competition in the Chinese coffee market

At present, China’s coffee industry is at a preliminary stage of development, and there is still a lot of room for development in the future. In recent years, e-commerce and some catering industry giants have also begun to join the market, their participation will undoubtedly make China’s coffee market more competitive. For example, Amazon China launched an online cafe in August 2015; Coca-Cola launched its first espresso drink “Qiaoya” after acquiring China’s Green Mountain Coffee in February 2014; Master Kong and Starbucks launched a joint venture in March 2015. The Mainland launched instant coffee “Fappuccino”. I believe that more companies will join the coffee market in the future, bringing new competition and challenges to the Chinese coffee market.

  1. The consumption pattern of China’s coffee market has changed

At present, the market development of instant coffee is gradually slowing down, and freshly ground coffee and ready-to-drink coffee occupy more and more market shares. With the increase in the proportion of freshly ground coffee, China’s domestic coffee machine sales are gradually increasing. In addition, ready-to-drink coffee also has development potential that cannot be ignored. Drink giants such as Coca-Cola and Master Kong have launched their own coffee products to meet the needs of fast-paced user groups.

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