Hungary instant coffee market is estimated to attain a market size of US$211.173 million by the end of 2027. The market was valued at US$158.485 million in 2020 and is projected to grow at a CAGR of 4.19%.
It is observed that direct coffee imports in Eastern European countries, including Hungary, are low. However, the overall coffee import from Eastern European countries is growing. The increasing disposable income, along with the growing interest in high-quality coffee, will continue to increase the market growth for instant coffee varieties in the region. The large multinational enterprises and mainstream brands dominate Hungary’s coffee market. Additionally, the growth of specialized small coffee roasters further propels the market growth in the forecast period.
According to the Centre for the Promotion of Imports from developing countries (CBI) estimates, Eastern European countries were reported to account for a share of around 18% sales of the overall coffee revenue in the EU market in 2018. Hungary accounted for a share of around 1.8% of coffee consumption in Eastern Europe after Poland and Romania. Robusta holds a major market share in Eastern European countries due to the preference for instant coffee in the region. Hence, this indicates that instant coffee in Hungary will continue to grow significantly during the forecast period.
The per capita consumption of coffee in Eastern European countries is low. This indicates that there is room for the market to grow along with the surging consumer income.
The country’s capital city is popular for its luxurious coffee houses and, in the past, was visited by the literary crowd. However, with time, the coffee culture evolved, and the classic cafes in the city were joined by stylish third-wave coffee stores. The capital is moving on to adopting modern coffee houses with the onset of specialty coffee shops in the city. In comparison to previous years, the younger generation prefers filter coffee. Consequently, with the evolving coffee culture in Budapest, the market is anticipated to significantly grow in the projected period. However, due to the current COVID-19 scenario, the market is predicted to experience a slight decline in 2020 due to the shutdown of cafes and public gathering spaces.
International grocery retailers dominate the Hungarian food retail sector. These include Tesco, Coop Hungary, Spar, CBA Group, Auchan, Lidl, Aldi, and Penny Market as main discounter channels.
The retail sector in Hungary, apart from the international retailers, comprises small, independent, family-owned shops. These are prevalent in less-populated regions. Many shops continue to serve the country’s rural population and hence pose significant challenges in logistics for varied distributors and suppliers. The presence of prestigious superstores, shopping centres, hypermarkets, and supermarkets in Budapest further provides an opportunity to drive the sales of consumer goods, including instant coffee products, during the forecast period. The presence of a typical distribution channel in the country for importer-wholesalers to service retailers and end-users, direct consumption is further contributing to the surging market growth.
Hungary Instant Coffee Market Segmentation: