Europe Coffee Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Market Overview

The Europe coffee market was valued at USD 42.62 billion in 2020 and it is projected to register a CAGR of 3.96% during the forecast period, 2021-2026.

As a consequence of the COVID-19 pandemic, European governments have put measures like social distancing and lockdowns in place. These have had a huge effect on cafés, micro-roasters, restaurants, and other out-of-home outlets. Owing to this factor, the demand for coffee products such as instant coffee and ground coffee has moved to off-trade, which has resulted in enhanced coffee sales in the retail sector. Moreover, since consumers have restored to in-house coffee consumption, there has been an increase in demand for different types of coffee in the region studied.

The European coffee market is driven by multiple factors like the increasing demand for certified coffee products, acceptance of single-serve coffee brew systems by consumers, and constant innovation led by the top players in the coffee market. However, the changing weather conditions play a crucial role in coffee production in countries where production takes place, thus affecting the supply chain for coffee being imported into the European countries.​

The premiumization of whole bean coffee products is driving the coffee market. Major players of the market are trying their best to introduce premium products by utilizing artisanal techniques or using the handpick method to get a premium product, which is increasing the demand. ​

Germany and Spain are the largest coffee-consuming nations of organic and conventional coffee in Europe. Germany is also a major importer of organic coffee in Europe.

Scope of the Report

Coffee is a brewed drink prepared from roasted coffee beans, the seeds of berries from certain coffee species. By product type, the market is segmented into whole bean, ground coffee, instant coffee, and coffee pods and capsules.​ By distribution channel, the market is segmented into on-trade and off-trade distribution channels​. The off-trade channel is further segmented into convenience stores, specialist retailers, supermarkets/hypermarkets, and other distribution channels. By geography, the market studied is segmented into France, Germany, United Kingdom, Spain, Italy, Russia, and the Rest of Europe. For each segment, the market sizing and forecasts have been done on the basis of value (in USD billion).

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Key Market Trends

Consumer Preference for Premium Coffee Fuels Growth in Specialty Coffee Shops Market

The sharp growth in the premium coffees market has been partly driven by the continuous growth of out-of-home consumption. The coffee shops in European countries are leading the way by introducing sophisticated, high-value varieties to consumers, thereby boosting market growth significantly.

The growing demand for premium coffee is in line with growing consumer interest in how the coffee is brewed, as well as how the crop is grown. It has, therefore, become essential for speciality coffee producers to tell the story behind their coffee, its origin, and its other environmental and social aspects.

In recent years, coffee in the United Kingdom became reliant on coffee shop-driven premiumization. Consumers who had been witnessing rising incomes over the last decade, learned about value-added approaches to coffee at coffee shops. Thus, there was increased appreciation for premium coffee in other foodservice and retail occasions.

The increasing interest in premium coffee is reflected in the growing number of coffee bars and chains, small roasters, small local brands, and baristas across the European region. As per the Centerfor the Promotion of Imports (Europe), the European branded coffee shop market grew by 3.4% in 2019, reaching a total of nearly 38,000 outlets. In 2019, the leading branded coffee shops in Europe were Costa Coffee, Starbucks, and McCafé, with market shares of 8.4%, 7.4%, and 6.8%, respectively. While these large-scale companies do not always offer speciality coffee products, they set a consumer trend for coffee shops and other out-of-home purchases. This consumer trend spills over to smaller and more specialized coffee shops offering high-quality/speciality coffees, thus, indicating potential market growth of the category during the forecast period.

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