Italy’s instant coffee market is estimated to be valued at US$166.868 million in 2020 and is anticipated to decline by 2.10% during the forecast period.
Most of the domestic demand for coffee in Italy is met by imports. The country is the second-largest coffee importer (green coffee beans) in the European region after Germany. As per the CBI, Ministry of Foreign Affairs, in 2018, the country imported around 97% of the total imports from the producing countries. The three main green coffee supplying countries include Brazil, Vietnam, and India. These accounted for around 64% of the total supplies. However, the market for instant coffee in the country is in decline owing to the shift to fresh coffee and speciality coffees. The market for speciality coffee is currently a niche market. However, it is creating substantial opportunities for high-quality coffee exporters, further fueling the market growth for speciality coffee in the region.
Moving on to retail sales of coffee to end-users in Italy, it was observed that the Italian coffee-end market is categorized on the basis of in-home and out-of-home consumption. The consumption of coffee pods and capsules is accounted to be the largest growing segment in the end-user market. An exporter utilizes different modes of distribution channels in order to bring coffee products to the Italian market. The market entry varies according to the quality of coffee and supplying capacity. It has been noticed that the suppliers from the producing countries gain entrance to the European market via an importer; however, direct trade is gaining momentum.
The Italian coffee end market, based on quality, is categorized as upper-end, high-end, middle-range, and lower-end. The upper-end quality is described as an excellent coffee type with a cupping score of 85 and above. The market is currently small but growing.
The lower-end quality coffee is mainly blended coffee, consisting of mainly Robusta beans (approximately 40% to 100%), and is mainly dominated by instant coffee in the country. These are sold in supermarkets and through service channels in offices and universities with minimum certification. However, the preference for fresh coffee is leading to a decline in the consumption of instant coffee in Italy.
It is therefore concluded that the overall market in Italy is predicted to decline over the next five years due to a continuous decline in retail sales. This is due to the growing retail sales of fresh coffee and other high-end coffees in the region.
The current COVID-19 pandemic scenario is also projected to affect the market growth in the current year due to the shutdown of cafés, coffee houses, hotels, restaurants, universities, and offices, further hampering the market growth in 2020 due to the lockdown, self-quarantine, and work from home measures.
Key Developments in the Market
COVID-19 Insights:
COVID-19 had a significant impact on the Italy instant coffee market. The deployment of complete lockdown led to the closure of the multiple institutions, corporations, food outlets, and many other public places, causing the sales to decline in these segments.
Segmentation: