The Camellia sinensis plant, from which matcha originates, was first cultivated for use in tea in China in the 3rd century BCE, but it wasn’t until the 7th to 10th centuries that the practice of consuming the leaves in the form of matcha was first documented. Matcha, unlike the infusion process of its black and green tea sisters, is made by finely grinding the tea leaves into a powder that is mixed with hot water and consumed in its entirety. It is thought that a Japanese Buddhist monk brought matcha to Japan
sometime around the 12th century, where it was considered highly valuable and coveted and therefore necessitated a careful preparation method, and so its consumption and preparation developed into a spiritual practice by the 16th century, the whisking of powdered green tea into hot water a meditative ritual. Since matcha began as a rare and premium product, the ceremony of its preparation became
entrenched in its consumption. In modern day Japan, matcha tea ceremonies are still widely practiced, and while it is no longer reserved for the elite or ‘ruling class’, it is still deeply ritualistic with specific implements such as the bowl and bamboo whisk, and even particular whisking motions or patterns.
Meanwhile, elsewhere in Japan, the matcha latte has become extremely popular, commercialised
and readily available, and co-existing alongside its traditional consumption in the country.

Matcha Migrates West

Western countries have long since been discovering and adopting Japanese culture and cuisine, and matcha is no different, with it seeing a marked rise, particularly in the US. Future Market Insights (FMI) reports that the matcha market in 2023 was worth USD $2.7 billion and is expected to reach $7.1 billion by 2033 — a CAGR of 10.2 percent. FMI attributes this growth to the interest in its health benefits, use in skincare and culinary applications such as confectionery. The latter of which is driving
its popularity in the Indian market, according to Fact MR , while the health benefits are driving the market in the US.

Japanese tea company, Ippodo, was founded in 1717, “when the [matcha] tea ceremony had begun to be enjoyed by other elites like warrior families and high-class townsfolk,” said Tomoko Honda, head of global operations, Ippodo. In 2001,Ippodo began selling its matcha overseas as the number of international visitors to its Kyoto shop had begun to increase.

The growing interest in matcha was also noted by Germany-based tea supplier, Wollenhaupt, which had previously only been including matcha in its catalogue as a ‘marginal phenomenon’, said Marco Sinram, head of tea trading and sustainability, Wollenhaupt, but recognised that demand was developing ‘dynamically’, and therefore now offer three different types of matcha to its customers.

“Ten years ago, very few people had heard of matcha and now the market is absolutely exploding. So many new matcha brands have popped up in the last couple of years and you can find matcha on menus in more cafés and restaurants. The UK is now following in the steps of places like New York and Los Angeles with matcha bars popping up across the country,” said Katherine Swift, founder and CEO
of OMGTea, a UK-based specialist matcha green tea company.

One such place is Blank Street coffee chain, which began in Brooklyn, New York, in August 2020, and now has locations across New York; Boston, Massachusetts; Washington, DC; and in 2022 debuted in London. While Blank Street serves an array of café and coffee shop offerings, some of its most distinguishable and popular products are its matcha beverages.

When Blank Street launched in London in Summer 2022 ,matcha wasn’t a widely accessible drink. There were limited places to get matcha on the high street, but most of those places offered either expensive or low-quality matcha. We wanted to disrupt the market by launching exciting flavour combinations that made a niche category into one that is more fun and accessible for everyone,” explained Ignacio Llado, UK managing director at Blank Street. “In Spring of 2023 we launched our Blueberry Matcha, joining the classic Matcha Latte on our menu. This drink was the first of its kind in London, and […] immediately caused a huge buzz, with TikTok and word of mouth helping it to quickly climb to become a Blank Street best seller.”

Matcha’s vibrant green colour affords it a social-media-ready aesthetic for consumers, fuelling its popularity among influencers and the younger generation. Blank Street has recognised this in its marketing strategy, making use of clear cups and contrasting colours to bring its matcha drinks to life.

While many of the high-street iterations of matcha lattes and frappés may be heavy on sugar or cream, matcha itself is considered a remarkable health food, with this being another, perhaps the largest, draw to the product for consumers. “Matcha aligns well with overall wellness trends and appeals to those looking for more specific benefits such as a healthier alternative to coffee or energy drinks, detox,
increased antioxidant intake, weight management, etc,” said Swift.

A Healthy Shade of Green

The way in which the Camellia sinensis plant is grown in order to produce matcha, allows for the accumulation of catechins, (−)-epigallocatechin-3 -gallate (EGCG) in particular is most abundant in matcha. It is these catechins that provide high antioxidant properties and give matcha its reputation as a health drink. It has been found that “regular consumption of matcha may have a positive effect on both physical and mental health,” according to the report Health Benefits and Chemical Composition of Matcha and Green Tea: A Review by Joanna Kochman, Karolina Jakubczyk, Justyna Antoniewicz, Honorata Mruk, and Katarzyna Janda, published on PubMed Central.

It is the health benefits of these antioxidants found in matcha that encouraged Swift to establish OMGTea. She began researching its benefits after her mother was diagnosed with breast cancer, then both she and her mother began routinely drinking matcha green tea. Five years later, Swift launched OMGTea, and a year after that she founded The Healthy Life Foundation, a charity that funds research into age-related diseases, including cancer.

Swift emphasised, however, that the quality of the matcha consumed is essential to reaping its health
benefits. While matcha is generally considered a premium product, there are more affordable blends
available; these are the kind often used as ingredients in confectionery or desserts where the matcha taste need not be so refined. Matcha can be tested for its quality by examining the colour and texture, as well as the taste. She explained that they quality check their matcha regularly using the ‘finger/stroke test’, whereby matcha powder is placed on a white piece of paper and, using a finger, is pulled across the page to observe its colour and texture alongside others. The brighter the green colour, the higher quality the matcha, also the particle size of high-grade matcha ought to be between five and ten microns, as fine as baby powder, said Swift.

This essential colour and texture gauge all comes from the farming process, which has specific methods to ensure these attributes. “For around three weeks before harvest, shades are put over the tea fields to block out the sunlight, which increases the amount of flavourful, umami-rich components in the tea leaves. After the leaves are harvested in the beginning of May, the leaves are steamed, cooled and dried, baked, and sorted. […] The leaves are then ground with stone mills to produce the fine powder called matcha,” explained Honda. Shading the tea leaves is a traditional characteristic of matcha production, and is a method invented centuries ago in Kyoto, Uji, Japan, and is now widespread, she noted.

It is the shading that boosts the leaves nutrient levels, causing an overproduction of chlorophyll, contributing to its bright green colour, added Swift. The stone mills are also what produce the silky, fine texture of quality matcha, whereas lower grades are cut and blended using steel, which, she noted, reduces the flavour and bio availability of the matcha’s nutrients.

The location where the matcha is grown is also crucial to its quality and flavour. There are specific areas that are known for their matcha production, such Uji, Japan, “one of the most renowned regions for matcha growing in the world,” said Llado, and it is around this area that Wollenhaupt, Blank Street and Ippodo source their matcha. The region of Kagoshima, Japan, is also particularly suited to matcha production, benefitting from its volcanic soil and climate, commented Swift, and is where OMGTea sources its products.

Sustaining Production

With such specific regions and fastidious productions techniques, are matcha’s producers prepared to meet the surging global demand from the product, not just domestically in Japan, but as far away as the US and UK? Sinram explained that, while Wollenhaupt believes that the highest and most authentic quality of matcha can be found only in Japan, it is possible to source it from other producing countries,
depending on the requirements of the customer.

Meanwhile, Swift noted that in the Kagoshima region, practices are being undertaken to increase production in order to meet demand, “Farmers in Kagoshima have been adopting advanced agricultural techniques to enhance matcha. These innovations help increase yield and improve the quality of the tea leaves. Some tea farms are converting or expanding their fields specifically for the cultivation of tencha, the raw material used to make matcha. Local government initiatives and support for the tea industry have also played a role in encouraging the growth of matcha production in the region.”

Honda added that as global climates change, areas that are suitable for production are shifting and will continue to shift. “Areas where tea can be grown will likely change or expand as well, whether inside or outside of Japan. We are not sure what the future will bring, but it is key to plan for and adapt to changes.”

This growth in demand has created a broad market for matcha with varying requirements and uses. Where it has historically and traditionally been an exceptionally premium and ceremony-bound product, it is now a commercialised and accessible product for many consumers, posing the question of how far it can be removed from its origins and cultural significance? “While it’s great that matcha is going more mainstream, we want to make sure that it still feels special and comes with the holistic experience that has been central to Blank Street since we first launched,” noted Llado.

