Tea remains the most consumed hot drink in China but coffee is making significant inroads, according to an annual market review from insights provider Canadean.
In 2014, Chinese consumers drank 1.28bn kilograms of hot drinks, with tea account for 82% of the total volume. Despite holding a market share of 5.7%, coffee is expected to register compound annual growth of 15.4% between 2014 and 2019. Growth within the tea category is forecast to be lower, at just 5.6% during the same period. This will mean that the share of the hot beverages market dominated by coffee will rise from 5.7% currently to 8.4% in four years’ time. Tea’s share will decline.
According to Canadean, hot coffee is not only the fastest growing in volume, but also in value terms. The Chinese hot coffee market – worth $2.1bn in 2014 – is expected to reach $4.5bn by 2019. This means the value of the Chinese coffee market will increase at a compound rate of 16.5%.
Canadean analyst Kirsty Nolan said: “Although tea is the traditional drink of choice in China, Western coffee culture is taking hold. More Chinese consumers are socialising in sophisticated coffee shops and are trying out the varying tastes and premium nature of coffee.
“Despite consolidation in the Chinese coffee market, consumers are still looking for quality and variety. This means that in due course, the market will open up to smaller brands, offering consumers the quality and exclusivity they are seeking from coffee.”
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