Although foodservice sales saw a major decline during 2020, hit by closures in this channel due to Coronavirus (COVID-19), retail sales continued to record healthy growth. Not only were foodservice consumption occasions moving into people’s homes, but coffee drinking in a domestic setting also benefited from many consumers working remotely. Despite COVID-19’s economic impact, coffee drinkers were looking to create a “café-style experience” in their homes, driving growth in products like pods.
This report comes in PPT.
Although GDP was slowing in 2019 and then took a major hit in 2020, due to the measures taken to contain the spread of COVID-19, Saudi Arabia, the biggest coffee market in the region, still recorded dynamic retail value growth in both of these years, with the government’s Saudisation policy strengthening the participation of women in the workforce and increasing disposable incomes for many households, at least prior to 2020. Most of the major countries will join Saudi Arabia in recording positive growth in 2020, with the region showing increasing interest in a number of newer coffee products, including pods and instant mixes, at the same time as maintaining demand for the standard fresh and instant varieties.
Although consumers in many countries became more price sensitive due to the economic impact of COVID-19, the pandemic also encouraged greater at-home consumption of coffee in 2020 due to foodservice closures over the course of the year. Grocery retailers tended to remain open, even during lockdowns, meaning that consumer access to coffee products in the retail channel was maintained, even if shoppers were stocking up to avoid frequent trips to physical stores or favouring the e-commerce channel for its home deliveries.
Coffee has good prospects for the forecast period in Middle East and Africa, with Saudi Arabia continuing to be the main growth driver. However, Morocco will be seeing more dynamic percentage growth, with sales more than doubling in 2020-2025, as local consumers increase their intake of all types of coffee. HW products are expected to continue developing well, especially in the more developed coffee markets, with decaffeinated and organic variants performing strongly regionally.
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