The hot drinks market is expected to see flat growth in total volume terms in 2024, driven by soaring unit prices that have outpaced those of 2023. This trend is primarily fuelled by rising costs of coffee, cocoa, and sugar, exacerbated by adverse weather conditions linked to climate change, including prolonged droughts, excessive rainfall, and rising temperatures.
Rising prices, particularly in essential commodities like sugar and coffee, are significantly impacting consumer purchasing habits in Indonesia. Price-sensitive consumers are becoming more cautious with their spending, prompting a shift from premium coffee options to more affordable alternatives like instant coffee mixes.
Santos Jaya Abadi PT remains the leading player in Indonesia's hot drinks market in terms of retail value, benefiting from its extensive distribution network that ensures widespread availability across both traditional and modern retail channels. However, heightened price sensitivity, driven by ongoing suboptimal economic conditions, has increased competition in 2024, particularly in staple hot drinks categories like standard fresh ground coffee and black tea.
Small local grocers remain the preferred shopping channel for hot drinks in Indonesia and are expected to strengthen their share of retail volume sales in 2024. These outlets offer a more informal and personalised shopping experience compared to larger retailers like supermarkets and hypermarkets.
Retail continues to account for an unusually high proportion of total hot drinks volume sales. While foodservice outlets are experiencing stronger growth compared to off-trade channels, demand is not expected to exceed pre-COVID-19 levels until 2026.
Volume sales of hot drinks in Indonesia are expected to experience only modest growth over the forecast period, primarily due to sluggish consumer sentiment amid ongoing suboptimal economic conditions. The new Indonesian government’s policies on inflation and taxation will be crucial in shaping the market, influencing both consumer spending habits and business operations.
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Understand the latest market trends and future growth opportunities for the Hot Drinks industry in Indonesia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
Data and analysis in this report provides further detailed coverage dedicated to the following key categories, where applicable:
If you're in the Hot Drinks industry in Indonesia, our research will help you to make informed, intelligent decisions; to recognise and profit from opportunity, or to offer resilience amidst market uncertainty.
Hot Drinks
This report originates from Passport, our Hot Drinks research and analysis database.
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