Cold Brew Coffee Market Size, Share, Industry, Forecast and outlook (2024-2031)

Global Cold Brew Coffee Market is Segmented By Coffee Beans Type (Robusta, Arabica, Liberica), By Distribution Chanel (Online, Offline), By Region (North America, Latin America, Europe, Asia Pacific, Middle East, and Africa) – Share, Size, Outlook, and Opportunity Analysis, 2024-2031

Cold Brew Coffee Market Overview

Global Cold Brew Coffee market to grow at a high CAGR  during the forecast period 2024- 2031. The competitive rivalry intensifies with Nestle, Starbucks Corporation., Cuvee Coffee, and others operating in the market.

Cold-brew is a beverage that consists mostly of pure coffee concoction, milk and ice, but can be mixed with various food items while making cold coffee, such as ice creams, cookies, sprinkles and whipped cream. Cold-brew is prepared after coffee beans are left to soak in room temperature water for at least a day. Cold-brew is a popular drink in many specialty coffee shops around the world. This is mainly due to the demand from millennial coffee drinkers, who make up a sizable amount of the world's coffee-consuming population. In addition to that, many consumers choosing it as an alternative to soda in the ready to drink (RTD) sector. Even beverage giants like Coca-Cola, Illycaffe and Nestle have created their versions of cold-brew. Cold-brew evolves into an even more premium status with the introduction of nitrogen and the use of draft systems in coffee shops. The specialty coffee industry has started to view cold brew as a "unique premium beverage".

Cold Brew Coffee Market Scope

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Cold Brew Coffee Market Industry Dynamics

Expanding consumer preference for unique coffee beverages is likely to favor the market growth

Cold brew coffee has become commonplace across the foodservice spectrum on the heels of ready-to-drink coffee and iced coffee growth. They are easy to make and customizable according to the customer's needs. Many younger consumers are driving interest in cold coffee beverages. Allegra's World Iced Coffee 2020 report noted that although early adopters of cold brew were younger consumers, category consumption is growing rapidly across age groups, up 29% among consumers ages 45-59, 27% among ages 30-44 and 27% under 30. Evidence of increased drinking occasions and incremental sales are also pointed out by Allegra's World Iced Coffee 2020, in which 45% of surveyed consumers said they make other food or snack purchases alongside cold coffee beverages. According to the National Coffee Association, 58% of consumers who have not tried cold brew yet are aware of it, which means many sampling opportunities would extend to workplaces foodservice facilities. The introduction of nitro charged cold brew beverages is opening a wide range of opportunities for industry leaders. In 2016, Starbucks added nitro lines to 2,500 of its 8,500 U.S. stores, and soon they’ll be installed in every single U.S. location.

Risks of handling cold brew coffee are likely to hinder the market growth

Cold-brew has a pH value greater than 4.6 (typically 4.9–6.0), which is a low acidity and does not effectively suppress microbial growth. Therefore, foodborne pathogens (i.e., human illness-causing microorganisms) or spoilage organisms, which mainly affect flavor, may develop in cold brew. Some initial experiments showed that compounds might inhibit the growth of pathogens in the coffee, but this must be confirmed for each preparation. Spoilage organisms such as molds and yeasts appear not to be inhibited and may increase quickly during storage leading to fermentation. Most sensitive products are ready-to-drink beverages, especially those prepared under anaerobic conditions. These products must be closely controlled to mitigate the risk of Clostridium botulinum (botulism) by either pH control or thermal processing. The product "Death Wish" nitro cold brew was recalled from the market in September 2017. It was determined that its production process could lead to the growth and production of botulinum toxin in this low-acid food commercialized in reduced oxygen packaging. Most commercial cold brews in the market require refrigeration for both storage and dispensing.

