Tag: coffee industry growth

East Asia’s Coffee Shop Landscape Surges as China Alone Adds 20,000 Stores in One Year

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Dubai – Qahwa World

A new edition of Project Café East Asia 2026 by World Coffee Portal reveals an exceptional year for the branded coffee chain sector across East Asia, with the region’s total number of outlets jumping 18.4% to reach 180,268 stores. The strongest momentum came from China, Thailand, Indonesia, Vietnam, and the Philippines, all of which posted double-digit expansion in store counts.

  • China Leads the Region with Record-Breaking Growth

China registered the fastest acceleration, expanding its branded coffee shop network by 31.5% over the past year to reach 87,505 outlets—nearly half of all branded cafés in East Asia and almost double the size of the U.S. market. It also became the first national market ever to add more than 20,000 net new stores within a single calendar year.

The main force behind this surge came from domestic champions Luckin Coffee and Cotti Coffee, which together contributed over 12,000 new locations, representing half of the country’s entire branded segment.

China’s competitive landscape is being shaped heavily by pricing battles, most notably the RMB 9.9 (US$1.40) rivalry between Luckin and Cotti. This emphasis on affordability has also propelled the rise of budget-forward chains such as Lucky Cup, operated by Mixue, and KCOFFEE under Yum China.

As local operators increasingly dominate, several international brands have been pushed to reconsider their strategies. A striking example is Starbucks’ agreement to sell a majority stake in its 8,000-store Chinese business to Hong Kong–based Boyu Capital in a deal valued at $4 billion.

  • China Emerges as a Global Lab for Beverage Innovation

While 80% of surveyed Chinese consumers drink hot coffee at least once a week and a quarter consume it daily, operators are aggressively expanding their cold, flavored, and fruit-infused offerings—turning China into a leading testing ground for new flavors.

Matcha, palm sugar, and coconut were rated among the most appealing additions by consumers. Luckin Coffee’s Coconut Latte, introduced in 2017, continues to dominate its sales charts. The brand is known for launching experimental drinks weekly, resulting in items like jelly lattes and cheese lattes.

KCOFFEE has taken novelty even further, releasing products such as Egg Tart Dirty Coffee, a fried-chicken-inspired latte, and even a sparkling black vinegar Americano.

  • Homegrown Chains Strengthen Positions Across East Asia

East Asia’s coffee chain ecosystem is increasingly being shaped by domestic players that emphasize local traditions, accessible pricing, and menus tailored to national tastes. According to World Coffee Portal’s consumer survey, 57% of Chinese respondents prefer homegrown chains over international brands—a trend replicated across the region.

Key examples include:

Jinji Jawa in Indonesia,

ZUS Coffee in Malaysia,

Pickup Coffee in the Philippines, and

Milano Coffee in Vietnam—

each of which added hundreds of new stores in the last year. Their rapid expansion outpaced Western competitors like Starbucks, Costa Coffee, and Dunkin’.

Thailand showed similar dynamics: Café Amazon and PunThai Coffee accounted for 80% of all new cafés opened in the country this year, highlighting the region’s increasing focus on localization, digital engagement, and culturally relevant branding.

  • Industry Leaders Expect Continued Growth

The majority of operators surveyed remain optimistic about the sector’s direction:

71% reported higher sales over the past year.

68% expect trading conditions to further improve in the next 12 months.

World Coffee Portal forecasts that East Asia will become the first region to surpass 200,000 branded coffee shops by the end of 2026. By November 2030, the regional market is projected to exceed 263,000 outlets, reflecting a five-year compound annual growth rate of 7.9%.

  • China is expected to maintain strong momentum with:

20% outlet growth in 2026, and

10.3% average annual growth over the following five years,
bringing its store count to over 142,500 outlets by 2030.

Other markets—including Cambodia, Indonesia, Malaysia, the Philippines, and Vietnam—are also predicted to achieve double-digit outlet expansion over the next year.

  • Expert Insight

Commenting on the findings, Jeffrey Young, Founder and CEO of Allegra Group, highlighted East Asia’s rising global influence. He described China’s addition of more than 20,000 stores in a single year as “astonishing” and emphasized that the region is poised to drive the majority of global coffee market growth in the coming decades. Young added that the entry of East Asian chains into Western markets—along with their distinctive approaches to technology and product innovation—could reshape international trends.

Vietnam’s Coffee Exports Hit Record Levels and Set Sights on New Growth in 2026

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Ho Chi Minh  – Qahwa World

Vietnam has closed the 2024–2025 coffee season with unprecedented results, marking the highest performance in the history of its coffee industry. The country’s coffee export value reached USD 8.4 billion, according to the Vietnam Coffee and Cocoa Association (VICOFA), which held its annual conference on 24 October 2025 in Ho Chi Minh City, attended by representatives from the Ministry of Agriculture and Environment, exporters, and local producers.