So where perhaps the ceremonial aspect of matcha may no longer be a necessity, it still can add something to the experience of consumers, if they engage with it, encouraging more mindful consumption, said Swift.

Honda added that, while consumers may not know of its ceremonial or spiritual origins, “during the tea ceremony and in Japanese society in general, when drinking matcha it is considered important to feel gratitude for the person who made the matcha for you and for those who produced it. We think it would be wonderful if that sentiment grew alongside the increasing popularity of matcha worldwide.” Therefore, its marketing is crucial, to not only offer consumers a brightly coloured health drink, but also a moment of reflection on both the beverage and the process that went into every sip.

• Kathryn Brand is an associate editor with T&CTJ, while still writing for several of Bell’s
  other magazines. She joined Bell Publishing at the beginning of 2022 after graduating from
  the University of East Anglia with a degree in English Literature and Creative Writing.

The post Ceremonial to TikTok Trending: The Evolution of Matcha appeared first on Tea & Coffee Trade Journal.

Depending who and where you ask, kombucha ranges from a niche beverage that people have heard of but do not know what it is, to a beverage and lifestyle staple. However, there is no argument that, globally, it is a growing category, situated in the ready-to-drink (RTD) tea market, which is also growing. This growth is driven by four macro trends, according to London-based Momo Kombucha’s co-founder, Josh Puddle, which are “gut health, low sugar, alcohol alternatives and vegetarianism/veganism.”

Consisting of fermented tea, using a live culture of bacteria, known as a SCOBY (symbiotic culture of bacteria and yeast), fruit flavours are often then added to create a naturally low-sugar, lightly sparkling probiotic drink, sometimes with a naturally occurring ABV of around 0.5 per cent, however many manufacturers remove this alcohol content to bypass possible restrictions.

Thought to originate in China, one of the largest markets for kombucha is currently the United States. A 2015 Mintel report found that nearly one quarter of US consumers were drinking kombucha, half of which were aged 25-34. However, the market has grown significantly since then so the figures are now likely higher — and it is still growing. Future Market Insights Kombucha Market Outlook report forecasts kombucha to globally experience a CAGR of 17.4 percent from 2022 to 2033, or a rise from USD $3.4 billion to $17.1 billion.

The US is one of the most developed kombucha markets, and therefore is experiencing innovation in the category, such as Caffe Luxxe’s coffee kombucha, brewed from the company’s own coffee as a base rather than tea, to “provide the energising effects of coffee in combination with the probiotic benefit of kombucha,” said Gary Chau, co-founder of south California-based Caffe Luxxe. Kombucha is highly popular among Californians, which Chau credits to the regional trend of lifestyle wellness and holistic health.

California was also the host state of Kombucha Kon, which saw its third annual installment in April. This conference and expo is targeted specifically at the kombucha industry, offering networking across the kombucha supply chain. “Medium-large and better-distributed US brands were represented, including Brew Dr., Bambucha, Flying Embers and Local Roots,” commented Jason Walker, marketing director of Firsd Tea North America, who attended the conference.

Where the US market is reaching maturity, in Europe, in particular the UK, whilst showing strength, the category is still establishing itself and growing its popularity base, with companies mostly trying to make themselves known and educate consumers on what kombucha is and the health benefits it offers, since this is what draws most consumers to the products, and then draws them back. One company already has an advantage in this respect; Yorkshire Tea, a household name in the UK for everyday black tea, is launching a line of kombucha in collaboration with kombucha brand, HOLOS Kombucha, brewed from its own tea. It is still in its trial phase and not yet available to consumers, however, attendees  at the London Coffee Festival, which took place in April, were able to sample the new line. Several other kombucha companies also exhibited at the annual event.

Millennials drive category growth

Kombucha is heralded as the ultimate functional beverage, serving as a probiotic, which contains live microorganisms intended to contribute to healthy levels of good bacteria in the gut, supporting digestion and boosting immunity. Kombucha companies are tapping into the wellness trend that strengthened during the Covid-19 pandemic, and offering a healthy, alcohol-free beverage that also tastes good.

