No 30

What Do the Australian and New Zealand’s Coffee Markets Have to Offer?

February, 2016


What Do the Australian and New Zealand’s Coffee Markets Have to Offer?

A strong demand for high-quality coffees, sustainable attributes and overall a sophisticated and developed coffee market offer interesting opportunities for 100% Café de Colombia brands.

When we talk about coffee culture in Australasia, what comes to mind is the invention of the “flat white” (espresso-based beverage) a few decades ago, but the coffee culture has evolved much more.

Both Australians and New Zealanders claim to have one of the richest coffee cultures in the world; it is not for nothing that Melbourne and Wellington where included among the 8 of the world’s great coffee cities by CNN.

Nevertheless there are big differences between these two markets: there has been a shift in the way consumers pick their products in New Zealand. This has to do with the growing worries about products and their sustainability, while in Australia gourmet specialty coffee is booming and has reached Aussie homes.

Coffee in Australia, specialty indulgence and more

Australia is one of the world’s most coffee-obsessed countries. Its per capita coffee expenditure is US$ 39.2, just behind a few countries in North America and Europe. There is a growing market in Australia for different types of coffee consumers that follow trends of specialty coffee, practicality and casual consumption.

A particular trend in specialty coffee consumption has driven fresh coffee sales: specialty coffees are more likely to be found in about 1,370 independent specialist coffee shops in Australia, a significant amount by itself when compared to the nearly 1,600 chain coffee shops at the end of 2015; this means that 46% of specialty coffee shops in Australia are independent coffee shops.

The growing demand for quality coffee has allowed specialized micro-roasters (who are sourcing coffee through cooperative buying) to enter the market by pleasing the most knowledgeable coffee palates.

Source: Euromonitor

Another trend that has impacted Aussie coffee consumption habits is practicality; consumers have less time to brew coffee. This trend has driven different coffee categories depending on consumers’ involvement with coffee.

People who try to replicate the experience of specialty coffee shops at home prefer to buy coffee pods; this category has seen a major growth in the past five years and is starting to mature as many brands have launched their own coffee pod products. Instant coffee consumers, on the other hand, care less about replicating coffee shop experiences and more about convenience, and are keeping the category growth steady.


Source: Euromonitor

Casual consumption also drives instant coffee sales; consumers less involved in the coffee culture are the focus of some strategies offering a great deal in price for a cup of coffee. An example of this is the A$1 cup of coffee by Seven Eleven. Casual consumers do not depend on specialized outlets to get their cup of coffee, so they may get it at the supermarket, mall or even a pub!.

Kiwis prefer sustainable coffee

New Zealand has a strong coffee culture reflected in their coffee per-capita expenditure of US$ 37.3, just one spot behind Australia. New Zealand also has a strong base of specialty coffee consumers; the specialist coffee shops market in 2014 was worth about US$ 375 million.

There is a growing trend of sustainable and socially responsible products in the world, but in New Zealand this trend has a clear effect on how consumers are picking their coffee. Even though there has been a slowdown in the coffee market growth in New Zealand due to the rise in global coffee prices, fresh organic coffee has been the exception, as it grew 12% in terms of value.

Also a recent survey by Colmar Brunton revealed that 88% of New Zealand consumers have been influenced by sustainability in their purchase decision. This same trend has raised concerns among consumers in the category of coffee pods due to the environmental impact of single-serve packs, making companies seek ecofriendly packaging. The response has come from companies like Honest Coffee Company, which developed a pod made of starch and plant fibers that decompose in 180 days.

As stated before, coffee shops deemed specialized in coffee have a great value. In addition, the market has shown growth year by year, historically recovering from a minor decrease in 2011-2012.
A trend seen in these outlets is a shift in their menus: before, this type of coffee shops offered only casual foods and hot drinks; the market contraction has made them expand their offer to dining options, competing directly with restaurants for the casual dining market. An example of this trend is The Coffee Club: previously a coffee shop focused only on coffee culture, now has a menu with a wide variety of meals and even a kids menu. 


Source: Euromonitor

Australasia’s potential for ethically sourced and organic coffees

Australia and New Zealand have long been important markets for specialty coffees, but now the features that make a coffee special have widened. Specialty coffees that are sustainable or ethically sourced, such as Colombian coffee, have great prospects in Australasia.

Café de Colombia has worked to strengthen its presence and industry awareness in this particular market. In 2015, Café de Colombia was present for the third time at Melbourne International Coffee Expo (MICE), the most important coffee fair of the region, where it showcased the diversity of profiles that Colombian coffee regions offer.

As a result, baristas and micro-roasters from this region have become more familiar with Colombian coffees. For example, Sasa Sestic, the current World Barista Champion, won his tittle using a coffee from Valle del Cauca, one of Colombia’s coffee-producing regions.

Additionally, through the Colombian Coffee Hub, more than 157 specialty coffee professionals from this region are acquiring their coffee knowledge from Colombia and the Colombian Coffee Growers Federation (FNC).

In sum, Australia and New Zealand are markets with great potential for 100% Café de Colombia brands. A strong demand for high-quality coffees, sustainable attributes and overall a sophisticated and developed coffee market offer interesting opportunities.

You are invited to learn more about our coffee family and our products, visiting the BEAN & BEYOND sections on the top of this page.