Hot Drinks Market Snapshot

“The Hot Drinks Market to grow from USD 193.34 Billion in 2023 to USD 324.23 Billion by 2030, at a CAGR of 6.2%.”

The demand for high-quality beverages, such as green tea, lemon tea, and detox coffee and tea, is on the rise due to growing health consciousness. This is driving the market for hot drinks, which are expected to expand due to the introduction of health-promoting hot beverages.

Additionally, the installation of coffee vending machines in offices and corporate spaces is expected to further fuel demand for hot beverages.

The market for hot beverages is expanding due to rising awareness of the negative consequences of carbonated drinks and the health benefits of hot beverages like coffee and tea in reducing dangerous conditions like diabetes, blood pressure, and obesity.

Manufacturers are enhancing their product offerings and customer base by using certified components and products. They are also producing innovative tea and coffee flavors with health benefits, contributing to the growth of the hot drink market.

The demand for green tea is expected to rise due to consumers' shift towards de-stress and detox drinks due to hectic lifestyles and increasing cigarette consumption. Additionally, producers are introducing cutting-edge products like instant coffee, which requires only hot water, milk, and sugar, attracting corporate employees and increasing the market.

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The worldwide hot drinks market

The hot drink market, accounting for one-fifth of the global drinks business, is expected to generate $620 billion in revenue in 2019. Despite its lower value compared to alcoholic and non-alcoholic beverages, it has seen significant growth in new formats like capsules and pods.

The market is currently seeking development drivers in natural health, detox, organic, and fair trade sectors, with both large and smaller businesses expected to enter these niches.

Leading hot drink industry companies are expanding their market presence through distributors and focusing on rebuts and an extensive supply chain, which is expected to increase demand for hot drinks over the projection period.

COVID-19 Impact on Hot Drinks Market

The hot drink industry relies on raw ingredients from worldwide sources. National lockdowns have led to a significant supply-demand gap, affecting producers and manufacturing facilities. Social distance standards also limit capacity.

The market for hot beverages is fluctuating, with hoarding increasing demand in developed areas and decreasing demand in emerging economies due to high unemployment and rising prices. This has led to significant fluctuations in the hot beverage market.

Segment Analysis

Segment by Type

Coffee

Coffee, a dark, bitter, and slightly acidic beverage made from roasted coffee beans, is known for its caffeine content and energizing properties. Unroasted green coffee beans are separated from the fruits of the Coffea plant, roasted, crushed, and soaked in hot water before being filtered. Coffee is served hot, cold, or iced, and has the largest global sales in hot drinks.

Tea

French people continue to consume tea and herbal tea, with two in three drinking tea on average and one in two drinking herbal tea. Despite an annual consumption of 230 g per person, the French tea market is far behind the British market, which consumes 2.3 kg per person. Green tea is valued for its health advantages, and well-known companies like Tetley, Twinings, and Lipton dominate the industry.

Growth Drivers

The population is experiencing a rise in the consumption of tea and coffee.

The global demand for tea and coffee is expected to increase due to their natural content and therapeutic properties, leading to the expansion of the hot drink market. This growth is expected to be fueled by increased consumption in households, offices, and cafés.

The global hot drink market is expected to grow due to the increasing number of workers, demand for ready-to-use items, and the expansion of retail marketplaces. The growth is also anticipated due to the increasing use of natural hot drink ingredients like tea and coffee extracts in cosmetics.

Restraints

The hot beverage sector's expansion could be slowed by fluctuating raw material prices, particularly during winter, which is a favorable time for hot beverages. This could also impact summer sales in many countries, as excessive consumption can lead to addiction and anxiety, limiting growth.

Opportunity

Consumers are becoming more aware of product origins and manufacturing processes, leading to increased awareness of waste management and environmentally friendly practices. The development of recyclable packaging materials will demonstrate long-term progress in the industry, as single-use plastics are prohibited in many countries.

