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Saudi Arabia Coffee Market size was valued at US$ 4.09 Bn. in 2023. Coffee will encourage a great deal of transformation in Beverage Sector in Saudi Arabia.

Market Estimation & Definition

The Saudi Arabia coffee market encompasses the entire spectrum of coffee consumption within the country, including retail coffee sales, café and restaurant channels, instant coffee, specialty coffee, and premium coffee products. It reflects the evolving lifestyle and cultural shifts toward coffee appreciation, from traditional Arabic coffee to international and specialty brews.

As per the Stellar MR report, the market was valued at approximately SAR X billion in 2023, with an anticipated compound annual growth rate (CAGR) of X% over the forecast period of 2024–2028. The growth is fueled by expanding coffeehouse chains, rising disposable incomes, and an increasing inclination toward premium and specialty coffee.

Market estimation factors include consumer spending, import/export data, retail and horeca sales, and the proliferation of coffee outlets across urban centers. The segmentation covers product types, distribution channels, and consumer demographics, offering a comprehensive view of the Saudi coffee landscape.

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Market Growth Drivers & Opportunities

Driving Factors:

• Cultural Shift & Coffeehouse Culture: Traditionally known for Arabic coffee (Gahwa), Saudi Arabia is experiencing a modern coffee renaissance, with a surge in international and specialty coffee cafes, especially in urban hubs like Riyadh and Jeddah.

• Rising Disposable Income & Urbanization: Increasing affluence and urban lifestyle modernization foster demand for premium coffee experiences and high-quality products.

• Young & Trend-Conscious Demographic: A large proportion of the population is young, tech-savvy, and receptive to global coffee trends, fueling growth in café culture and specialty offerings.

• International Coffee Brands & Local Artisans: Expansion of global chains (Starbucks, Dunkin’ Donuts) alongside local cafes introducing unique blends and specialty brews broaden the market base.

• Government Vision 2030 & Tourism Initiatives: The Kingdom’s strategic initiatives to boost tourism and diversify the economy include promoting lifestyle and hospitality sectors, including coffee culture.

Emerging Opportunities:

• Specialty & Premium Coffee Segment: Growing consumer appreciation for high-quality, ethically sourced, and single-origin coffees.

• Coffee Subscription & E-commerce: Digital channels for purchasing coffee beans, brewing equipment, and subscriptions are gaining traction, especially among younger consumers.

• Sustainability & Ethical Sourcing: Increasing demand for environmentally friendly, Fair Trade, and organic coffee options.

• Localization & Cultural Fusion: Integrating traditional Arabic coffee elements with modern brewing techniques to create unique product offerings.

• Expansion in Tier-2 & Tier-3 Cities: Untapped markets beyond major cities offer growth potential for new cafes and retail outlets.

Segmentation Analysis

The Stellar MR report segments the Saudi coffee market based on product type, distribution channel, and consumer preferences:

• By Product Type:

  • Instant Coffee: Significant due to convenience and affordability, particularly in retail outlets.
  • Ground Coffee & Whole Beans: Increasing demand driven by home brewing enthusiasts.
  • Coffee Capsules & Pods: Rapidly expanding segment, favored for ease of use and variety.
  • Specialty & Premium Coffee: Gaining popularity among affluent consumers seeking unique flavors and quality.

• By Distribution Channel:

  • Cafés & Coffee Shops: Leading channel, with international chains and local specialty cafes proliferating.
  • Supermarkets & Hypermarkets: Major retail points for packaged coffee products.
  • Online & E-commerce Platforms: Growing importance, especially for premium and specialty products.
  • Convenience Stores & Hypermarkets: Catering to on-the-go consumers.

• By Consumer Segment:

  • Young Professionals & Millennials: The primary drivers of café culture and premium coffee consumption.
  • Tourists & Visitors: Contributing to demand, especially in hospitality and retail outlets.
  • Traditional Consumers: Still prefer Arabic coffee but increasingly adopting modern brewing methods.

This segmentation underscores a dynamic market adapting to diverse consumer tastes and preferences.

For additional insights into this study, please refer to: https://www.stellarmr.com/report/Saudi-Arabia-Coffee-Market/78 

Country-Level Analysis

Saudi Arabia:

The Saudi coffee market is characterized by a blend of traditional and contemporary influences. Historically rooted in Arabic coffee (Gahwa), the culture is now experiencing a modern transformation fueled by globalization, technological advancements, and tourism development.

Key Highlights:

• Growing Café Culture: The number of coffee shops and international chains is rising rapidly, with urban centers leading the way.
• Premium & Specialty Coffee: Consumers are increasingly seeking quality, ethically sourced, and artisanal coffee options.
• E-commerce & Home Brewing: Digital sales channels and home brewing equipment are witnessing significant growth, driven by tech-savvy youth.
• Tourism & Hospitality Growth: As the Kingdom promotes tourism, the demand for diverse coffee experiences expands.

Comparative Insights:

Compared to neighboring Gulf countries, Saudi Arabia's market shows a unique blend of traditional Arabic coffee appreciation and a burgeoning global coffee culture, positioning it as a key growth market in the Middle East.

Market Dynamics & Consumer Behavior

Saudi consumers are becoming more discerning, valuing quality, sustainability, and experience. Coffee consumption is increasingly social and lifestyle-oriented, with café visits serving as social hubs and workspaces. The influx of international brands has elevated consumer expectations, while local artisans are innovating with fusion flavors and culturally infused offerings.

Key behavioral trends include:

• Preference for specialty, organic, and ethically sourced coffee.
• Growing demand for convenient, on-the-go coffee options.
• Increased online engagement for product discovery and purchasing.
• Adoption of new brewing technologies and home coffee setups.

Conclusion

The Saudi Arabia coffee market is on an upward trajectory, driven by cultural shifts, demographic trends, and strategic national initiatives. The transition from traditional Arabic coffee to a diverse, modern coffee culture offers extensive opportunities for local and international brands alike.

As consumers increasingly prioritize quality, sustainability, and experiences, companies that innovate with premium offerings, embrace digital channels, and align with Saudi Arabia’s Vision 2030 goals will be well-positioned for success. The market’s evolving landscape presents a compelling opportunity for growth, innovation, and cultural fusion.

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