Spain instant coffee market is estimated to be valued at US$222.029 million in 2019 and is projected to remain relatively stagnant during forecast period.The hospitality industry is one of the main pillars contributing to the country’s GDP. The sector is also responsible for the substantial amounts of international tourists in the region. The hospitality industry is accounted for holding a significant number of coffee shops and bars. Out of which, there is a prevalence of more than 17,000 coffee shops in the country. The growing hotel establishments in the country are further providing an impetus in burgeoning the market growth in the forecast period.
The prevalence of coffee consumption out-of-home, in office areas, is further accounted to hold strong market growth prospects during the forecast period. This is majorly attributed to the fact that office is where people spent the maximum amount of their time, hence, workplaces are considered as the most common refreshment areas where individuals can gather and discuss their work along with a cup of coffee. In addition, one can find coffee vending machines at various points in an office environment, further fueling the market demand in the forecast period. Furthermore, the evolving work culture is contributing to the surge in consumption of both fresh and instant coffee. This involves the designing of offices in a way so as to promote greater collaboration and idea-sharing among the colleagues in a smooth manner, along with the availability of coffee machines. With time, these coffee spaces are defined as the “coffee houses of tomorrow”, denoting its growing importance for coffee consumption.
Significant investments by the big market players will continue to drive the market growth in the region along with other parts of the world. For example, in 2017, Nestle announced to invest €37 million in its Nescafe coffee factory in Girona. This step is made towards increasing the coffee capacity by 20% approximately. The investment will further allow the company to add a third production line for the manufacturing of Nescafe instant coffee. The capacity expansion initiative is projected to be operational by the end of 2018. The production line is set to raise the factory’s overall manufacturing capacity to more than 30,000 tonnes. The new facility is equipped with advanced technology that is more eco-friendly utilizing around 40% less energy and around 33% less water per kg of the final product. Furthermore, the investment is poised to manufacture innovative products with unique textures, more aroma, and greater creaminess. A substantial part will be exported to European, Middle East, and North African countries.
The current novel coronavirus scenario is projected to impede the market growth in 2020, due to the lockdown and quarantine initiatives taken to avoid the transmission of the virus particles. Additionally, this has further led to the closure of coffee shops, hotels, restaurants, further impeding the market growth in the hospitality sector. The shift in consumers’ willingness to spend on essential food products has certainly put a significant impact on hampering the market growth in households as well amid the COVID-19 pandemic situation. However, after recovery, i.e. post lockdown, the market will further continue to grow at a slow pace by the end of 2025 with specific precautions in order to achieve workplace safety.