August 27, 2020

The Rise Of Instant Coffee

Soluble or instant coffee has seen consistent demand for decades because of its affordability and convenience. In recent years, a number of major coffee companies have invested in it, hoping to pick up some of the market share.

Even through the current challenging global economic situation, instant coffee sales in both the commodity and specialty markets are growing. However, while some consumers believe that it’s possible to create and enjoy quality instant coffee, many consider it to be an inherently low quality beverage.

I spoke to experts about the growth of soluble coffee, and the potential it has to “go specialty”. Read on to find out what they said.

Lee este artículo en español El Aumento Del Consumo de Café Instantáneo

A Brief History Of Instant Coffee

Today, instant coffee accounts for approximately 25% of all retail brewed coffee consumed worldwide. But how did it get there?

Although it was first invented in the 18th century, instant coffee first became popular during the First World War as part of soldiers’ rations. After the First World War, disruptions in the global economy meant that there was a national surplus of coffee across Brazil. Around 1930, Nestlé and the Brazilian Coffee Institute jointly developed an instant coffee, which then became popular during the Second World War.

From then on, its popularity only grew. In the 1960s, freeze-drying was introduced to improve the quality and flavour of instant coffee. Soluble coffee is still freeze-dried today, alongside the other main method, spray-drying.

Today, instant coffee (also referred to as soluble, powder, or crystal) is exported as a final product. It is also much easier to transport than green or roasted beans. It weighs less than whole beans, can withstand harsher conditions, and is often made with affordable robusta instead of arabica. Altogether, it’s a cheap and convenient coffee solution. 

The ICO reports that as of July 2020, soluble coffee shipments accounted for 9.1% of all coffee shipped worldwide – an increase of 1% on the same period last year. The market for soluble coffee is also expected to grow by 4.2% annually until 2024. Europe is the world’s largest soluble coffee consumer with a market share of 37%, followed by China (12%), and the USA (11%). 

According to a Euromonitor report, contemporary demand for instant coffee often comes from developing markets, thanks to its affordability and convenience.

In countries with established specialty coffee markets, there is a “more troubled… category outlook”. However, there is “considerable opportunity [in these countries] if instant coffee’s advantages are leveraged effectively”.

Instant coffee laboratory

You may also like How to Meet The Needs of Today’s Coffee Shop Customer

Instant Coffee Production Today

Brazil is the world’s biggest instant coffee producer and exporter. In the first quarter of 2020, soluble coffee export rates in Brazil grew by around 20%.

Other coffee producing countries are experiencing similarly high growth rates. In 2020, Buencafé, a producer of 100% Colombian freeze-dried coffee, reported its strongest financial first half of the year to date, with sales up 10% compared to the first half of 2019.

Cristina Madriñan is Buencafé’s general manager. She tells me that the drink has risen in popularity in 2020 for being inexpensive and easy to brew, making it accessible during Covid-19. 

She says that even though one of the main reasons behind this growth in revenue was timing, it wasn’t just because of the pandemic. Cristina says there is constant innovation to improve coffee quality in the soluble coffee market.

“New acquisitions, mergers between companies, and the growth in capacity of new facilities around the world suggest [instant coffee’s] sustained growth,” she adds.

The Rise Of High-Quality Instant Coffee

Several major consumer coffee brands have started offering instant coffee to enter this lucrative market. After announcing a partnership in 2018, Starbucks and Nestlé launched a “premium” soluble coffee line in February 2020.

These products are now available in a number of countries, including China, Japan, Australia, Malaysia, Brazil, the UK, and Mexico. In a joint statement, both Starbucks and Nestlé acknowledged the fast growth of the soluble coffee market. 

Kent Sheridan is founder of VOILA Instant Coffee, a US business that produces customised blends for third-party brands. He believes that soluble coffee is a good fit for specialty coffee roasters during the Covid-19 pandemic. Many roasters have moved more towards ecommerce to improve sales. He says growth in the specialty instant market has been significant. 

“I think it’s growing because we’re creating a product worth drinking that accurately represents the coffees sourced,” he says. “Consumers have long been frustrated by having to compromise.”

One of Kent’s clients is Três Marias Coffee Company in the United Arab Emirates. Founder Maria Eduarda Becker Pavani tells me that they launched their soluble coffee line during the pandemic. Maria says she noticed that even though some customers were seeking out specialty coffee, many lacked the knowledge and equipment to prepare it. Their instant coffee line, she says, offers consumers great tasting coffee without the need for extensive brewing knowledge.

The increase in demand for instant coffee could also benefit producers. When the pandemic forced many coffee shops to temporarily close and cancel orders from roasters, many roasters were stuck with a stock of green coffee from the first quarter of 2020. This abundance of stock meant that they couldn’t purchase new imports from producing countries. As a result, many producers have been forced to sell specialty lots at commodity prices.

However, the growth of quality instant among roasters could mean more options for producers who experience difficulties with demand. “Coffee brands want more opportunities for their customers to enjoy their coffees and to reach new consumers with something innovative yet foolproof,” says Kent. He thinks that instant will soon become “one of the default formats that roasters offer their coffees in”. 

What Do People Think?

We reached out to Perfect Daily Grind readers on Instagram, and asked them what they thought of soluble coffee. The reactions were completely mixed. Some people said they were totally against it, while others said that instant coffee had potential as a specialty coffee product. 

However, a lot of readers noted that instant coffee had a place in their lives, allowing them to enjoy coffee when travelling or when short on time. “While it surely does not match a fresh brew, it does suffice for [an] instant cup,” says Sanjeevani Mahajan. Others, however, felt that what they considered to be specialty coffee couldn’t be compared to instant at all.

Maria says this belief needs to change, since specialty soluble coffee will never aim to compete with or replace “the coffee shop experience and a freshly brewed cup”. She explains that specialty instant simply aims to “give the coffee lover the option to have a great cup of coffee when a fresh brewed coffee is not available”.

The market for specialty instant coffee exists and could grow, but it has a poor reputation to contend with. A lot of of specialty coffee drinkers still believe that instant is objectively bad. As well as this, increased costs for specialty instant present a barrier for roasters, as does the higher retail price for consumers. 

To improve outcomes for specialty instant coffee, the market will need to first educate its customers. Kent says that “we need to make coffee more approachable and accessible”. The market is certainly there, and it’s growing, but just how quickly it will be accepted remains to be seen.

Enjoyed this? Then watch VIDEO: How Is Instant Coffee Made?

Photo credits: Buencafé, VOILA, Três Marias Coffee Company

Perfect Daily Grind

Want to read more articles like this? Sign up for our newsletter!