Momo’s Puddle said that the main consumer demographic of its kombucha are millennials, primarily 25 to 45 year olds, which concurs with Fact.MR’s report detailing millennial’s rising adoption of bottled tea. However Caffe Luxxe’s Chau shared that its kombucha is sold generally to those “interested in an overall health and wellness lifestyle.”

That statement is supported by Anna Dominey, UK general manager at Remedy Drinks, an Australia-based kombucha company that dominates in its origin country as well as in the UK market, who says that it appeals to “those who are rejecting processed foods and drinks in favour of more natural alternatives and by those who are looking to cut down on alcohol or drink more mindfully.”

It is evident that the main driver of the kombucha category is its health benefits as well as the offering of an alcohol alternative. “Around 20 per cent of Remedy is consumed in the evening, suggesting consumers are enjoying it as a tasty and satisfying alternative to alcohol,” commented Dominey, further indicating the growing partnership between the low and no alcohol trend, and the functional/wellness beverage trend.

Beverage companies are tapping into this demand, according to Puddle, “more brands are creating products specifically for this segment, eg, kombucha in champagne-style and beer-style bottles.” An example of this is Mighty Brew, which, alongside its core range which retails at a price point of approximately £5.66 (USD $7.08) for 750ml, it offers a more premium ‘Heritage’ format at approximately £11.00 ($13.76) for 750ml which is housed in a champagne-style bottle, complete with cork and cage. Mighty Brew’s Heritage range is marketing itself as an alternative to alcoholic bubbly beverages at celebratory occasions.

Tapping into current trends

This functional/wellness and low and no category overlaps significantly with those incentivised by sustainability claims, therefore, most kombucha brands cite accolades accordingly, such as Momo achieving certified organic and B Corp status. Further, Remedy endeavours to source high quality, all natural ingredients; “This was the way Sarah and Emmet [Remedy’s founders] did it when they started on the kitchen counter, and they still take an active role in sourcing the best ingredients from trusted suppliers,” revealed Dominey. “We know where every single ingredient in our drinks comes from, right down to even our live culture,” she continued. Similarly, Caffe Luxxe builds sustainable relationships with its coffee farmer partners to provide consistent and fair prices.

Looking ahead, Future Market Insights (FMI) Kombucha Market Outlook report finds that it is “unlikely that consumer demand for fermented goods may decline anytime soon,” with the millennial generation’s focus on healthy eating fuelling the demand. However, to increase its consumer base, the kombucha market needs to actively promote its health benefits to attract the older consumer, as well as work on becoming more cost-effective, as it currently sits in the more premium category in most markets. FMI’s report also details that the category can take advantage of novel flavours to attract consumers and tap into the increasingly adventurous flavour palates of the consumer.

• Kathryn Brand is an associate editor on T&CTJ, while still writing for several of Bell’s other magazines. She joined Bell Publishing as an editorial assistant at the beginning of 2022 after graduating from the University of East Anglia with a degree in English Literature and Creative Writing. She may be reached at: kathryn@bellpublishing.com.

The post Kombucha eyes growth in new markets appeared first on Tea & Coffee Trade Journal.

According to Fact.MR, the market is expected to grow on the heels of increased adoption by consumers and heightened penetration of booster beverages on supermarket aisles. Furthermore, booster beverages received a lot of public attention during and after the Covid-19 outbreak given their immunity-boosting characteristics. For a long period and for many, tea and coffee were the most preferred refreshment beverages, however, the availability of instant energy-providing beverages was fairly limited until recently. Booster beverages, especially energy boosters, historically, were more often consumed by athletes or active health enthusiasts only. 

The last few years the booster beverage industry has evolved significantly because of extensive product offerings at an affordable cost by manufacturers. Fact.MR reports that the shift in global preferences towards a healthier lifestyle and fitness standards set under the umbrella of spreading use of social media has accelerated product adoption among the general population. Booster beverages have several advantages over traditional drinks, which has led to an increase in demand for the products. For example, booster beverages functionally aid health by either boosting energy or immunity, or improvising skin, hair, or digestion. These applications are further diversifying with ingredients such as caffeine, stimulants, ginseng, pre/pro-bionics, vitamins, and minerals, to name just a few. 