Data released by the association shows that from October 2024 to September 2025, Vietnam exported over 1.5 million tons of coffee—an increase of 1.8 % in volume and 55.5 % in export value compared with the previous season. The average export price reached USD 5,610 per ton, up 52.7 % year on year.

Europe remained Vietnam’s largest export market, accounting for about 47 % of total shipments—more than 710,000 tons—valued at over USD 4 billion. Within that figure, the 27 European Union countries represented 40.1 % of the total exported volume and 39.4 % of export value, reaffirming the country’s strong foothold in European markets despite tightening sustainability regulations.

Speaking at the event, Hoang Trung, Deputy Minister of Agriculture and Environment, praised the industry’s achievements as a result of joint efforts among farmers, exporters, and government agencies to improve product quality and expand international market access. He reported that the total coffee cultivation area reached 731.9 thousand hectares, including 678.5 thousand hectares in production, while re-planted areas covered 20 thousand hectares, achieving 96.4 % of the national re-planting plan.

According to the deputy minister, favorable weather conditions and high coffee prices encouraged farmers to invest in intensive cultivation and rejuvenate plantations, leading to higher productivity and improved bean quality. Government estimates suggest that total coffee production could approach 2 million tons this year—an impressive achievement demonstrating Vietnam’s resilience amid global agricultural volatility.

A key highlight of the conference was the announcement that cooperation between VICOFA, government authorities, and international partners had resulted in the creation of a national traceability database covering 137,000 hectares of coffee farms, which is now being expanded to 462,000 hectares, or about 80 % of the total coffee area in the Central Highlands. Thanks to this initiative, the European Union has classified Vietnam as a “low-risk” country under the EUDR (Deforestation Regulation), requiring inspection of only 1 % of imported shipments. Trung described this classification as “a recognition of Vietnam’s transparency, accountability, and environmental responsibility within the coffee sector.”

He further noted that programs dedicated to specialty and high-quality coffee, as well as sustainable low-emission initiatives, have significantly contributed to increasing the added value of Vietnamese coffee and strengthening its brand identity on the global stage.

The report also showed that by mid-October 2025, Vietnam had already exported 1.27 million tons of coffee, valued at USD 7.21 billion—a 12.5 % rise in volume and more than 62 % growth in value compared with the same period a year earlier. This performance highlights a strategic shift from expanding output to enhancing value and quality, underscoring the success of Vietnam’s transformation from a commodity-based producer to a sustainability-driven exporter.

During the event, VICOFA projected that coffee production for the 2025–2026 season could increase by 10 % from the previous year if favorable weather continues. The association said that encouraging price levels had motivated farmers to increase investments in crop care and expand their cultivated areas, raising prospects for another strong season ahead.

Deputy Minister Hoang Trung outlined several key directions for sustaining growth and maintaining competitiveness:

  • Expand sustainable production by adopting international certification standards such as RA, 4C, FLO, and C.A.F.E. Practices.
  • Strengthen traceability and deep processing to reduce dependence on raw-bean exports.
  • Adopt low-emission cultivation techniques to cut fertilizer and pesticide use and promote water-efficient irrigation.
  • Diversify markets beyond Europe toward Asia and Southeast Asia, leveraging cross-border e-commerce opportunities.
  • Promote the “Vietnam Coffee” brand in specialty segments through global marketing and participation in exhibitions and trade fairs.
  • Foster stronger linkages across the supply chain—from farmers and cooperatives to processors and exporters—to ensure equitable and sustainable growth.
  • Enhance awareness and compliance with import-market requirements, especially environmental and traceability regulations under the EU EUDR.

The conference concluded with a shared conviction among participants that, with its robust agricultural base, growing commitment to sustainability, and rapidly improving quality standards, Vietnam is on course to strengthen its position as one of the world’s leading coffee exporters. As the new 2025–2026 season approaches, the sector looks set for further expansion, higher value, and record-breaking achievements in the years ahead.

China Coffee Market Set to Surpass $45 Billion by 2032 as Demand Soars

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Dubai – Qahwa World

China’s coffee market is experiencing a remarkable surge, driven by shifting consumer habits and rapid retail expansion. The market was valued at USD 20.9 billion in 2024 and is projected to more than double to USD 45.5 billion by 2032, reflecting a compound annual growth rate (CAGR) of 10.19% between 2025 and 2032. This growth marks a profound transformation in a country long dominated by tea culture, positioning coffee as a rising force in the beverage sector.

