Coffee in Colombia

PROSPECTS

A good year for coffee

In 2018, coffee continued displaying solid growth rates, not only at retail stores, which keep broadening their offering with premium brands and origin coffees that attract consumer attention, but also in the foodservice channel – mainly specialist coffee shops that continue with aggressive expansion plans in the country.

Premiumisation trend continues deepening

Demand for high-quality and premium coffees continues to rise, and most companies are orientating their efforts towards developing single-origin coffees and premium lines. Juan Valdez is the brand with more expertise in this regard, with regional and small brands following the trend and increasing presence at modern retailers.

Specialist coffee shops keep expanding

The expansion of specialist coffee shops continues in the country, with traditional brands like Juan Valdez and OMA facing competition from Tostao, a new model of low-priced coffee and bakery products, which was inaugurated in 2015 and currently has 300 stores in the country. This has shaken the playing field in coffee, by broadening the scope of specialist coffee shops to all income segments and thus driving coffee consumption.

COMPETITIVE LANDSCAPE

Colcafé maintains its leadership

Colcafé, belonging to Grupo Nutresa, remains the most important player, with Sello Rojo as its flagship brand, and by developing premium and convenient products such as coffee pods. Juan Valdez, the leading brand in the premium segment, displayed a strong increase in sales, relying on distribution in the modern retailing channel and through its own specialist coffee shops.

Instant coffee following premiumisation trend

The rapid development of instant coffee, which is still dominated by mainstream brands, is becoming interesting for the development of premium lines. Although brands like Buendía and Juan Valdez have long presence in the marketplace, in 2017 Nestlé launched Nescafe Artesano Santuario, followed in 2018 by Nescafe Artesano San Agustin.

Private label witnesses rapid growth rates

Competition between large retailers and discounters continues intensifying, leading to rapid expansion of private label in standard fresh ground and instant coffee. Modern retailers have been adopting pricing strategies to compete with discounter brands that will continue with further expansion, following the path of opening more discounter outlets.

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