Instant Coffee Market Reflects Economic Effects of Tariff

Overview

New York, NY – May 21, 2025 – The Global Instant Coffee Market is growing fast, driven by busy lifestyles and the demand for quick, convenient caffeine fixes. In 2024, the market was valued at USD 20.8 billion, but it’s expected to reach USD 32.9 billion by 2034, growing at a steady 4.7% CAGR.

In 2024, Spray-Dried instant coffee commands a 72.3% market share due to its cost-effective production and long shelf life. Unflavored instant coffee leads with a 76.1% share in 2024, favored for its authentic taste and versatility. Sachets hold a 37.4% share in 2024, driven by their convenience for single-serve use. Urban consumers, travelers, and office-goers prefer sachets for quick, mess-free coffee preparation. Supermarkets and Hypermarkets dominate with a 51.2% share in 2024, offering vast shelf space and brand variety.

US Tariff Impact on Market

May 18, 2025, President Donald Trump unveiled his Liberation Day tariffs, imposing new duties ranging from 10% to 46% on imports from 15 of the top 20 coffee-producing nations. Coffee imports generate USD 43 in economic value per dollar and sustain 2.2 million U.S. jobs, making it America’s top beverage, said William ‘Bill’ Murray, President of the National Coffee Association (NCA), in a statement to DCN. Coffee prices were already at record levels due to poor harvests in major producers like Brazil and Vietnam.

The new U.S. tariffs target the top five coffee-producing nations: Brazil (10%), Vietnam (46%), Colombia (10%), Indonesia (32%), and Ethiopia (10%), which dominate global coffee exports. Ivory Coast, the world’s top cocoa producer, faces a 21% tariff, while Ghana and Indonesia, the second and third largest, face 10% and 32%, respectively. Finished chocolate products from major producers are also hit: Swiss chocolate faces a 31% duty, EU-made chocolate is taxed at 20%, and UK chocolate carries a 10% surcharge.

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Government data shows the retail price of ground coffee reached a peak of USD 7.38 per pound in March 2025, an 84% increase from USD 4.30. A 10% global tariff currently applies to all U.S. coffee imports, with higher rates for countries such as India, Indonesia, and Vietnam. The Trump administration has temporarily suspended these additional levies for 90 days. The NCA notes that only 1% of coffee consumed in the U.S. is grown domestically, primarily in Hawaii and Puerto Rico. The remaining 99% of raw coffee beans are imported, with Americans spending nearly USD 110 billion annually on coffee.

Key Takeaways

• Global Instant Coffee Market is expected to be worth around USD 32.9 billion by 2034, up from USD 20.8 billion in 2024, and grow at a CAGR of 4.7% from 2025 to 2034.
• Spray-dried instant coffee dominates the market, holding a substantial 72.3% material segment share.
• Unflavored instant coffee remains most popular, capturing 76.1% of the market by flavoring preference.
• Sachets are a preferred packaging choice, accounting for 37.4% of instant coffee packaging.
• Supermarkets and hypermarkets are leading distribution channels, with a 51.2% market share.
• Europe dominates global instant coffee demand, holding a strong 48.1% market share value.

Report Scope

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Key Market Segments

• Spray-Dried Dominance: In 2024, spray-dried instant coffee commands a 72.3% market share due to its cost-effective production and long shelf life. Popular in price-sensitive regions, it retains basic coffee aroma and suits mass-market brands and institutional buyers. Its high solubility makes it ideal for sachets and vending machines, with manufacturers improving processes for better quality and energy efficiency.
• Unflavored Coffee Preference: Unflavored instant coffee leads with a 76.1% share in 2024, favored for its authentic taste and versatility. Consumers and foodservice providers value its customizability, adding milk, sugar, or spices as desired. Its affordability and longer shelf life drive bulk purchases, especially in emerging markets where flavored options remain less popular.
• Sachet Packaging Popularity: Sachets hold a 37.4% share in 2024, driven by their convenience for single-serve use. Urban consumers, travelers, and office-goers prefer sachets for quick, mess-free coffee preparation. Affordable and portable, they’re widely distributed in supermarkets and e-commerce, appealing to cost-conscious households and institutional settings like hotels and airlines.
• Supermarkets Lead Distribution: Supermarkets and hypermarkets dominate with a 51.2% share in 2024, offering vast shelf space and brand variety. Their widespread reach and promotional pricing encourage bulk and impulse purchases. Trusted by urban and semi-urban shoppers, these outlets ensure steady availability and support new product launches, making them the top choice for instant coffee sales.

