SA’s coffee market trading up

For a growing number of SA coffee drinkers any old instant brew is no longer good enough. “Coffee drinkers’ demands are becoming increasingly sophisticated,” says Paul Hanlon, MD of Ciro Beverage Solutions, a unit of AVI.

Instant coffee made from a mixture of cheaper robusta coffee, chicory and dextrose still dominates the SA market. But, says Hanlon, many people are “trading up” to pure and mixed ground coffees, usually made from far more expensive arabica beans.

Espresso has become the big thing among discerning coffee drinkers, says Malcolm Clark, MD of Caribbean Coffee, one of Cape Town’s largest private up-market coffee producers. “SA is following the trend in Australia, where espresso has something of a cult status,” he says.

In the away-from-home ground coffee sector, Hanlon says, volume is growing at about 5%/year and the value of sales at just below double digits. A big driver of growth is filling station convenience stores, where a quality coffee offering is now a standard feature. Fast-food restaurants are also getting in on the game. “Last year we provided a solution to KFC in 250 of its restaurants,” says Hanlon.

The impact of convenience stores and fast-food restaurants is significant. The volume of quality coffee sales in these two sectors grew by more than 50% over the past 12 months, he adds.

There is more to quality coffee than just grinding up a few beans and adding water and milk. “The best beans perfectly roasted will produce a terrible cup of coffee in the hands of someone who does not know how to use them correctly,” says Clark.

Hanlon shares this view. “Ensuring the quality of the end product is vital,” he says. “This is why we see our role in training staff as probably the most important service we provide.”

Greater availability of quality coffee may just provide the visibility boost the market needs. According to the World Resource Institute, in terms of coffee consumption per capita SA ranks 105th in the world.

Source: Financial Mail