Food & Beverage

Coffee consumption continuing post pandemic trajectory

Coffee consumption will continue to improve for the second straight year following the pandemic. Production was hampered in 2021/2022 by meteorological conditions, but is expected to recover in 2022/2023.

Image: Adobe Stock.

June 1, 2023 by Elliot Maras — Editor, Kiosk Marketplace & Vending Times

Coffee consumption will continue to improve in 2023, driven by the pent-up demand created by the pandemic for the second straight year, according to the recently released Coffee Report and Outlook from the London based International Coffee Organization.

Consumption is expected to grow, but at a decelerating rate of 1.7% to 178.5 million bags compared to the prior year when it posted a 4.2% gain to 175.6 million bags, marking the sharpest growth rate since the 4.6% gain in coffee year 2000/2001.

Economic factors affect growth

Consumption in coffee year 2022/2023 will also be affected by slowing economic growth and the rising cost of living which will cause consumers to trade down to more economical coffees.

Slowing economic growth is expected from the non-producing countries, with Europe's consumption suffering from the greatest deceleration.

In addition to the impact of the post-pandemic rebound, consumption growth in coffee year 2021/2022 was also driven by 6% global economic growth.

On a regional basis, Europe saw the largest rate of expansion in 2021/2022, increasing 6%, with coffee consumption increasing to 55.4 million bags. The region's share of world consumption rose by one percentage point to 32%.

North America's coffee consumption increased 4.8% in 2021/2022 to 31.7 million bags from 30.2 million bags in the previous year.

Despite the growth, consumption in 2021/2022 in North America was still below pre-COVID-19 levels, which included some of the highest on record.

Production to recover

World coffee production is expected to recover in 2022/2023, increasing by 1.7% to 171 million bags compared to a 1.4% decrease in 2021/22.

The production outlook is based on the following factors:

Increased global fertilizer cost will have a negative impact,
Adverse weather conditions will carry over from 2021/22 and have a negative impact, especially in the Americas and Africa.
Productivity is improving due to increased adoption of good agricultural practice.
Production from new planting of coffee trees will have their first harvest on the third year of planting, and it will steadily increase the yield annually.

Coffee production in 2021/22 was hampered by negative meteorological conditions.

Increased global fertilizer costs and adverse weather conditions are expected to partially offset the positive impact of the on production from Brazil, explaining the relatively low rate of growth in 2022/2023.

Arabica is projected to increase by 4.6% to 98.6 million bags in 2022/2023, following a 7.2% decrease in the previous year, the sharpest fall since 2003/2004, when world Arabica production plunged by 10.5%.

The drop in global Arabica output in 2021/2022 was driven largely by a 7.5% drop South America, where two top Arabica producers, Brazil and Colombia, experienced downturns in the same year.

Robusta, by contrast, posted a 7.1% increase in 2021/2022. Asia and Oceania, the largest producers of Robusta, led the way with a 10.1 % boost 2021/2022 to 45.2 million bags.

South America, the largest coffee producing region, will boost total output by 6.2% to 82.4 million bags in 2022/2023, after suffering the biggest drop in 20 years in 2021/2022, falling 7.6% to 77.6 million bags.