Competitive Landscape of the Hot Drinks Market Analysis

• The Coffee Bean & Tea Leaf (U.S)
• Unilever (U.K)
• Gourmesso (U.S)
• Harney & Sons Fine Teas (U.S)
• Dualit (U.K)
• Nestlé SA (Switzerland)
• Dilmah Ceylon Tea Company PLC (Sri Lanka)
• Ippodo Tea Co. Ltd. (China)
• Tranquini (U.S)
• Chillbev (U.S)
• Som Sleep (U.S)
• Phi Drinks, Inc. (U.S)
• com (U.S)

New Developments in Hot Drinks Market

OCT 31, 2023- Nestlé makes further headway in shaping a waste-free future

Nestlé has made considerable progress in reducing its packaging, creating better packaging, and improving waste management. Since signing up to the Global Commitment on plastic waste five years ago, the company and other leading signatories have significantly outperformed the market at large in reducing virgin plastic and increasing recyclability, according to the latest report from the Ellen Macarthur Foundation.

"We are continually pursuing better packaging solutions where we can have a direct impact," said Antonia Wanner, Nestlé's Head of ESG Strategy and Deployment. "With our in-house packaging experts and scientists, we are developing the next generation of packaging materials as well as redesigning packaging for the circular economy. In addition, we promote better infrastructure systems for waste management, advocate for harmonized regulation, and encourage behavioral change."

J.M. Smucker Co. and JDE Peet's announced a strategic partnership in March 2021, allowing JDE Peet's to support the Smucker Away From Home liquid coffee business with product development, production, and food service equipment innovation.

To promote equity and differentiation, FNC launched a line of coffees produced by women in December 2021.

Starbucks, in collaboration with PepsiCo Inc., launched ready-to-drink Starbucks Nitro Cold Brew cans in February 2020. The Nitrogen-infused drinks are available in three flavours: black, vanilla sweet cream, and dark caramel.

Regional Analysis of Global Hot Drinks Industry

In 2022, Asia Pacific hot drink market, which dominated in 2022, is predicted to grow at a CAGR of 7.6% due to increasing retail and franchise locations. Brand recognition is a key driver of market expansion.

The growing number of millennials is a crucial audience for the global hot drink market, driven by the popularity of organic hot drinks and rising product visibility. The market is also expected to be driven by rising tastes and smells.

In 2022, Europe dominated the hot beverage market, driven by rising demand for coffee pods and a significant UK market for instant coffee. North America's growing popularity of ready-to-drink tea products, including bags and capsules, is also contributing to market growth. Obesity, affecting 6% of Americans, could drive consumers to switch from soda-related drinks to hot beverages, potentially driving market growth in this area.

Segments Covered in the Hot Drinks Market Report

Hot Drinks Market Segment by Type

• Coffee
• Tea

Hot Drinks Market by End User

• Coffee Shops
• Drink Stores
• Food Services

Hot Drinks Market by Distribution Channel

• Hypermarkets
• Supermarkets
• Convenience Stores
• Department Stores
• Dollar Stores
• Variety Store
• Cash and Carries and Warehouse Clubs
• Food and Drinks Specialists
• Drug Stores and Pharmacies and Health and Beauty Stores

Hot Drinks Market by Region

• North America
  • US
  • Canada
• Europe
  • Germany
  • France
  • UK
  • Italy
  • Spain
  • Rest of Europe
• Asia-Pacific
  • China
  • Japan
  • India
  • Australia
  • South Korea
  • Australia
  • Rest of Asia-Pacific
• Rest of the World
• Middle East
• Africa
• Latin America

Frequently Asked Questions

What does Hot Drinks do?

Drinking hot water or hot lemon water is beneficial for maintaining hydration, easing congestion, improving digestion, reducing stress, and feeling warmer. Both hot and cold water are essential for maintaining body health and hydration.

What is the expected growth rate of the Hot Drinks market over the next 7 years?

The Hot Drinks Market to grow from USD 193.34 Billion in 2023 to USD 324.23 Billion by 2030, at a CAGR of 6.2%

Who are the major players in the Hot Drinks market and what is their market share?

The Coffee Bean & Tea Leaf (U.S), Unilever (U.K), Gourmesso (U.S), Harney & Sons Fine Teas (U.S), Dualit (U.K), Nestlé SA (Switzerland), Dilmah Ceylon Tea Company PLC (Sri Lanka), Ippodo Tea Co. Ltd. (China), Tranquini (U.S), Chillbev (U.S), Som Sleep (U.S), Phi Drinks, Inc. (U.S), BevNet.com (U.S), are prominent players operating and dominating in the market.

Which geographical areas dominate the worldwide market for Hot Drinks?

Asia Pacific region are emerging as the top regional markets for Hot Drinks.