Agri Business

Despite rise in cafes, per capita consumption of coffee stagnates

Sangeetha Chengappa Bengaluru | Updated on October 01, 2018 Published on October 01, 2018

Coffee consumption is concentrated in the Southern States of Tamil Nadu (60 per cent) and Karnataka (25 per cent)   -  Getty Images/iStockphoto

Even as International Coffee Day — October 1 — was celebrated by retail coffee chains like Tata Starbucks and Cafe Coffee Day with much fanfare, the hard reality is that India’s per capita coffee consumption has not budged beyond 100 gm. In the US, per capita consumption is at 4 kg and in Finland, it is over 9 kg.

Cafe Coffee Day, with its network of 1,742 cafes pan- India in over 245 cities, has seen coffee sales soar from over 1.6 billion cups per annum in fiscal 2017 to over 2 billion cups per annum in fiscal 2018. Tata Starbucks has grown its customer reach to 2,50,000 customers a week across its network of 128 stores in seven cities within six years of entering the India market in October 2012. Growing sales in coffee cafes, has not translated to a rise in per capita coffee consumption.

“Most of the coffee promotions are done by the big boys in the business like Nestle, Hindustan Unilever, Tata Coffee etc for their respective coffee brands. However, there has been no concerted push to promote generic coffee especially in non-conventional coffee drinking regions in the North and West.

Coffee lovers of South

The Commerce Ministry is only geared to focus on exports and not on domestic consumption” says Anil Bhandari, Chairman of India Coffee Trust, a non-profit organisation formed by stakeholders of the Indian Coffee industry.

Coffee consumption is concentrated in the Southern States of Tamil Nadu (60 per cent) and Karnataka (25 per cent). Roasters and Grinders such as Cothas Coffee, Leo Coffee, Seven Beans Co, Kalmane Koffee, Fresh ‘n’ Ground, Flying Squirrel, Continental Coffee, among others are also South based, with very few operating in the North or the West. Even large, national supermarket chains stock roasted and ground coffees of big brands with little or no access to estate-specific, single origin brands to buy off the shelf.

“Youngsters and entrepreneurs may flock to coffee cafes but coffee is incidental. They visit these cafes for the great ambience, music, free Wi-Fi etc, which are ideal hangouts or meeting places. Unfortunately, they do not carry this habit back to their homes,” observed former Vice-Chairman and Member of the Coffee Board Bose Mandanna, who is a large coffee grower in Kodagu district of Karnataka. Moreover coffee is an expensive beverage and is cumbersome to prepare, added Mandanna.

According to Bhandari: “Brazil provided free coffee to school and college-going children for 10 years. By the time they became earning adults, coffee became a daily habit. If we decide to offer schools and colleges free coffee thrice a week for two years, consumption can easily be pushed up to 250 gm per capita.”

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Published on October 01, 2018
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