Coffee in Middle East and Africa

February 2021

Although foodservice sales saw a major decline during 2020, hit by closures in this channel due to Coronavirus (COVID-19), retail sales continued to record healthy growth. Not only were foodservice consumption occasions moving into people’s homes, but coffee drinking in a domestic setting also benefited from many consumers working remotely. Despite COVID-19’s economic impact, coffee drinkers were looking to create a “café-style experience” in their homes, driving growth in products like pods.

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Key Findings

Sales continue growing over 2015-2020

Although GDP was slowing in 2019 and then took a major hit in 2020, due to the measures taken to contain the spread of COVID-19, Saudi Arabia, the biggest coffee market in the region, still recorded dynamic retail value growth in both of these years, with the government’s Saudisation policy strengthening the participation of women in the workforce and increasing disposable incomes for many households, at least prior to 2020. Most of the major countries will join Saudi Arabia in recording positive growth in 2020, with the region showing increasing interest in a number of newer coffee products, including pods and instant mixes, at the same time as maintaining demand for the standard fresh and instant varieties.

Retail sales benefit from foodservice closures in 2020

Although consumers in many countries became more price sensitive due to the economic impact of COVID-19, the pandemic also encouraged greater at-home consumption of coffee in 2020 due to foodservice closures over the course of the year. Grocery retailers tended to remain open, even during lockdowns, meaning that consumer access to coffee products in the retail channel was maintained, even if shoppers were stocking up to avoid frequent trips to physical stores or favouring the e-commerce channel for its home deliveries.

Further healthy growth expected in 2020-2025

Coffee has good prospects for the forecast period in Middle East and Africa, with Saudi Arabia continuing to be the main growth driver. However, Morocco will be seeing more dynamic percentage growth, with sales more than doubling in 2020-2025, as local consumers increase their intake of all types of coffee. HW products are expected to continue developing well, especially in the more developed coffee markets, with decaffeinated and organic variants performing strongly regionally.

Scope
Key findings
Middle East and Africa the most dynamic region in 2015-2020
No COVID-19 blip visible in coffee’s retail sales value growth
Coffee sales growing in most of the region’s countries
Saudi Arabia a major contributor of new sales in 2015-2020
Fresh and instant coffee account for similar levels of new sales
The main impact of COVID-19 has been in the foodservice channel
Modern grocery retailers lead distribution in the Middle East…
…while traditional grocery retailers are still to the fore in Africa
Saudi Arabian market has high levels of fragmentation
Nestlé remains the clear leader in coffee in 2020
Nestlé spreads its sales right across the region
Nespresso cements its place among the top 10 brands
Continued healthy growth expected in 2020-2025
Fresh ground coffee pods will continue to be most dynamic
Algeria: Market Context
Algeria: Competitive and Retail Landscape
Cameroon: Market Context
Cameroon: Competitive and Retail Landscape
Egypt: Market Context
Egypt: Competitive and Retail Landscape
Israel: Market Context
Israel: Competitive and Retail Landscape
Kenya: Market Context
Kenya: Competitive and Retail Landscape
Morocco: Market Context
Morocco: Competitive and Retail Landscape
Nigeria: Market Context
Nigeria: Competitive and Retail Landscape
Saudi Arabia: Market Context
Saudi Arabia: Competitive and Retail Landscape
South Africa: Market Context
South Africa: Competitive and Retail Landscape
Tunisia: Market Context
Tunisia: Competitive and Retail Landscape
United Arab Emirates: Market Context
United Arab Emirates: Competitive and Retail Landscape

Hot Drinks

This is the aggregation of Coffee, Tea, and Other Hot Drinks.

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