Cold Brew Coffee Market Segmentation Analysis

The demand for Arabica coffee beans is likely to grow at a rapid rate

Arabica beans are far more superior to robusta in terms of flavor and aroma. Arabica coffee beans are more acidic and fruity in taste which creates a bright and open taste. Arabica has more oils and sugars than Robusta, which is one of the big reasons why most people prefer it. Arabica beans also have a low caffeine content of approximately 1.7%, while robusta beans have up to 3%. Arabica coffee accounts for about three-quarters of coffee cultivated worldwide. Despite the Robusta beans inherent trait of being able to produce more harvest than the arabica beans, arabica beans compose over 75 percent of the total coffee beans produced in the entire world. In 2020/21, worldwide Arabica coffee production amounted to about 102.1 million 60-kilogram bags. It is grown throughout Latin America, Central and East Africa, India and, to some extent, Indonesia. Brazil was the world's largest coffee producer in the year 2020. Producing 3,558,000 metric tons (7,844,000,000 pounds) of coffee, Brazil accounted for around one-third of the world's coffee. Arabica makes up 69% of Brazilian coffee, with Robusta making up the remaining 31%.

Cold Brew Coffee Market Geographical

North America is expected to dominate the global cold brew coffee market in the year 2020

The United States dominated the North America cold brew coffee market. The development of cold brew represents US coffee industry's major innovations over the recent years. The product is now a backbone of most major coffee operator menus, gaining significant traction among consumers, particularly among younger people. More than 80% of industry leaders surveyed and identified cold brew as the fastest-growing product in coffee shops. Iced beverage sales comprise more than one-fifth of USD 47.5 billion US branded coffee shop revenues and now outpace hot coffee sales growth, which increased 4.8% during 2019. Moreover, branded chains are driving the popularization of iced beverages. More than 90% of US consumers purchased an iced coffee beverage at either Starbucks, Dunkin' or McDonald's last year. According to a survey conducted by 62% of industry leaders, the introduction of nitro cold brew coffee experienced more modest success, is less widely available and yet to permeate the mainstream within the next three years. Many market leaders like Dunkin' and Tim Horton’s are likely to launch a new nitro cold brew coffee range. Recently Starbucks introduced a range of ‘Cold Brew’ beverages.

Cold Brew Coffee Company and Competitive Landscape

The global cold brew beverages market is competitive with the presence of local and global companies.  Some of the key players contributing to the market's growth include Nestle, Banjo Cold Brew Coffee, The Great Lakes Coffee Roasting Company, Station Cold Brew Coffee Co., Starbucks Corporation, White Wave Foods, JC Younger and CoffeeTech Industries, among others. The major players are adopting several growth strategies such as product launches, acquisitions, and collaborations, which contribute to the growth of the cold brew beverages market globally. For instance, New Jersey-based cold brew manufacturing company BKON secured a USD 3 million investment by Pennsylvania-based beverage packaging and dispensing company Good West Industries. This investment will be used to expand production capacity at its Moorestown, New Jersey, manufacturing center. Nestlé USA acquired Chameleon Cold-Brew, an organic manufacturer of ready-to-drink coffee and coffee concentrate products. In addition to that, Chameleon Cold-Brew recently launched its newest beverage line, Organic Chameleon Cold-Brew Coffee with Milk which are available at select Target and Super Target locations in the US. White Wave Foods entered into the cold-brew coffee category with the launch of STōK, a new line of RTD iced coffees. The company launched the brand with two multi-serve offerings that are distributed in selected U.S. markets. White Wave debuted three single-serve varieties and is planning for a national rollout of all five products.

COVID-19 Impact on cold brew coffee market

At an international level, coffee producers and traders have seen significant changes in coffee markets. There has been increase in international coffee prices as countries stockpiled coffee beans in case supply chains are hit harder by COVID-19. In countries like Brazil and Colombia, coffee sector has been considered as essential sector continuing to work during the pandemic. Lack of social outings affected the market. The pandemic left cafes, offices and campuses across the countries closed for months, which resulted in decreased sales during that time as out-of-home coffee consumption makes up around 25% of total consumer demand for coffee.

On the bright side, the coronavirus has resulted in more coffee being consumed at home as many consumers are working from home. Consumers also are becoming more health-conscious these days, so they are opting for RTD coffee instead of high-sugar and carbonated beverages. Cold-brew RTD beverages are on the rise in the market and are typically seen as a premium products. According to National Coffee Association USA, 75 percent of coffee drinkers said the pandemic has not changed their coffee consumption.  For those who have changed habits, the most reported change is making more coffee at home. Hence, many coffee manufacturers have launched a new line of premium functional cold-brew shots in line with the trend toward more healthful formulations. Humblemaker Coffee Co. launched three varieties of cold-brew drinks under the names Boomtowne, La Fonda and the Black Sea.