Coffee drinking culture perks up in China

Rapid development

The domestic coffee market has entered a stage of rapid development. Orders from coffee shops jumped 250 percent year-on-year in the second quarter of 2023, making it the fastest-growing category among all beverages, according to food delivery platform Meituan.

Nottington (Kunshan) Coffee Co Ltd, a Kunshan-headquartered coffee chain that operates more than 200 stores nationwide, reported that its coffee sales grew by 30 percent on a yearly basis in the first half of this year.

"Not only is the consumption of freshly ground coffee growing rapidly, consumers are also favoring ready-to-drink coffee due to its convenience," said Tang Xukai, president of Nottington (Kunshan) Coffee.

The company's production line for this type of product has been operating at full capacity in South China's Guangdong province, Tang added.

In addition to major cities, most of the sales volume comes from smaller markets.

Due to the fast-paced market growth, there is an increasing demand for coffee beans, with an average monthly growth rate of 11 percent to 13 percent, said Li Jiamin, owner of Yunnan Chaoka Trading Co Ltd, which runs a number of coffee stores in smaller cities.

According to Tianyancha, a Chinese corporate information provider, currently, more than 180,000 coffee-related businesses operate in the country. In 2022, 34,000 new companies gained business licenses in this field, a growth rate of 11.75 percent.

Zhang Yi, chief analyst of AI Media Consulting (Guangzhou) Co Ltd, said China's coffee market is in a phase of high-speed development.

The country's coffee industry is expected to maintain a growth rate ranging from 25 percent to 35 percent in the coming years. By 2025, it is projected that the overall market size nationwide will exceed 1 trillion yuan, AI Media Consulting (Guangzhou) said in a report.

Although more people in China are embracing the coffee culture, per capita coffee consumption in the country still lags behind that of developed nations like Japan, South Korea, and the United States. This has caught the attention of global coffee brands, who recognize the immense untapped potential of the Chinese market, he said.

China traded 231,200 tons of coffee and related products worth 9.35 billion yuan in the global market last year. Meanwhile, its import volume accounted for 175,300 tons, with a total value of 7.39 billion yuan, Customs data showed.

Wang Lingjun, vice-minister of the GAC, said the government will further deepen cooperation with relevant departments of African countries in inspection and quarantine, and expand the variety of agricultural and food products, including aquatic products, fruit, honey and coffee, imported to China.