Additionally, the market is being driven by the increasing consumption of booster drinks among teenagers (Gen Z) and young adults below the age of 35 (Gen Z & millennials) who tend to be more health-conscious and fitness-obsessed. Fact.MR notes that because of their ability to improve performance, endurance, and alertness, booster drinks are replacing coffee and tea in the aforementioned age group. 

Fact.MR further finds that the booster beverage market will grow during the forecast period because of factors such as gradually increasing per capita disposable income of the population, increasing population density, expanding variety of flavours in ready-to-drink (RTD) boosters (which is already quite extensive), and a rise in health consciousness at individual levels. Additionally, there is increasing availability of natural and organic ingredients in booster beverages, which has further enhanced booster drink sales. 

Fact.MR’s research also shows: 

• An increase in personal health awareness among the population and the incorporation of various nutritional contents in the products offered will substantially intensify the demand for booster drinks in the short-term period. 
• Sales of booster beverages are projected to grow in the long-term period due to the increasing integration of plant-based raw ingredients such as matcha, cascara, and guarana in product offerings owing to their fruity taste and health benefits. 

• A rise in per capita spending on food and beverages in developing geographies such as East Asia, South Asia, and Latin America will provide lucrative growth opportunities for market players. 

While there is reason for coffee and tea brands to be concerned about the impact of booster beverages, it’s not all rosy for that market. Excessive consumption of booster beverages can be harmful to one’s health. Several booster beverages contain a high amount of caffeine and preservatives, and over-consumption can lead to serious medical problems such as hyperacidity, hypertension, and an increase in heart rate. 

Moreover, Fact.MR’s research notes that caffeine addiction is another side effect of a disproportionate intake of these beverages, which can lead to insomnia, anxiety and dehydration. Hence, the growth of the booster beverage market may be dented due to the aforementioned adverse health effects. So, while coffee and tea brands should be keenly watching the booster beverage market, they should be optimistic yet remain innovative and opportunistic. 

Call me a traditionalist, but I plan to stay with the ‘tried and true’ caffeine boosters — coffee and tea. In fact, I have just enough of a tasty holiday blend left for a couple more cups of coffee… 

Happy coffee and tea sipping in 2023 and best wishes for a healthy and joyous new year! 

• Vanessa L Facenda, editor, Tea & Coffee Trade Journal.
  Keep in touch via email: vanessa@bellpublishing.com Twitter: @TCTradeJournal or LinkedIn: Tea & Coffee Trade Journal

The post Should coffee and tea brands be wary of booster beverages? appeared first on Tea & Coffee Trade Journal.

According to the International Coffee Council, consumer preference in South and East Asia is changing with favourable demand for the consumption of fresh coffee. This increasing demand for fresh coffee in countries in the Asia Pacific are significantly contributing to the increasing coffee consumption.

Key Challenges/Restraints to Coffee Roaster Industry Growth

The low shelf- life of roasted coffee acts as a major restraint for the coffee roasters market, as it loses flavour due to the onset of staleness. Furthermore, increased and extensive usage of instant coffee powder hinders the global market. This is primarily because instant coffee powder reduces the time needed for roasting and grinding.

Other challenges faced by the coffee roasters market include emission of toxic gases and particulate matter during the roasting process along with high consumption of tea in major parts of the world.

Competitive Landscape

Key players in the global coffee roaster market include US Roaster Corp., Coffee Holding Company Inc., Behmor Inc., Hottop, and Giesen Coffee Roasters. Some of the recent developments in coffee roaster market are:

• In March 2022, Breville Group Ltd. launched beanz.com, an e-commerce platform featuring around 50 specialty coffee roasters for residential use.
• In December 2021, Starbucks introduced its new oat dairy alternative coffee in its espresso segment. It includes three combinations of flavors, Vanilla & Strawberry, Hazelnut & Honey, and Dark Cocoa & Orange, which are uniquely handcrafted to enhance a distinctive flavor. It also announced its plan to not charge extra for dairy-alternative products from January 2022.
• In September 2021, Nespresso of Nestle SA launched its coffee roasting machine “Roasterlier.” It aims to provide the most reasonable coffee roasting solutions for HoReCa entrepreneurs across the world, starting with Europe. The machine is customizable to prepare Arabica coffees in a sustainable way.

These insights are based on a report on Coffee Roaster Market by Fact.MR.

The post Fact.MR anticipates growth in the coffee market over the next decade appeared first on Tea & Coffee Trade Journal.

