Functional Coffee Market by Product and Geography - Forecast and Analysis 2022-2026

The functional coffee market share is expected to increase by USD 2.36 billion from 2021 to 2026, and the market's growth momentum will accelerate at a CAGR of 5.85%.

This functional coffee market research report extensively covers functional coffee market segmentation by product (whole bean coffee, ground coffee, and RTD coffee) and geography (Europe, APAC, North America, South America, and Middle East and Africa). The functional coffee market report also offers information on several market vendors, including Baristas Coffee Co. Inc., Berner Food and Beverage, Bulletproof 360 Inc., Cothas Coffee Co., Farmer Bros Co., FM Cosmetics UK Ltd., Function Coffee Labs, Heine Brothers Coffee, Ingenuity Beverages LLC, Kitu Life Inc., Nathan Coffee Mart, Nestle SA, Peak State, Peets Coffee Inc., Royal Cup Inc., Sklew Biotech Ltd., Starbucks Coffee Company, Strauss Group Ltd., Tata Sons Pvt. Ltd., and Vardhman Foods and Beverages among others.

What will the Functional Coffee Market Size be During the Forecast Period?

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Functional Coffee Market: Key Drivers, Trends, and Challenges

The increasing consumption of coffee is notably driving the functional coffee market growth, although factors such as fluctuating prices of coffee beans may impede the market growth. Our research analysts have studied the historical data and deduced the key market drivers and the COVID-19 pandemic impact on the functional coffee industry. The holistic analysis of the drivers will help in deducing end goals and refining marketing strategies to gain a competitive edge.

Key Functional Coffee Market Driver

One of the key factors driving the global functional coffee market growth is the increasing consumption of coffee. Coffee is the second-most traded commodity in the world after oil. The cultivation of coffee is limited to 45 countries globally, with Brazil, Vietnam, Indonesia, and Colombia being the leading producers of coffee. In developed countries, such as the US, Canada, and Japan, coffee is the second-most preferred beverage after soft drinks. For instance, the demand for coffee pods has been increasing at a significant rate in the US owing to the ease of brewing and the convenience of brewing coffee at home. This has resulted in increased growth opportunities for the vendors in the market. This is also compelling vendors to focus on product diversification and introduce new flavors to increase their earnings. As a result, the market in focus is expected to grow during the forecast period.

Key Functional Coffee Market Trend

Another key factor driving the global functional coffee market growth is the increasing popularity of coffee among millennials. An improvement in economic conditions and an increase in job opportunities have made different types of coffee more affordable to young consumers. Millennials tend to spend more on premium beverage brands and are also keen to experiment with new types, brands, and flavors of beverages. Millennials also tend to socialize more, especially in coffee shops. This has led to a surge in the number of coffee shops, which has further strengthened the global functional coffee market. In addition, rising disposable incomes in emerging Asian, Eastern European, and Latin American countries and the growing coffee shop culture are the main factors boosting the popularity of different types of coffee, including functional coffee among Millennials. Such factors are projected to positively impact the market growth in the coming years.

Key Functional Coffee Market Challenge

One of the key challenges to the global functional coffee market growth is the fluctuating prices of coffee beans owing to factors such as disparity in the demand for and supply of coffee beans, a decline in the production of coffee beans, and rising labor costs. The increase in the price of raw materials not only increases the cost of the end product but also reduces manufacturers' profit margins. Furthermore, increasing competition in the market between the vendors is leading to low-profit margins for them despite the increasing cost of raw materials. In addition, suppliers of raw materials price their products at competitive and different prices. As a result, the fluctuating prices of coffee beans is expected to limit the growth of the global functional coffee market during the forecast period.

This functional coffee market analysis report also provides detailed information on other upcoming trends and challenges that will have a far-reaching effect on the market growth. The actionable insights on the trends and challenges will help companies evaluate and develop growth strategies for 2022-2026.

Parent Market Analysis

Technavio categorizes the global functional coffee as a part of the global packaged foods and meats market. Our research report has extensively covered external factors influencing the parent market growth potential in the coming years, which will determine the levels of growth of the functional coffee market during the forecast period.

Who are the Major Functional Coffee Market Vendors?

The report analyzes the market's competitive landscape and offers information on several market vendors, including:

 

• Baristas Coffee Co. Inc.
• Berner Food and Beverage
• Bulletproof 360 Inc.
• Cothas Coffee Co.
• Farmer Bros Co.
• FM Cosmetics UK Ltd.
• Function Coffee Labs
• Heine Brothers Coffee
• Ingenuity Beverages LLC
• Kitu Life Inc.
• Nathan Coffee Mart
• Nestle SA
• Peak State
• Peets Coffee Inc.
• Royal Cup Inc.
• Sklew Biotech Ltd.
• Starbucks Coffee Company
• Strauss Group Ltd.
• Tata Sons Pvt. Ltd.
• Vardhman Foods and Beverages

 

This statistical study of the functional coffee market encompasses successful business strategies deployed by the key vendors. The functional coffee market is fragmented and the vendors are deploying growth strategies such as investment in building distribution networks and product portfolios to differentiate themselves and to compete in the market.

Product Insights and News

• Nestle SA - It is a public company headquartered in Switzerland. It is a global company generating USD 95,764.8 million in revenues and has around 273,000 employees. Its revenue from the global functional coffee market contributes to its overall revenues along with its other offerings, but it is not a key revenue stream for the company.
• The company offers functional coffee such as breakfast blend, veranda blend, and many more.

