Russia’s instant coffee market is expected to grow at a compound annual growth rate of 4.42% over the analyzed period to reach a market size of US$2864.219 million in 2027 from US$2116.587 million in 2020.
The rising number of consumers of different types of coffee, specifically instant coffee, has led the beverage to gain popularity in the country and pulled the Russian instant coffee market to a significant position in Europe
Russia is considered to be one of the largest instant coffee consumers in the European region. The popularity of coffee has grown and has slowly ingrained itself into the lives of individuals. One of the leading players, Strauss Coffee Russia, has acquired the Chernaya Karta brand in the Russian coffee market landscape to cater to the different demands of the consumers and the rising popularity of coffee in the country. In addition, healthier variants are also being made available, such as coffee with added chicory or green coffee extract.
Moreover, the consumption of tea has fallen slightly as some of the tea consumers in the country have shifted to drinking instant coffee due to its greater health benefits, better and richer taste, and the convenience associated with the preparation of coffee. This can also be attributed to the influence of the culture of other European countries, which has spread into the country by the younger population. Thus, these factors are driving the rising demand for instant coffee and are augmenting the market’s growth.
Product Offerings by the market players in the Russian instant coffee market
The offering of better and more advanced varieties of instant coffee with enhanced flavours and aromas, among others, by existing and new players in different markets is estimated to lead to increased adoption and propel the market growth further over the forecast period.
Some of the product offerings have been mentioned below-
COVID-19 Insights
COVID-19 had a negative Russian instant coffee market. The rise in infected cases and enforcement of lockdown led to the closure of the coffee houses, food houses, institutions, and corporations, among many other public places, causing the sales to decline in these segments. The volatile prices of coffee also had a significant impact on the market. However, owing to the rapid development of the e-commerce industry, the market experienced a boost in online sales. Nonetheless, this led to boosted sales in the domestic segment.
Russian-Ukraine War Impact:
The war between Russia and Ukraine had a negative impact on the coffee market. The plunge in share prices during the period caused many brands to quit or reduce investments in the region. In May 2022, for instance, Starbucks announced its exit from Russia. Consequently, Starbucks' 130 franchises and stores were shut down. At the same time, companies like Nestles had announced their plans to halt investments in Russia in the near future.
Segmentation