Coffee will see increased retail current value sales in 2020, as working from home, social distancing, hospitality closures and the quarantine due to COVID-19 has increased consumers’ time at home and thus the opportunities for home consumption moments. Since 2016, consumption and spending on coffee have gradually increased, largely driven by instant coffee, which has the highest consumption volumes.
Due to travel restrictions, product transfer and difficulty in hiring laborers for harvesting coffee beans, the global coffee production chain was negatively affected in 2020. There were some short-term shortages due to the temporary closure of warehouses, with instant coffee being the most affected.
Romex and Nestlé, two of the largest coffee players, began to advertise coffee as a staple for home consumption, leading to boosted sales in 2020 during the pandemic. Romex is also experimenting with other innovative sales strategies, such as retailing via e-commerce.
Over the forecast period, coffee is expected to record mixed results among different groups of consumers. On the one hand, there will be income reduction amongst much of the population due to rising unemployment and GDP decreases which could translate into lower demand for coffee in terms of volume.
Pre-pandemic, greater purchasing power among Peru’s urban middle class had led to many to engage in a search for “experiences” that they can share via their social media. Photos of high-quality espresso coffees in high-end specialist coffee shops were among the most shared items.
The top player in coffee, Nestlé, is set to remain the leader over the forecast period, due to the ubiquity of its well-known brands and wide distribution network. Its offers do not have greatly differentiated prices between brands, helping to prevent a race to the bottom in price wars.
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Understand the latest market trends and future growth opportunities for the Coffee industry in Peru with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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This report originates from Passport, our Coffee research and analysis database.
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