The coffee market in the Nordic region, which is comprised of Sweden, Finland, Iceland, Norway, and Denmark, is steadily growing due to the traditional love local customers have for coffee. And as Covid restrictions in the region are easing, representatives of some leading local producers and independent analysts report that out-of-home consumption is growing again.

While the pandemic and its consequences have not resulted in a significant drop of coffee consumption in the Nordic region – of which each country is among the top-10 coffee-consuming nations in the world – it led to the change of structure of demand.

Such a trend, for example, is currently observed in Denmark, which is confirmed by some leading market research firm analysts.

“No negative effects have been noted, but a shift in demand has occurred. We’ve seen office spaces close, sending many home to work. This meant a decline in demand from B2B customers and an increase in B2C demand. The consumption was moved home from work,” said Christian Juul Andersen, chairperson of SCA Denmark, the Danish Coffee Association, in an exclusive interview. “Specialty coffee is becoming more sought after, as customers are becoming increasingly aware of all links in the supply chain are being treated fair, as well as a general heightened focus on higher quality. We at the SCA expect a shift from a high intake of inferior coffee to a higher quality coffee and a small decrease in consumption.”

In the meantime, in neighbouring Norway, the Covid outbreak has even led to growth of coffee consumption among local customers. Bjørn Grydeland, an official spokesperson of the Norwegian Coffee Association, said, “We have had a total growth in coffee consumption. The decline in the professional market (out-of-home) because of the pandemic has been more than compensated by the growth in the home market.”

According to Grydeland, coffee habits of Norwegians, however, do not change that quickly. “I cannot point to a particular segment that stands out. All kinds of coffee for the home market increased, both instant, capsules and roasted fresh coffee,” he explained. “When society returns to normal conditions, I think we will also return to the way we consumed coffee before March 2020. It is difficult to say whether this exceptional year will lead to lasting changes. Black filter coffee has for decades been our favourite. There is one trend that seems to last; sale of whole beans has been increasing continuously for several years. That will probably continue.”

The Finnish love their coffee

Representatives for roasters also confirm maintaining stable demand for coffee in the region, which creates conditions for their further development. Lenita Ingelin, senior vice-president of Paulig Business Area Finland & Baltics, said 2020 was an extraordinary year – especially in the HoReCa channel – due to the Covid-19 pandemic.

In Finland and the Baltics, the total coffee sales were slightly below the previous year. “However, during 2020 people were experimenting with new coffee tastes that had a positive effect on the sales of our premium coffee segment,” said Ingelin. “In Finland, our City [Coffee] product range, where each blend of coffee represents the coffee culture of a certain city, saw the most significant increase in sales — not being able to travel meant that customers bought 68 per cent more coffee in terms of the various ‘City’ blends than in 2019.”

Paulig Juhla Mokka, a light-roasted coffee, has been popular in Finland since it was introduced in 1929.

Paulig is especially optimistic for its traditional Juhla Mokka coffee — the light roasted ground coffee, launched in Finland for the first time in 1929, and its popularity and consumption have significantly increased since that time. According to Ingelin, today, almost every other cup of coffee enjoyed in the country is Juhla Mokka coffee.

She added that also last year, the iconic Presidentti coffee celebrated the 70^th anniversary of the coffee ambassador, a tradition of Paulig in which the company selects special ambassadors annually to promote the brand. This tradition dates back to the 1920s.

Furthermore, a new variety for the City Coffee range, Café Reykjavik, was introduced in Finland and Estonia, and Classic Cremoso in the Baltics. “In 2020, we also opened a Paulig Café & Store (a Paulig flagship coffeehouse) in Moscow, Russia. It´s a unique place for coffee lovers, inspired by the Finnish Paulig Kulma, which opened in in the heart of Helsinki five years ago,” said Ingelin. “At the moment, we don’t have any expansion plans in our coffee category. We’ll focus on our current markets and nurture the coffee culture in the Baltics, Finland and other Nordic states.”

Paulig Presidentti coffee brand celebrated the 70th anniversary of its ‘coffee ambassador’ in 2020.

Ingelin confirmed that Finland is an important market for Paulig as its coffee culture is one-of-a-kind, and the Finnish people consume the most coffee in the world per capita. She noted that Finnish coffee consumption is almost 10 kg per person yearly and the figure has been stable for years. In 2020, the consumption declined slightly due to exceptional times. The drop in consumption in the HoReCa channels did not shift fully to the retail channel.

