Coffee in Canada

2020 IMPACT

Plummeting on-trade sales due to COVID-19 are offset by off-trade growth

In 2020, the total volume growth rate of coffee has remained similar to that in other years of the review period, with just a slightly higher increase than in the previous year. However, after both the on-trade and off-trade channels saw similar growth rates in 2019, this could not have been further from the truth in 2020.

Polarisation depending on COVID-19 measures on consumers’ incomes

Although coffee has remained on shelves throughout the year, stockpiling led to shortages of certain coffee brands in the first half of the year. There was therefore some experimentation amongst coffee drinkers, as consumers had to purchase another brand because their preferred brand was out of stock.

Strong competition in fresh ground coffee

Keurig Canada has maintained its lead in coffee in off-trade value terms in 2020. It offers a wide range of brands across fresh coffee, but has no presence in instant coffee.

RECOVERY AND OPPORTUNITIES

Slow return to former level of on-trade sales

2021 is forecast to be a year of adjustment for coffee, after the exceptional changes seen in 2020 due to COVID-19. Foodservice outlets are expected to see less disruption to their operations in 2021, and as the virus comes under better control, with vaccines set to be rolled out in this year, restrictions are likely to ease.

Normalisation of off-trade growth expected from 2022

As many consumers return to consumption outside of the home, off-trade sales are forecast to decline strongly in 2021, which will also contribute to the total volume decline expected in this year. Stockpiling will no longer be seen as necessary by consumers, whilst consumers are likely to drink less coffee at home due to more time spent on-the-go.

Switch to convenient and low-priced distribution channels

E commerce has seen an important increase in its sales and share in coffee as a result of the COVID-19 pandemic in 2020. Although its share had already been increasing in the review period, this distribution channel has seen an acceleration of its growth.