Coffee is the top performer in hot drinks in Saudi Arabia in 2022, closely followed by tea. Coffee and tea benefit from being popular drinks in the Kingdom, being beverages which are offered as part of traditional hospitality and generosity in settings from consumers’ homes to events.
A further boost to coffee came in May 2022, when Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), launched a coffee company to promote the Kingdom’s coffee beans. According to PIF, the new Saudi Coffee Company will provide support to the national coffee industry through the entire supply chain, from bean to cup, and will also play a key role in developing production in the southern Jazan region, home to Coffea Arabica.
Global giant Nestlé SA is the overall leader in hot drinks in the Kingdom, also topping the list in coffee and other hot drinks, whilst another global name, Lipton Tea Factory FZE, leads tea. That said, the ongoing government support of domestic smallholder farmers will give these smaller brands a greater competitive advantage over the forecast period.
Supermarkets and hypermarkets continue to lead distribution in hot drinks and this ongoing channel success is attributed to the ongoing expansion of such outlets, alongside numerous promotional campaigns – such as seen with LuLu’s aforementioned “Year of Saudi Coffee” and “Flavours of Arabia” events.
On-trade sales continue to recover following the reopening of society and foodservice, after the pandemic period of closures and restrictions. Within this, Saudi consumers’ love for coffee will continue to boost growth for specialist coffee shops and cafés, many of which remained front-of-mind for their customers during the period of closures as they switched their strategies to sell their brands online for coffee lovers to brew at home.
Health and wellness trends will inspire new product developments over the forecast period, with a focus on reduced sugar and sugar-free variants. This is due to the sugar tax, which was implemented in December 2019 as a 50% tax on Sugar Sweetened Beverages (SSBs).
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This is the aggregation of Coffee, Tea, and Other Hot Drinks.See All of Our Definitions
This report originates from Passport, our Hot Drinks research and analysis database.
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