Market analysts confirmed these statements. Sneha Varghese, senior research consultant at Fact MR shared that as with many countries, Covid-19 has had a negative impact on the coffee industry of the Nordic region. “As an immediate response to Covid, various government bodies of the region have introduced country-wide risk management services such as social distancing, travel restrictions, and partially lockdown in various countries. This has significantly impacted the countries’ economies and their coffee industry.”

According to Varghese, there was a disruption in various activities such as labour supply, trade operations, logistics networks as well as import-export infrastructure, which has resulted in shipment delay and transaction costs in the coffee industry of the Nordic region. “Thus, the price of coffee has been highly volatile due to disruptions in the supply chain and the production of coffee. This also affects small-scale coffee roasters that primarily supply hotels, restaurants, and cafés. Moreover, Finland, Sweden, and Norway are predicted to remain the most lucrative markets by the end of 202.

Echoing Ingelin’s comment, Varghese said that based on per-capita consumption of coffee, Finland is the biggest consumer across the globe. “The per capita consumption of coffee in Finland is around 12 kilograms. On the other side, per capita consumption of coffee Norway and Iceland is 9.9 kilograms and nine kilograms, respectively. In addition, the consumption of coffee at home has been increased as people restricted to work from home and has limited options to go outside, consume coffee is one of the few ways for them to take a break from work.”

According to a study of the Centre for the Promotion of Imports from developing countries (CBI), which is affiliated with the Netherlands Ministry of Foreign Affairs, imports traditionally account a small share of the Nordic coffee market (especially compared to other European countries), considering that most coffee is packed and produced at local processing factories.

In Denmark, Sweden and Norway coffee is predominantly consumed black, meaning without milk and sugar, so the quality of the actual coffee is especially important in these markets.

CBI analysts point out that coffee in Scandinavia is generally considered to be of high quality, which despite the pandemic, creates conditions for the development coffee chains and micro-roasteries, with the biggest number being observed in Sweden and Denmark.

Paulig achieved Carbon Neutral certification for its roastery in Vuosaari, Finland and aims to make all its production sites carbon neutral by the end of 2023.

In recent years, local coffee roasters and global majors operating in the region have started to pay greater attention to the issues of sustainability. For example, according to Ingelin, Paulig achieved CarbonNeutral® building certification for its Vuosaari coffee roastery. “Our ambition is to reduce the greenhouse gas emissions from our own operations by 80 percent by 2030, and the plan is to make all of our production sites carbon neutral by the end of 2023. Paulig has been a pioneer in the coffee industry’s sustainability work. As one of the few large roasteries in the world, the company uses coffee beans from only verified sustainable sources.”

Specialty tea on the rise

In addition to coffee, the demand for tea in the Nordic region remains also strong, with the biggest being observed in case of specialty teas.

Alexis Kaae, an official spokesperson of Simply Tea ApS, one of the largest tea importers in the Nordic region, based in Denmark, in an exclusive interview commented: There is a huge interest regarding specialty tea in Denmark and some other Nordic states and a decline in supermarket commodity tea. Since the outbreak of Covid19, we are experiencing more and more restaurants and fermented tea companies looking for sustainable specialty tea. The demand for a healthy beverage seems to be on everyone’s agenda.”

She said that quality is always an issue as most Scandinavians know very little about tea or its production. “In order to meet the demand for education we have now planted five acres of Camellia sinensis plants in our own tea garden in Denmark. I suppose this can be defined as our major achievement for this year.

As the demand for tea in the Nordic region remains strong, some leading Western European tea manufacturers and marketers are considering accelerating their expansion into this market. Mike Harney, vice president of New York-based Harney and Sons, said, “We as a family-run company do well in the Norway region and have started distribution in Sweden. In terms of expansion in the next year, we are hoping 2022 takes our company to a whole new level amongst consumers in the Nordic region.”

• Eugene Gerden is an international freelance writer, who specializes on covering of global coffee, tea and agricultural industry. He worked for several industry titles and can be reached at gerden.eug@gmail.com.

The post Coffee is still beloved in the Nordic states appeared first on Tea & Coffee Trade Journal.