The Saudi Arabia coffee market is growing at a rapid pace, which is due to the increase in demand for specialty coffee, changing lifestyle of consumers, the rising café culture, and the deep-rooted coffee tradition in the country. Coffee has been consumed for many years in Saudi Arabia. It is grown in small numbers in mountainous ranges of Jazan, Al Baha, and Aseer but is also imported in large amounts into the country due to the rising demand for specialty coffee. Further, younger consumers are looking for innovative coffee flavors and organic blends, opening new opportunities in the coffee market in the country.
The country's retail infrastructure has significantly evolved, and consumers can choose coffee among various brands available at offline and online stores. Hence, the high availability of international and domestic coffee brands across multiple retail channels propels the consumption of coffee. Thus, the increasing consumption of coffee is expected to drive the Saudi Arabia coffee market growth during the forecast period.
Many industries suffered heavy losses during 2020 due to the COVID-19 pandemic. Similarly, the Saudi Arabia coffee market witnessed a decline in growth due to the shutdown of retail stores and malls during Q2 2020. Also, the supply chain of raw materials was disrupted due to the restrictions on goods transportation during the worldwide lockdown. However, in 2021, the market started to gain momentum and is expected to witness significant growth in the coming years due to the increasing sales of coffee on e-commerce websites and offline stores across the country.
Market Insights
Saudi Arabian consumers are shifting toward specialty coffee from traditional or instant coffee. The preference for specialty coffee is increasing due to the high influence of western culture and the presence of consumers with high per capita income. The number of specialty coffee vendors and roasters is increasing rapidly in the country. According to Almohanad Almarwai, the co-founder and the CEO of the Arabian Coffee Institute, Saudi Arabian consumers prefer lighter roasts of specialty coffee than consumers in other Middle Eastern countries. It provided high exposure to specialty coffee vendors and created consumers' awareness of specialty coffee. Thus, the rising demand for specialty coffee in the country fuels Saudi Arabia coffee market growth.
Based on product type, the Saudi Arabia coffee market is segmented into beans, capsules, powder and instant coffee, and others. The capsules segment is anticipated to register the highest CAGR during the forecast period as it is one of the latest innovations for brewing coffee and espresso. The increasing demand for coffee machines in institutions, commercial areas, restaurants, and hospitals is boosting the growth of Saudi Arabia coffee market for the coffee capsule segment.
Based on category, the Saudi Arabia coffee market is segmented into organic and conventional. The market for the organic segment is expected to grow at the fastest rate during the forecast period due to the rising customer demand for premium quality and natural products in the country.
Based on distribution channel, the Saudi Arabia coffee market is segmented into supermarkets and hypermarkets, specialty stores, online retail, and others. The specialty stores segment held the largest market share in 2020. However, the online retail segment is anticipated to register the highest CAGR in the coming years due to consumers' buying behavior during the COVID-19 pandemic. The pandemic has shifted customers' preference to buy from e-commerce websites than conventional stores to maintain safety.
| Report Attribute | Details |
|---|---|
| Market size in 2021 | US$ 1,575.52 Million |
| Market Size by 2028 | US$ 2,220.70 Million |
| Global CAGR (2021 - 2028) | 5.1% |
| Historical Data | 2019-2020 |
| Forecast period | 2022-2028 |
| Segments Covered |
By Product Type
|
| Regions and Countries Covered | Saudi Arabia
|
| Market leaders and key company profiles |