Hot drinks in 2024: The big picture
The impact of inflation in Australia is slowing in 2024, as indicated by insights from Euromonitor International’s Economics and Consumers system. Commodities such as sugar, coffee, and tea show a downward trend, helping to moderate unit prices in 2024 and contributing to more modest value growth.
2024 key trends
The health and wellness trend remains a pivotal force shaping hot drinks in Australia. Functionality has emerged as a key component of innovation, as consumers prioritise wellness spending, even during challenging economic times.
Competitive landscape
Nestlé Australia retains its lead of hot drinks in Australia, supported by a comprehensive product portfolio that includes coffee and other hot drinks. The player is investing in the expansion of its Smithtown factory, which produces Milo, Nesquik, Nestlé Malted Milk, and Nescafé mixes, with the aim of modernising production lines and increasing overall capacity.
Retailing developments
Supermarkets remains the primary channel for the distribution of hot drinks in Australia, operating within a duopoly dominated by Coles and Woolworths. However, leading supermarkets have faced scrutiny from the Australian Competition and Consumer Commission due to allegations of price gouging, with claims that customers are being misled by deceptive pricing practices on over 500 popular products.
Foodservice vs retail split
In 2024, volume sales of hot drinks through foodservice continue to record slow growth, with overall demand through the channel remaining significantly lower than pre-pandemic levels, largely influenced by the ongoing cost-of-living crisis. Younger Australians, in particular, are reducing their spending on dining out and shifting towards home consumption of hot drinks.
What next for hot drinks?
Hot drinks in Australia is poised for a return to stronger volume growth over the forecast period as economic conditions improve, likely prompting consumers to revert to their historical purchasing patterns. Coffee will remain resilient, benefiting from Australians' enduring preference for this hot drink.
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Overview:
Understand the latest market trends and future growth opportunities for the Hot Drinks industry in Australia 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:
- Coffee
- Tea
- Other Hot Drinks
If you're in the Hot Drinks industry in Australia, our research will help you to make informed, intelligent decisions; to recognise and profit from opportunity, or to offer resilience amidst market uncertainty.
The Hot Drinks in Australia report includes:
- Analysis of key supply-side and demand trends
- Detailed segmentation of international and local products
- Historic volume and value sizes, company and brand market shares
- Five year forecasts of market trends and market growth
- Robust and transparent research methodology, conducted in-country
This report answers:
- What is the market size of Hot Drinks in Australia?
- To what extent are health considerations impacting consumption of Hot Drinks in Australia?
- What are the traditional preferences in Hot Drinks in Australia? To what extent are these tastes changing amidst increasing international influence and the growth of chained cafés?
- How are changing demographics (for example, an ageing or predominantly young population) determining consumption of Hot Drinks in Australia?
- Which are the leading brands in Hot Drinks in Australia?
- How are products distributed in Hot Drinks in Australia?
- How is the rise of e-commerce changing the retail and competitive landscape?
- Have home seclusion and social distancing measures following COVID-19 benefited sales of Hot Drinks?
- Where is future growth expected to be most dynamic?
Hot Drinks in Australia
Hot drinks in 2024: The big picture
2024 key trends
Competitive landscape
Retailing developments
Foodservice vs retail split
What next for hot drinks?
DISCLAIMER
Coffee in Australia
KEY DATA FINDINGS
Inflation-induced value growth stabilises while demand remains flat
Australian consumers demand an ethical and high-quality coffee experience
Aldi leads the surge in premium private label coffee
Retail volumes set to rebound as premiumisation drives value up
Cold brew and RTD coffee to place pressure on traditional coffee options
New brewing tech revolutionises on-the-go coffee solutions
Tea in Australia
KEY DATA FINDINGS
Black tea and green tea face headwinds
Health and wellness trend continues to drive innovation
Retail dominates tea consumption, while e-commerce drives channel growth
Tea producers will focus on embracing eco-friendly practices
Indulgence and convenience are set to propel growth of instant tea
Expanding health and wellness focus will unlock new growth opportunities
Other Hot Drinks in Australia
KEY DATA FINDINGS
Retail demand for other hot drinks remains above pre-pandemic levels despite ongoing challenges
From low calories to functional powerhouse
Sustainability drives transformation in other hot drinks
Other hot drinks to face further challenges amid declining birth rates and health trends
Sustainability and e-commerce will become future growth drivers
Functional formulations are set to be the next growth frontier
The following categories and subcategories are included:
Hot Drinks
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- Fresh Coffee Beans
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- Fresh Ground Coffee Pods
- Standard Fresh Ground Coffee
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- Instant Standard Coffee
- Instant Coffee Mixes
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- Loose Black Tea
- Tea Bags Black
- Fruit/Herbal Tea
- Green Tea
- Instant Tea
- Other Tea
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- Chocolate-based Flavoured Powder Drinks
- Malt-based Hot Drinks
- Non-Chocolate-based Flavoured Powder Drinks
- Other Plant-based Hot Drinks
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Why buy this report?
- Gain competitive intelligence about market leaders
- Track key industry trends, opportunities and threats
- Inform your marketing, brand, strategy and market development, sales and supply functions
This report originates from Passport, our Hot Drinks research and analysis database.
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