Regional Analysis

• Europe holds a commanding 48.1% share of the instant coffee market, valued at USD 10.0 billion. Its deep-rooted coffee culture and preference for convenient beverages drive strong demand across Western and Eastern countries, with supermarkets and hypermarkets boosting product visibility and accessibility for diverse consumers.
• North America trails Europe, fueled by the rising popularity of instant coffee among busy professionals and students seeking quick, on-the-go solutions. The convenience of instant coffee aligns with fast-paced lifestyles, making it a favored choice in offices and educational settings.
• The Asia Pacific region sees growing instant coffee use due to urbanization and changing lifestyles, especially in India and China. While specific data is unavailable, increasing demand reflects a shift toward convenient beverages among expanding urban populations. Latin America’s coffee culture supports consistent instant coffee market growth, particularly in countries with rising middle-class populations.

Top Use Cases

• Convenient Morning Beverage: Instant coffee is a quick solution for busy mornings, requiring only hot water to prepare. It’s ideal for professionals and students needing a fast caffeine boost. Its ease of use and minimal preparation time make it a go-to choice for those with hectic schedules, ensuring they stay energized without hassle.
• Travel-Friendly Option: Instant coffee’s portable sachets or jars are perfect for travelers, campers, or anyone on the go. It eliminates the need for brewing equipment, offering a lightweight, easy-to-carry alternative. Whether at a hotel or campsite, users can enjoy a consistent coffee experience with minimal effort, enhancing convenience during trips.
• Cost-Effective Alternative: Instant coffee is more affordable than freshly brewed or specialty coffee, appealing to budget-conscious consumers. It delivers a similar caffeine kick at a lower price, making it popular in households and offices. Its long shelf life also reduces waste, providing value for money without compromising taste.
• Workplace Productivity Booster: Instant coffee is a staple in offices, offering employees a quick way to stay alert. Its fast preparation fits tight work schedules, supporting focus and productivity. Single-serve packets are especially popular, allowing workers to customize their coffee strength without needing complex machines or barista skills.
• Health-Conscious Choice: Many instant coffee brands now offer organic or low-calorie options, catering to health-focused consumers. Some include functional ingredients like vitamins or green tea extract, promoting benefits like metabolism support. This appeals to those seeking healthier beverage choices while still enjoying the convenience and taste of instant coffee.

Recent Developments

1. Kraft Heinz Company

• Kraft Heinz has been expanding its Maxwell House instant coffee line with new flavors and sustainable packaging. The company is focusing on convenience and affordability, targeting budget-conscious consumers. They have also introduced single-serve instant coffee sticks for on-the-go consumption.

2. The Coca-Cola Company

• Coca-Cola, through its Costa Coffee brand, launched instant coffee mixes in ready-to-drink and stick formats. They emphasize premium quality, using 100% Arabica beans. The brand is expanding in Europe and Asia, leveraging Coca-Cola’s strong distribution network.

3. JAB Holding Company

• JAB, owner of Peet’s Coffee, has been investing in premium instant coffee products, including specialty-grade freeze-dried options. They are also focusing on sustainability, with compostable packaging and ethically sourced beans.

4. Jacobs Douwe Egberts (JDE Peet’s)

• JDE Peet’s introduced L’OR Barista Instant Coffee, targeting coffee enthusiasts with barista-style quality. They are also expanding in emerging markets like India and Brazil with affordable instant coffee sachets.

5. Kraft Foods Inc.

• Kraft Foods (now part of Mondelez International) continues to strengthen its Ovaltine & Carte Noire instant coffee brands with new flavors and health-focused variants, such as low-acid and antioxidant-rich options.

Conclusion

The Instant Coffee Market thrives due to its convenience, affordability, and versatility, catering to diverse consumer needs globally. Europe leads with strong demand, while regions like Asia Pacific and Latin America show steady growth. Spray-dried and unflavored variants dominate, with sachets and supermarkets driving accessibility. As lifestyles evolve, instant coffee remains a practical, widely adopted beverage choice.

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