Mixed performance for hot drinks in Canada
In 2025, hot drinks in Canada recorded a modest decline in retail volumes for the third consecutive year, while value sales grew at a slower pace than the inflation-driven peaks of 2022–2023. Elevated prices persisted despite easing inflation, fuelled by volatile commodity costs linked to climate change and tariffs. Weak economic conditions, low population growth, and cautious spending further constrained demand, with consumers prioritising value and necessity over indulgence. Health-conscious behaviours reshaped category dynamics: sugar-heavy options such as chocolate-based drinks continued to decline, while fruit/herbal tea gained traction for its functional benefits. Premiumisation supported value growth in fresh coffee and tea, as Canadians sought high-quality, artisanal blends. Foodservice remained under pressure, with at-home preparation preferred for cost savings. Looking ahead, moderate volume growth and robust value gains are expected, driven by premium coffee formats, instant mixes, and wellness-focused teas, despite demographic and climate-related challenges.
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Overview:
Understand the latest market trends and future growth opportunities for the Hot Drinks industry in Canada 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 Canada, 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 Canada 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 Canada?
- To what extent are health considerations impacting consumption of Hot Drinks in Canada?
- What are the traditional preferences in Hot Drinks in Canada? 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 Canada?
- Which are the leading brands in Hot Drinks in Canada?
- How are products distributed in Hot Drinks in Canada?
- 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 Canada
Mixed performance for hot drinks in Canada
KEY DATA FINDINGS
Further volume declines driven by rising prices due to elevated input costs
Health and wellness trend influences purchasing decisions
Indulgence and luxury offer comfort in an unstable period
Canadians invest in at-home preparation for customisation and cost savings
Despite positive outlook, challenges will remain
Health and sustainability trends to support value growth
Coffee players retain overall lead of competitive landscape
Pockets of dynamic growth as players focus on health and premium options
Grocery retailers offer consumers convenience when purchasing hot drinks
E-commerce gains complement omnichannel strategies
Foodservice vs retail split
COUNTRY REPORTS DISCLAIMER
Coffee in Canada
KEY DATA FINDINGS
Mixed performance for coffee due to various challenges
Further rise in unit price drives up value while dampening retail volumes
Extending the use of coffee machines at home with iced preparations
Canada’s strong coffee culture continues to support overall demand
Positive outlook for coffee but challenges will remain
Replicating café experience at home to remain a key trend in Canada
Sustainability trend to encourage responsible sourcing
Coffee’s competitive landscape remains fairly consolidated in 2025
Nestlé Canada continues to focus on offering consumers convenience
Premium segment driven by sourcing and smaller players with flavour variety
Rising health-consciousness encourages new product development
Grocery retailers dominate distribution, offering convenience for regular shoppers
E-commerce continues to make gains to align with omnichannel models
Tea in Canada
KEY DATA FINDINGS
Mixed performance as tea continues to mature in Canada
Black tea continues to drive retail volume declines due to lack of innovation
Health and wellness trend continues to support dynamic fruit/herbal tea
Retail volumes to resume growth but challenges remain
Functional benefits and sustainability to be stronger growth areas
Addressing demand for customised experience and premiumisation can provide fuel for growth over the long term
Tata Global Beverages retains leadership of highly fragmented landscape
Tea players venture out of category for new growth areas
Tea specialists remain popular destination for premium options
E-commerce’s penetration of tea continues to rise
Other Hot Drinks in Canada
KEY DATA FINDINGS
Other hot drinks struggles with long-term challenges to growth
Other hot drinks experiences volume contraction while value growth moderates
Malt-based hot drinks attempt to appeal to health-conscious consumers
Other hot drinks to be further challenged by health trends and changing demands
Potential for expanding consumption occasions
Sugar aversion and front-of-label packaging requirements pose challenges
Nestlé Canada continues to dominate competitive landscape
Smaller players focus on premium growth segments
Supermarkets dominates distribution while discounters gains amid price concerns
Further share gain for convenient e-commerce
COUNTRY REPORTS DISCLAIMER
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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This report originates from Passport, our Hot Drinks research and analysis database.
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