Report Overview

Saudi Arabia Coffee Market - Industry Trends & Forecast Report, 2029

Saudi Arabia coffee market size was estimated at USD 1,645.15 million in 2022. During the forecast period between 2023 and 2029, the size of Saudi Arabia coffee market is projected to grow at a CAGR of 5.07% reaching a value of USD 2,314.51 million by 2029. Major growth drivers for Saudi Arabia coffee market include a growing demand for innovative flavors and new tastes that complement traditional styles. The surging corporate culture and urbanization has contributed to this trend. The country's increasing café culture has also propelled the Saudi Arabia coffee market forward, with specialty coffee gaining popularity. The Saudi government's Vision 2030 initiative aims to diversify the country's economy and decrease its dependence on oil exports. To promote domestic coffee consumption, the government launched the Year of Saudi Coffee 2022 campaign, with plans to grow higher-quality coffee and export it on a large scale by 2040. Also, the Public Investment Fund has invested in the Saudi Coffee Company and aims to develop academies to train entrepreneurs, coffee plantation owners, and farmers to start their own businesses. Such initiatives are expected to offer lucrative opportunities for the growth of the coffee market in Saudi Arabia during the forecast period.

Saudi Arabia Coffee Market – Overview

Coffee is a popular brewed beverage made from roasted coffee beans, which are the seeds of certain types of coffee fruits. The seeds are separated from the berries and then roasted to produce a consumable product. The growing acceptance of Western culture in Saudi Arabia is due to the rise of the young population and foreign tourism. Arabica is more prevalent in this region, with low caffeine, high fat, and acidity. The central region of the country has the largest share of income due to its larger population, trade offices, and employment opportunities. The presence of famous Haji Places in Mecca and Medina also contributes to the growth of the Saudi Arabia coffee market, as it increases tourist footfall and demand for coffee in cafes. Specialty coffee in Saudi Arabia is also contributing to the market's growth. Coffee shops now roast beans in front of customers and serve the coffee in Dallah, an Arabian coffee pot. Younger and older age groups have varying preferences, with younger people preferring mixed coffee or coffee with milk and flavored syrup, while older people prefer Turkish or espresso. This diversity in preference provides quality and variety in the coffee shops.

Saudi Arabia Coffee Market

Growth Drivers

Increasing Demand for Certified Coffee Products

As consumers become more conscious of the environmental and social impact of their purchasing decisions, there is a rising interest in certified coffee products that ensure fair labor practices and sustainable farming methods. In response, coffee producers and retailers are increasingly offering certified products that cater to this demand. This trend is expected to drive the growth of the Saudi Arabia coffee market in the coming years as more consumers seek out certified coffee products.

Growing Popularity of Single-serve Coffee Brew Systems

The increasing acceptance of single-serve coffee brew systems by consumers is expected to propel the growth of the Saudi Arabia coffee market. Single-serve coffee systems, such as pods or capsules, offer convenience and ease of use, as well as consistent quality and portion control. This appeals to consumers who are looking for a quick and hassle-free coffee experience, whether at home or in the office. As a result, many coffee companies in Saudi Arabia are offering single-serve coffee products to cater to this demand. This trend is expected to continue to drive the growth of the Saudi Arabia coffee market in the future, as more consumers adopt single-serve coffee brew systems as their preferred method of coffee consumption.

Restraints

Rising Cost of Agricultural Input

The growth of the Saudi Arabia coffee market is anticipated to be hindered by the rising cost of agricultural inputs. Coffee production requires a variety of inputs, including labor, fertilizer, pesticides, and equipment. The cost of these inputs has been increasing in recent years, which has put pressure on coffee farmers and producers. This increase in costs can lead to a decrease in profitability for farmers, which can result in lower production levels and decreased supply for the market. In turn, this can lead to higher prices for consumers, which can reduce demand for coffee products. As a result, the rising cost of agricultural inputs is anticipated to impede the growth of the Saudi Arabia coffee market in the coming years.

Impact of COVID-19 on Saudi Arabia Coffee Market

The COVID-19 pandemic caused detrimental impact on various industries in 2020 including the Saudi Arabia coffee market. During Q2 2020, the market suffered a decline in growth due to the closure of retail stores and malls. Furthermore, the supply chain of raw materials was affected by the restrictions on goods transportation that were put in place worldwide. However, in 2021, the market began to recover and is predicted to experience significant growth in the future. This is because coffee sales have been increasing both on e-commerce websites and in physical stores across Saudi Arabia.

Saudi Arabia Coffee Market

Segmental Coverage

Saudi Arabia Coffee Market – By Product

By product, Saudi Arabia coffee market is divided into Whole-bean, Ground Coffee, Instant Coffee, and Coffee Pods & Capsules. The coffee pods and capsules segment holds the highest share in the Saudi Arabia coffee market due to its convenience and ease of use. Coffee pods and capsules are pre-portioned and pre-packaged, making it easy to make a quick cup of coffee without the need for additional equipment, such as a coffee grinder or a coffee maker. This convenience factor has led to an increasing demand for coffee pods and capsules in Saudi Arabia, particularly in settings such as institutions, commercial areas, restaurants, and hospitals, where there is a need for quick and efficient coffee service. Additionally, coffee pods and capsules are available in a wide range of flavors, catering to the diverse taste preferences of consumers in Saudi Arabia.

