1.1 Presentation and definition of the market

Coffee is an energy drink that is obtained from the roasted seeds of the coffee tree. It is believed that coffee was discovered in prehistoric times, by inhabitants of the Kaffa region in Ethiopia. It was then transported to Yemen in the 6th century.

Coffee consumption began in earnest in the 15th century in Yemen, then spread to the Arabian-Ottoman kingdom, and finally reached Europe. It is the second most traded commodity in the world after oil and the most consumed drink after water. World consumption was estimated at 9 million tons in 2018, equivalent to 2 billion cups consumed every day. Brazil, the United States, Japan, Western and Northern European countries are the largest consumers of coffee, while most of the world's production comes from Brazil, Vietnam, Colombia and Indonesia. In general, production takes place on small farms of less than 5 hectares.

France is a mature market that continues to increase in value thanks to the increasing differentiation of products through different tastes and packaging. Market concentration is high and companies leading the way include Nestlé, JDE and Lavazza.

Organic coffee continues to have a low penetration and growth rate in France, but could be one of the segments that drives the market in the medium term. This dynamism seems to be taking shape in 2020 as the propensity of organic coffee seems to be increasing. The Covid-19 pandemic has changed the paradigm of French consumption habits, insofar as since the health crisis, the French are seeking to consume in a healthier way. This has resulted in an increase in the turnover of organic coffee and also in an increase in the supply of organic coffee.

1.2 A growing global market (dominated by Europe)

According to Universalis, world coffee production increased from * million tons in the mid-****s to *.** million tons in the early ****s. Today, global coffee consumption is almost ** million tons and the International Coffee Organization (***) estimates global coffee production at *** million bags in ****, up *.*% from ****.

Like other raw materials from agriculture, global ...

1.3 French market driven by price increases

In France, in ****, the average French person consumes the equivalent of *.* kg of coffee beans per year, placing the nation **th in the world. Finland is the largest consumer with ** kg per year. In France, in ****, **% of the population reported consuming coffee.[***]

The graph below reveals the coffee sales in France ...

1.4 Foreign Trade

The international coffee trade is not dominated by direct relations between producer and consumer countries. Indeed, the transformations that coffee beans undergo before reaching the final consumer (***) allow intermediate countries to integrate into the world market. Thus, Switzerland, thanks to the presence of Nestlé and Nespresso, is a major player in ...

1.5 The effects of the Covid-19 pandemic on the coffee market

The effects of the health crisis on the consumption of CHR (***)

According to the report of the coffee union, the turnover of the coffee sector in the CHR has experienced a decline of **.*% in the year ****. Some companies exclusively focused on the coffee market have experienced a drop in turnover of ...

2.1 The French consumer

In this section, we aim to shed light on the preferences and characteristics of French consumers. Generally speaking, coffee consumption in France is high: **% of the population said they enjoyed this beverage in ****, and **% of men and **% of women admit to being coffee fans. For people over **, the penetration rate is ...

2.2 Key demand factors

Coffee consumption can be divided into three main segments: firstly, roasted coffee (***) which is the traditional way to consume coffee. Secondly, we find the coffee pods such as espresso, Senseo or other. Finally, we have the soluble or instant coffee which is usually in powder form.

Market share in volume in ...

2.3 Demand trends

Product differentiation

In France, recent market trends show that demand is strongly correlated with product differentiation. The latter is part of a very mature market.

Indeed, to achieve this, manufacturers are increasingly seeking to move upmarket. Aspects such as the quality of the aroma, the "terroir" associated with the origin of ...

2.4 The French's favorite brands

Answer to the question: Which of these brands do you like? France, ****, in % Source: ****

Among the ** most popular brands in France, Carte d'Or, L'Or and Nespresso are the top three, while the generalist brand Alter Eco concludes the ranking of the French's favorite coffee brands.

Answer to the question: do you ...

2.5 The French's favorite coffee brands

The graph below presents the favorite coffee brands of the French.

Carte Noire is the favorite coffee brand of the French with an appreciation rate of **.*% while Alter Eco is the least appreciated with a rate of **.*%.

The French's favorite coffee brands France, March ****, in Source: ****

For the graph below, we ...

3.1 Value Chain

3.2 Coffee production process

The coffee production process consists of * stages

The harvest

The harvest consists of picking the ripe fruits of the coffee tree, commonly called cherries for their orange-red color. The harvesting periods can last several months. On average, it is considered that a coffee tree produces *.* kg of coffee cherries per year, ...

3.3 Coffee processing

Thanks to the NAF code **.**Z "Processing of tea and coffee", we can with the data of the Acoss know that between **** and ****, the number of companies in this sector is slightly increasing in France (***). This is due to the fact that the market remains very concentrated, creating a tough competition ...

3.4 Coffee distribution

Distribution of coffee for home consumption

In ****, the top five distribution channels in France were: hypermarkets and supermarkets with **% of the market share, followed by hard discounts with **%, e-commerce with *% and finally convenience stores with *%.

Distribution channels for coffee for home consumption France, ****, in % Source: ****

The concentration of the market can ...

4.1 The different segments: the rise of portionable coffees

The Arabica/Robusta distinction

There are two main varieties of coffee: Arabica, which grows at higher altitudes (***) and is the most cultivated, and Robusta, which grows at lower altitudes and is more concentrated in caffeine. on a global scale, in ****/**** almost **% of the production was Arabica while the rest was ...

4.2 The price

The graph below shows the evolution of the price of coffee in France. The base value is *** in ****. If the index value increases to ***, this is equivalent to an overall price increase of *%. Following this logic, we see that, on average, coffee prices for coffee beans or ground coffee have increased ...

5.1 Regulatory framework

International standards exist for the production, trade and consumption of coffee. The International Coffee Agreement, which was concluded between the ** members of the International Coffee Council in **** and entered into force in ****, aims to promote international cooperation in the coffee market in order to develop a sustainable coffee economy and promote ...