Coffee production in China is concentrated in Yunnan, which accounts for over 60% of national output, followed by Hainan and smaller contributions from Fujian. Despite these efforts, the domestic supply remains insufficient to meet demand, leaving the country heavily reliant on imports. This has prompted both government agencies and private companies to invest in research and development aimed at boosting productivity and improving quality. Instant coffee continues to hold the largest market share due to its convenience, while ground coffee and whole beans are expanding as consumer tastes diversify.

Retail competition is intense, with international and domestic chains reshaping the landscape. Starbucks now operates more than 3,300 stores across China, while Luckin Coffee is racing ahead with plans to open 10,000 outlets, supported by a digital-first model tied to WeChat. This strategy not only simplifies ordering but also enables data-driven insights into consumer behavior. Meanwhile, Manner Coffee has captured younger professionals by pricing its drinks up to 40% lower than Western rivals and offering eco-conscious incentives such as discounts for reusable cups. Costa Coffee, on the other hand, leans on product localization, tailoring flavors to match regional preferences, with noticeable differences between its Beijing and Shanghai menus.

E-commerce has emerged as a critical growth driver, with Alibaba’s Tmall commanding a 56.6% share of online coffee sales, followed by JD.com at 24.7%. This dominance highlights the growing importance of digital platforms as consumers increasingly purchase both imported and domestic coffee products online.

The competitive landscape is anchored by major global and local players including Nestlé, Starbucks, Luckin Coffee, Gloria Jean’s, Kraft Heinz, Coca-Cola, JAB Holding, and Luigi Lavazza, alongside domestic firms such as Hainan LISUN and Dehong Hogood Coffee. Each is striving to consolidate its position through geographic expansion, product innovation, and stronger consumer engagement strategies.

Looking ahead, analysts predict that growth will not only be quantitative but also qualitative, as trends in sustainability, functional beverages like protein coffee, and digital integration reshape the industry. With a projected CAGR of 10.19% and consumer demand accelerating at unprecedented speed, China is on track to establish itself as a global powerhouse in the coffee industry, blending its growing domestic production with a robust import market to satisfy a rapidly evolving consumer base.

Breville Eyes China’s Coffee Market as U.S. Tariffs Pressure Sales

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Dubai, 21 August 2025 (Qahwa World) – Breville is looking to China and the Middle East as promising new growth markets for its coffee appliances, aiming to balance the impact of U.S. tariffs on its business. Chief executive Jim Clayton said rising demand for premium coffee machines in these regions provides long-term opportunity, even as higher import duties in the United States pose near-term challenges.

The company, which generates about 40 percent of its revenue from the U.S., has shifted part of its production from China to facilities in Indonesia and Mexico. Clayton confirmed that this diversification strategy will continue through the year to reduce exposure to higher costs.

For the year ending June 30, Breville posted revenue of $1.7 billion, an increase of nearly 11 percent, while operating profit rose just over 10 percent to $204.5 million. Despite the strong performance, investor concerns about tariffs weighed on the share price. Clayton acknowledged that higher input costs remain an issue for the U.S. market but said the company would manage these pressures through supplier negotiations, selective price increases, and new product launches.

Recent highlights include the launch of the Oracle Dual Boiler coffee machine in Australia, with a new grinder and a compact smart oven scheduled for release this month. Coffee appliances remain the company’s leading category, helping Breville deliver double-digit growth across all three of its regional markets in 2025. The business has increased revenue and profit every year since 2015, even during challenging conditions.

Analyst opinions are mixed. Some warn that U.S. tariffs could affect earnings through FY27, raising questions about consensus forecasts of flat growth this year and a return to double-digit gains next year. Others view the current slowdown as temporary, pointing to Breville’s consistent record of expansion and opportunities in international markets. UBS projects that the $5 billion company could more than double sales over the next decade, driven by coffee market growth globally and particularly in China.

Founded over 90 years ago, Breville has grown into a global brand with a presence in more than 70 countries. Known under the Breville and Sage names, the company has built a reputation for innovation in small appliances and premium coffee equipment. Its teams of engineers, designers, and food technologists have helped place Breville at the forefront of its category. The company also emphasizes sustainability and ethical practices across its operations, with a focus on reducing environmental impact and contributing positively to society.

Clayton said that early results in China and the Middle East are encouraging, though still in the early stages, and that both regions represent significant long-term potential. To close out the financial year, Breville declared a final dividend of 19 cents per share, bringing the full-year payout to 37 cents, payable on October 2.