Coffee is more popular than ever – and could get more popular due to China
Coffee popularity is at an all-time high. Consumers in Europe are the biggest drinkers, followed by the U.S., but another huge market is opening up in what was once tea-drinking country: China. Given that Chinese demand is expanding quickly, and that the biggest coffee drinkers in the West are the relatively young Millennial generation, coffee looks likely to continue growing in popularity over the next decade.
For the first five months of the 2016 / 2017 growing year, demand for coffee beans rose by 6.7% - and if they Chinese continue their uptake of western coffeehouse culture, some forecaster predict that global demand could increase by as much as 5% in the next five years.
The Chinese love of coffee is being stoked by Starbucks, which plans to expand operations in the country this year, and was instrumental in introducing the western concept of the coffeehouse to China long before its peers. The company rightly understood that Chinese consumers would appreciate the values of western luxury, and consequently has a huge lead over its rivals. The speed at which Chinese consumers have become sophisticated, and are continuing to become so, has been breathtaking, and is showing no signs of slowing: that’s great news for coffee in the country.
Globally, Europe is the number one coffee drinker – not surprising, perhaps, given the presence of France and Italy on the continent. The U.S. is coffee’s second-largest international market, and statistics from the country demonstrate that it is Millennials who are most in-love with the drink: yet another indicator that coffee’s popularity will continue to grow as these consumers age.
Dominion holds Starbucks in its Global Trends Luxury Fund.
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