No 30

Premiumization of Freeze-Dried Coffee

November, 2015

100% NOTEWORTHY

Premiumization of Freeze-Dried Coffee

In line with global trends, Colombian soluble coffees, made with highest-quality beans, offer an increasingly wider range of unique and differentiated experiences.

Premiumization is a global trend that reflects the growing demand for products of the highest quality that provide consumers with unique and differentiated experiences.

The coffee industry is no stranger to this global trend. In recent years, sophisticated and vertiginous lifestyles have led to a demand for unique experiences of premium coffees involving not only products of the highest quality, but convenient and versatile consumption habits.

Soluble coffees have reacted to this trend by increasing their quality and taking advantage of instant preparations.


In 2013, the market of soluble coffee was 745,000 tons, of which 520,000 (70%) corresponded to spray-dried coffee, 191.000 (26%) to freeze-dried coffee and 34,000 tons (4%) to coffee extract. For these three types of soluble coffees, the premium category accounts for 11% of the global soluble market, that is, 57,000 tons of spray-dried coffee, 21,000 tons of freeze-dried coffee and 3,500 tons of extract, according to figures by Euromonitor and LMC.

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Gaining spaces in the market
The trend towards premiumization has made it possible for soluble coffees to conquer market shares that were not possible in the past. Traditional tea drinking markets have opened up important opportunities for premium soluble coffees.

According to Euromonitor, in 2014 UK consumers, a market that traditionally has consumed tea, drank 25 liters of brewed instant coffee (on a per capita basis), a figure that compared to the global average of 7 liters is surprising.

Other emerging markets that have opened up important opportunities for soluble coffee are Morocco, Turkey, India and countries in Eastern Europe and Southeastern Asia, to name a few.

In Singapore, for example, local companies of standard instant coffee have extended their existing lines by introducing new flavors that meet local tastes, while in Indonesia instant coffee sales are forecast to outpace those of fresh coffee.

In addition, residents in big cities are getting used to coffee shops and gourmet coffee drinks that have led them to increase quality of coffee prepared and drank at home. Specialized coffee shops have contributed to familiarize consumers with micro ground coffee offerings and single-cup roasted and ground coffee machines.

Buencafé: constant innovation

As a way to add value to coffee produced by Colombian coffee growers, the Colombian Coffee Growers Federation (FNC) and Café de Colombia have always thought of better production and brewing methods.

So in 1973, the factory of freeze-dried coffee Buencafé opened its doors; to date it has won important quality awards, positioning Colombian soluble coffee, 100% Arabica (Robustas are more commonly used in the soluble industry as an input), one step ahead of competitors in the segment of premium soluble coffees.

In 2013, with the different products of its portfolio, Buencafé sold 7,300 tons of freeze-dried coffee (35% of the global total), and 800 tons of coffee extract (23% of the global total). Buencafé is the only manufacturer of freeze-dried coffee that belongs to the 100% Program, which represents an important added value and a quality guarantee for over 40 brands of customers in different countries for which it makes their coffee.

By 2015, shares of 38% (8,500 tons) for freeze-dried coffee and 21% (750 tons) for coffee extract are expected, confirming Buencafé as a major player in the industry of freeze-dried coffee and extracts.

Soluble coffee markets demand more and more premium products, especially in the most developed markets such as Russia, Great Britain and some Asian countries, and that’s where Buencafé has found a great strength.

 

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In line with global trends, Buencafé keeps innovating and developing products for consumers who seek unique experiences in soluble high-quality coffees, by incorporating, for example, particles of micro-roasted coffee.

“Our Roasted Instant Coffee (freeze-dried + micro-ground particles) has the best of both worlds: the flavor of fresh roasted, ground coffee and the convenience of soluble instant coffee,” says Carlos Osorio, director of research and development at Buencafé.

This innovation in soluble coffees has been, in part, a response to single-cup roasted and ground coffee machines, which have redefined the concept of instant coffee, no longer a synonym for soluble coffee. “Now that roasted and ground coffee has become more convenient, and soluble coffee has improved its quality, that difference is not as clear as it used to be,” Osorio adds.

Café de Colombia’s quality, differentiation and added value strategy is not limited to green coffee, but also guides the segment of soluble coffees, for the benefit of Colombian coffee growers and the value proposition of the 100% brands.

 


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