China’s increasingly urbanised and affluent population is drinking more coffee than ever before. From 2018–19 to 2020–21, coffee consumption in China increased by 140% (Source: ).
Coffee culture suits the increasingly fast-paced city lifestyle that many in China aspire to.
Implications for Australian exporters
Chinese coffee imports increased 144% in 2021 to A$1.12 billion. Malaysia, Vietnam, Japan, Guatemala and Colombia were the top five suppliers. They accounted for 57% of total Chinese coffee imports (Source: ).
Despite having a relatively small market share for roasted coffee, Australian grown and roasted coffee is renowned for quality. It has a loyal and niche clientele in China. The flat white, or Ao Bai (Australian White), is becoming increasingly popular in Chinese coffee shops.
Australian exporters seeking to enter the Chinese coffee market should read Austrade’s China market profile. You can also refer to the for and coffee beans to China.
Figure 1: Chinese coffee imports 2018 to 2021
Source:
Coffee consumption in China
Tea has traditionally dominated hot-drink consumption in China. The entry of large coffee retailers in the late 1990s coincided with rapid urbanisation and large demographic shifts. In 1980, around 80% of China’s population lived in rural areas, where coffee consumption was rare. Now, almost two-thirds of China’s population live in urban areas, with much broader food and beverage options (Source: ).
China is now one of the world’s fastest growing coffee markets. As of April 2022, China has approximately 110,000 coffee shops (Source: ). In Chengdu, China’s third largest coffee-consuming city, one coffee shop opened per day in 2020 (Source: ). China is home to more than 5,400 Starbucks stores. Local competitors, such as Luckin Coffee, are also expanding their footprint.
Coffee is still considered a luxury item. Coffee prices are high compared to other food and beverage products. For example, in 2021, the average cost of a latte was A$4.05 (Source: ), while the average cost of milk tea or fruit juice was A$1.50 per cup (Source: ).
Coffee consumers in China:
- are between 20 and 40 years old
- are white collar workers in “first tier” cities (such as Beijing, Shanghai, Guangzhou and Shenzhen)
- have a bachelor’s degree or above
- have a high income (Source: ).
Coffee production in China
China is a mid-sized global coffee producer. Most production is consumed domestically. Chinese coffee consumption is increasing at a faster rate than domestic production. This has created more opportunities for coffee exporters around the world.
The USDA expects China’s coffee production to decline to 1.75 million 60kg bags in 2021–22. Chinese coffee producers are finding coffee production less profitable and are switching to other crops. China’s imports of coffee are forecast to reach 4 million 60kg bags in 2021–22 (Source: ).
Figure 2: Chinese imports, production, and consumption of coffee (measured in million 60kg bags of coffee)
Source:
Table 1: Chinese coffee import suppliers
Country | 2018 | 2019 | 2020 | 2021 | Average (2018-2021) |
Malaysia | $130m | $156m | $180m | $188m | $164m |
Vietnam | $174m | $122m | $138m | $167m | $150m |
Japan | $17m | $30m | $68m | $106m | $55m |
Guatemala | $24m | $17m | $33m | $99m | $43m |
Colombia | $37m | $34m | $44m | $87m | $50m |
Brazil | $30m | $36m | $40m | $83m | $47m |
Ethiopia | $21m | $28m | $31m | $81m | $40m |
Italy | $36m | $42m | $49m | $49m | $44m |
Switzerland | $14m | $19m | $33m | $33m | $25m |
Indonesia | $27m | $26m | $29m | $30m | $28m |
Australia (13th) | $3m | $973k | $2m | $16m | $6m |
Other | $134m | $136m | $147m | $187m | $139m |
(Source: )
Resources
The has import requirements for and coffee beans to China.
Austrade has more information about the Chinese market.
The USDA has recently published an extensive report on the .
