Indonesia Coffee Pods Market - Forecasts from 2023 to 2028

The Indonesian coffee pods market is estimated to grow at a CAGR of 4.51% to reach US$16.547 million by 2028 from US$12.153 million in 2021.

The increasing consumption of coffee and the increased presence of coffee-making machines in offices and corporate buildings are increasing the demand for coffee capsules in the country. Additionally, the Indonesian coffee pods industry is also increasing, owing to practicality, high quality, and multiple flavor options available to the users. Moreover, factors such as the increasing urban population and rising per capita income of the people in the country can also contribute to the increased growth of coffee pods in the projected period. For instance, according to the Rise of Metropolitan Regions: Towards Inclusive and Sustainable Regional Development by the World Bank estimated that by 2025, 67.5% means a total of 182.6 million of the Indonesian population will be living in urban areas. Hence, many such factors are expected to increase the growth of the Indonesian coffee pods market.

Increasing consumption among younger professionals

The increasing cafes and increased penetration of restaurants in the country coupled with the rising tourism industry in the country is giving rise to increased growth for coffee pods. Many tourists visit Indonesia and to entertain these tourists many cafes have started operating in tourist places such as Bali, Ubud, and Jakarta. For instance, according to the World Bank in 2021 two million people traveled to Indonesia, making it the 57th most traveled country in the year. The revenue generated from tourism in the same year was US$548.00 million in 2021. Additionally, coffee capsules are an environmentally friendly and bio-degradable option coupled with an increased number of coffee capsule manufacturers in the country, and increasing consumption of coffee is also expected to boost the Indonesian coffee pods market growth in the projected period.

Growth in the working population

According to the World Bank, the population aged from 15-64 is very high in the country. The working population also lies in this age group. The population aged from 15-64 years in the country makes up for almost 68% of the total population followed by 0-14 years 25.20% and lastly, 6.90% of people are aged 65 or above. In recent years major has been experienced among younger professionals they prefer going to cafes for coffee as it is considered an environment where people can meet and catch up. Taking advantage of these situations, many cafes and restaurants are expanding their business and trying to make their ambience as appealing as possible so that it can attract younger customers for them. Hence many such reasons are expected to boost the coffee capsules made in the country in the projected period.

Increasing consumption of flavoured coffee pods

Market producers are currently attempting to develop coffee pods that are flavoured owing to the changing consumer preferences. Hence, the market for flavoured coffee pods in Indonesia is expected to grow gradually throughout the forecasted time frame. According to the USDA Foreign Agricultural Service, due to the favourable weather in southern Sumatra, Indonesia is expected to produce 11.35 million (60 kilogram) bags more coffee in 2022-2023 than the previous year. In 2022-2023, it is anticipated that increased demand as a result of the relaxation of pandemic-related limitations will push domestic coffee consumption to 4.8 million bags.

Furthermore, growth in the sales volume of RTD coffee has significantly impacted the flavoured Indonesian coffee pods market. Several ready-to-drink (RTD) coffee manufacturers launched new product lines in 2021 that were more reasonably priced and came in smaller packets for consumers whose spending power had been lowered as a result of societal limitations brought on by the epidemic.

Products offered by key market players

Key players are focusing on product innovation of flavoured coffee pods in Indonesia owing to the changing consumer preferences. For instance, a touch of tropical woody smells cured tobacco notes, and a rich, velvety body can all be found in Master Origins Indonesia offered by Nespresso Indonesia. Additionally, the flavour profile of Sulawesi coffee is unique, delivering a rich, full-bodied, and earthy taste. The drying technique used gives the coffee a low acidity level and a distinctive smoky taste. Dark chocolate, caramel, and traces of fruitiness are among the flavours of coffee that are frequently mentioned. The Nespresso VertuoLine Sulawesi coffee pod is well-liked; it has a smooth and well-balanced flavour profile with hints of spice and dark chocolate. Moreover, a fantastic alternative to this is the medium-roasted, robust, and smooth Keurig K-Cup Sulawesi coffee pod from Copper Moon.

Market Key Developments

• In November 2022, Nescafe Dolce Gusto, which has distribution centers in Indonesia launched Neo. Neo combines high quality, sustainable, and cutting-edge technology that can create a cafe like experience at home, and these coffee pods are paper-based, home compostable, and use 70% less packaging by weight compared to their current capsule.

Segmentation:

By Type

• Hard Pods
• Soft Pods

By Caffeine Content

• Regular
• Decaffeinated

By Flavour

• Regular
• Flavoured

By Distribution Channel

• Offline
• Online