Saudi Arabia Coffee Market – By Distribution Channel

Based on distribution channel, Saudi Arabia coffee market is bifurcated into On-trade and Off-trade segments. The off-trade segment held a higher share in the Saudi Arabi coffee market. The off-trade channels are easily accessible to consumers, and they offer a wide range of coffee products from varied brands and price points. This accessibility and variety have made it a popular choice among consumers who prefer to buy their coffee products in a convenient and familiar setting. The COVID-19 pandemic has also accelerated the shift towards off-trade channels, as consumers have been more cautious about visiting cafes and restaurants. As a result, they have increasingly relied on off-trade channels to purchase coffee products and enjoy them at home.

Competitive Landscape

Major players operating in Saudi Arabia coffee market include The Kraft Heinz Company, Starbucks Coffee Company, The J. M. Smucker Company, Luigi Lavazza SPA, Nestle SA, The Coca-Cola Company, JAB Holding Company, and Tata Global Beverages. To further enhance their market share, these companies employ various strategies, including mergers and acquisitions, partnerships, joint ventures, license agreements, and new product launches.

Scope of the Report

By Product

• Whole Bean

• Ground Coffee

• Instant Coffee

• Coffee Pods and Capsules

By Distribution Channel

• On-trade

• Off-trade

1. Research Framework
   1. Research Objective
   2. Product Overview
   3. Market Segmentation
2. Executive Summary
3. Saudi Arabia Coffee Market Insights
   1. Industry Value Chain Analysis
   2. DROC Analysis
      1. Growth Drivers
         1. Increasing Demand for Certified Coffee Products
         2. Acceptance of Single-Serve Coffee Brew Systems by the Consumers
      2. Restraints
         1. Rising Cost of Agricultural Input
      3. Opportunities
         1. Growing Demand for R&D Products as a Healthier Option
      4. Challenges
         1. Availability of Substitutes Such as Tea
   3. Technology Advancements/Recent Developments
   4. Regulatory Framework
   5. Porter’s Five Forces Analysis
      1. Bargaining Power of Suppliers
      2. Bargaining Power of Buyers
      3. Threat of New Entrants
      4. Threat of Substitutes
      5. Intensity of Rivalry
4. Saudi Arabia Coffee Market Overview
   1. Market Size & Forecast, 2019–2029
      1. By Value (USD Million)
   2. Market Share & Forecast
      1. By Product
         1. Whole-bean
         2. Ground Coffee
         3. Instant Coffee
         4. Coffee Pods and Capsules
      2. By Distribution Channel
         1. On-trade
         2. Off-trade
            1. Supermarkets/Hypermarkets
            2. Convenience Stores
            3. Specialist Retailers
            4. Others
5. Competitive Landscape
   1. List of Key Players and Their Offerings
   2. Saudi Arabia Coffee Company Market Share Analysis, 2022
   3. Competitive Benchmarking, By Operating Parameters
   4. Key Strategic Developments (Mergers, Acquisitions, Partnerships, etc.)
6. Impact of Covid-19 on Saudi Arabia Coffee Market
7. Company Profile (Company Overview, Financial Matrix, Competitive Landscape, Key Personnel, Key Competitors, Contact Address, Strategic Outlook, SWOT Analysis)
   1. The Kraft Heinz Company
   2. Starbucks Coffee Company
   3. The J. M. Smucker Company
   4. Luigi Lavazza SPA
   5. Nestle SA
   6. The Coca-Cola Company
   7. JAB Holding Company
   8. Tata Global Beverages
   9. Other Prominent Players
8. Key Strategic Recommendations
9. Research Methodology
   1. Qualitative Research
      1.  Primary & Secondary Research
   2.  Quantitative Research
   3.  Market Breakdown & Data Triangulation
      1.  Secondary Research
      2.  Primary Research
   4. Breakdown of Primary Research Respondents, By Region
   5.  Assumptions & Limitations

*Financial information of case of non-listed companies can be provided as per availability.

**The segmentation and the companies are subject to modifications based on in-depth secondary research for the final deliverable.

List of Figures

Figure 1       Saudi Arabia Coffee Segmentation

Figure 2       Saudi Arabia Coffee Market Value Chain Analysis

Figure 3       Company Market Share Analysis, 2022

Figure 4       Saudi Arabia Coffee Market Size, By Value (USD Million), 2019–2029

Figure 5       Saudi Arabia Coffee Market Share, By Product, By Value, 2019–2029

Figure 6       Saudi Arabia Coffee Market Share, By Distribution Channel, By Value, 2019–2029

List of Tables

Table 1        Saudi Arabia Coffee Market Size, By Value (USD Million), 2019–2029

Table 2        Saudi Arabia Coffee Market Size, By Product, By Value, 2019–2029

Table 3        Saudi Arabia Coffee Market Size, By Distribution Channel, By Value, 2019–2029

Table 4        The Kraft Heinz Company Overview

Table 5        The Kraft Heinz Company Financial Overview

Table 6        Starbucks Coffee Company Overview

Table 7        Starbucks Coffee Company Financial Overview

Table 8        The J. M. Smucker Company Overview

Table 9        The J. M. Smucker Company Financial Overview

Table 10      Luigi Lavazza SPA Company Overview

Table 11      Luigi Lavazza SPA Financial Overview

Table 12      Nestle SA Company Overview

Table 13      Nestle SA Financial Overview

Table 14      The Coca-Cola Company Overview

Table 15      The Coca-Cola Company Financial Overview

Table 16      JAB Holding Company Overview

Table 17      JAB Holding Company Financial Overview

Table 18      Tata Global Beverages Company Overview

Table 19      Tata Global Beverages Financial Overview