To make the most of the opportunities and recover from post COVID-19 impact, market vendors should focus more on the growth prospects in the fast-growing segments, while maintaining their positions in the slow-growing segments.

The functional coffee market forecast report offers in-depth insights into key vendor profiles. The profiles include information on the production, sustainability, and prospects of the leading companies.

Functional Coffee Market Value Chain Analysis

Our report provides extensive information on the value chain analysis for the functional coffee market, which vendors can leverage to gain a competitive advantage during the forecast period. The end-to-end understanding of the value chain is essential in profit margin optimization and evaluation of business strategies. The data available in our value chain analysis segment can help vendors drive costs and enhance customer services during the forecast period.

Which are the Key Regions for Functional Coffee Market?

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33% of the market's growth will originate from APAC during the forecast period. Indonesia is the key market for functional coffee in APAC. Market growth in this region will be faster than the growth of the market in other regions.

Europe is another potential market for functional coffee. The increase in demand for healthy and nutritious food will facilitate the functional coffee market growth in Europe over the forecast period. This market research report entails detailed information on the competitive intelligence, marketing gaps, and regional opportunities in store for vendors, which will assist in creating efficient business plans.

COVID Impact and Recovery Analysis

In 2020, with the outbreak COVID-19 pandemic, lockdown restrictions were imposed in Europe to stop the spread of the disease. Italy, Spain, Germany, France, Switzerland, the UK, the Netherlands, Austria, Belgium, Norway, Portugal, and Sweden were some of the countries that were badly affected by the COVID-19 pandemic. With the restrictions being lifted, coffee shops, malls, and stores reopened across many European countries, which will have a positive impact on the market. Furthermore, the pandemic has increased the interest of consumers in supplements and the consumption of more functional foods/beverages. Factors such as these will fuel the demand for functional coffee in Europe, and thus we can expect to see positive market growth during the forecast period.

What are the Revenue-generating Product Segments in the Functional Coffee Market?

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The functional coffee market share growth by the whole bean coffee segment will be significant during the forecast period. When compared to whole beans, ground coffee loses its freshness faster because the surface area exposed to the air increases after grinding. Coffee beans are both rich in antioxidants and full of nuanced flavors. However, like fruits, coffee is vulnerable to natural chemical processes that can diminish its inherent positive health benefits, flavor, and mouthfeel. Keeping coffee beans whole helps to slow down these processes and helps in keeping them fresher, healthier, and tastier for a much longer period of time. The growth of the segment is attributed to the high demand for whole bean coffee as it is ground just before brewing, and so it tends to taste more fresh and flavorful than pre-ground coffee beans.

This report provides an accurate prediction of the contribution of all the segments to the growth of the functional coffee market size and actionable market insights on post COVID-19 impact on each segment.

You may be interested in:

Instant Coffee market - The market share is expected to increase by USD 8.88 billion from 2019 to 2024, and the market's growth momentum will accelerate at a CAGR of 5.01%.

Raw Coffee Beans market - The market share is expected to increase by 73.44 metric tonnes from 2021 to 2026, and the market's growth momentum will accelerate at a CAGR of 4.08%.

Speciality Coffee Shops market - The market share is expected to increase by USD 68.59 billion from 2021 to 2026, and the market's growth momentum will accelerate at a CAGR of 13.02%.

Europe Functional Beverage market - The market share is expected to increase to USD 13.95 billion from 2021 to 2026, and the market's growth momentum will accelerate at a CAGR of 8.25%.

Functional Coffee Market Scope
Report Coverage	Details
Page number	120
Base year	2021
Forecast period	2022-2026
Growth momentum & CAGR	Accelerate at a CAGR of 5.85%
Market growth 2022-2026	$ 2.36 billion
Market structure	Fragmented
YoY growth (%)	5.33
Regional analysis	Europe, APAC, North America, South America, and Middle East and Africa
Performing market contribution	APAC at 33%
Key consumer countries	US, Indonesia, Germany, France, and Italy
Competitive landscape	Leading companies, Competitive strategies, Consumer engagement scope
Key companies profiled	Baristas Coffee Co. Inc., Berner Food and Beverage, Bulletproof 360 Inc., Cothas Coffee Co., Farmer Bros Co., FM Cosmetics UK Ltd., Function Coffee Labs, Heine Brothers Coffee, Ingenuity Beverages LLC, Kitu Life Inc., Nathan Coffee Mart, Nestle SA, Peak State, Peets Coffee Inc., Royal Cup Inc., Sklew Biotech Ltd., Starbucks Coffee Company, Strauss Group Ltd., Tata Sons Pvt. Ltd., and Vardhman Foods and Beverages
Market dynamics	Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period
Customization purview	If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized.

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What are the Key Data Covered in this Functional Coffee Market Report?

• CAGR of the market during the forecast period 2022-2026
• Detailed information on factors that will drive functional coffee market growth during the next five years
• Precise estimation of the functional coffee market size and its contribution to the parent market
• Accurate predictions on upcoming trends and changes in consumer behavior
• The growth of the functional coffee industry across Europe, APAC, North America, South America, and Middle East and Africa
• A thorough analysis of the market's competitive landscape and detailed information on vendors
• Comprehensive details of factors that will challenge the growth of functional coffee market vendors

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