How Have Coffee Companies Helped the Instant Coffee Industry to Expand its Market Share in the Recent Past?

Key Takeaways

• Introduction
• Latest developments in the powdered coffee sector
• The shift to eco-friendly packaging solutions

Coffee has been consumed by people in the Middle East region from as early as 850 CE. In the next few centuries, it was popularized across the entire Islamic world, from where the coffee plant was taken to different regions. For instance, the first European country to be introduced to coffee was Hungary in the 16th century, from where it spread to several countries across Europe. Similarly, Baba Budan, a Sufi saint, is credited with bringing coffee beans to the Indian subcontinent in around the 17th century, who planted it in the hills of Mysore city. Similarly, the first coffee seedlings were planted in the Americas during the 1700s on one of the Caribbean islands. Since then, it has become one of the most consumed brewed beverages across the globe.

Analyzing the reasons behind the growing popularity of instant coffee as a specialty drink

While coffee as a beverage has been consumed since the 9th century CE, the concept of instant coffee is rather new. While coffee compounds were in use in Britain and the US in the 17th – 18th century, the invention of an instantly soluble coffee powder took place in the last decade of the 19th century. Since then, several powdered coffee manufacturing businesses have come up in the instant coffee industry. For instance, Nescafe, an instant coffee brand by Nestle, was launched in 1938 after the patenting of coffee powder.

All these years, coffee has always been considered to be a beverage of inferior quality and which is suitable only for mass consumption. However, in the past few years, with the conscious efforts from coffee companies, coffee’s image has improved from a low-quality beverage to a specialty drink. One major reason behind this change is the technological advancements that have taken place in the industry to enhance the quality of coffee powder. An advanced coffee powder manufacturing process called freeze-drying has been developed recently, in which the brewed coffee is first frozen and is then subjected to a vacuum which removes almost all of the water and moisture present in the coffee. The shelf life of the powdered coffee that is left behind, thus, increases.

Similarly, spray-dried processes have also been refined to improve the pace of coffee production and enhance the taste and texture of coffee powder. Along with this, another major advancement in the instant coffee domain is the emergence of flavored coffee products. In the past few years, coffee manufacturers have launched unique instant coffee flavors such as hazelnut, vanilla, mint chocolate, caramel, strawberry, etc. For instance, in January 2022, Sleepy Owl, a leading powdered coffee manufacturer based in India, announced the expansion of its product portfolio by launching three premium powdered coffee flavors viz., French vanilla, hazelnut, and original. The launch of such flavored coffee products is predicted to help the flavored segment gather an absolute revenue of $13,774.8 million in the 2023-2032 period.

How has sustainable packaging changed the dynamics of the instant coffee industry?

One of the major hurdles in the growth of the powdered coffee sector was the criticism faced by the industry due to its environmentally degrading nature. For years, coffee manufacturers have been delivering their products in plastic pouches or containers which have led to a huge rise in plastic pollution across the globe. To curb this, several companies have changed their packaging solutions to more eco-friendly options like paper pouches, recyclable tins, and glass jars.

For example, in January 2024, Melitta, a German coffee manufacturing company, announced the launch of cone coffee filters and packaging solutions. Made from compostable materials, these coffee filters will help reduce the waste caused by plastic coffee cups drastically. For this product, Melitta received certification from Forest Stewardship Council® (FSC)® and Biodegradable Products Institute® (BPI). The company released a statement saying that the product launch is in line with Melitta’s policy of eco-friendly business approach and sustainable development.

To conclude, the instant coffee sector is expected to witness huge growth in the coming period due to the technological advancements in coffee manufacturing processes. The conscious efforts taken by coffee companies to promote this beverage as a specialty drink have also contributed to the growth of this industry. The shift to sustainable packaging is also estimated to help the market flourish in the years to come.

For insights into how your business can capitalize on the opportunities offered by the industry, feel free to contact us.

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