‘Coffee shops double across Bangladesh! Indulge in the burgeoning cafe culture that is fostering a love of great menu, business, and social connections.’
The café culture in Bangladesh has been experiencing a significant transformation over the past few years. With a growing middle class, increased urbanization, and changing lifestyle preferences, the café industry in Bangladesh is thriving and showing promising potential for future growth.
Global Coffee Market:
The worldwide coffee market is thriving, with hot and cold coffee beverages being produced from various coffee beans and served in diverse forms like espresso, cappuccino, and Latte. In 2024, the average volume consumed at home per individual in the coffee market is anticipated to reach 0.26 kilograms.
Two primary types of coffee beans are Arabica and Robusta. Coffee consumption isn’t just about an energy boost; it’s also associated with health benefits, such as reducing the risk of liver cancer and protecting against Parkinson’s disease. During the 2020/21 period, over 175 million coffee bags (each weighing 60 kilograms) were produced globally, marking the highest production numbers to date. A report from Statista Published that approximately half of the world’s coffee is produced in South America, with around 82 million bags filled in this region in 2022.
Coffee Market Revenue:
According to Mordor Intelligence, in 2024, the coffee market size is estimated at USD 132 billion and is projected to reach USD 166 billion by 2029, growing at a CAGR of 4.72% during the forecast period (2024-2029). The United States leads in coffee market revenue globally, generating approximately $85 billion. Brazil, ranking third, contributes $35 billion. Coffee imports are forecasted to reach around 136 million 60-kilogram bags in the 2022/23 period, while exports are expected to exceed 140 million.
Statista reported that in 2023, the United States was the top coffee importer, followed by Germany, Canada, and the Netherlands. Leading exporters included Brazil, Switzerland, and Germany.
Domestic Coffee Market:
Statista’s report on Bangladesh’s coffee market reported that the coffee market is poised for remarkable growth and substantial revenue generation in 2024. The at-home segment, encompassing revenue from supermarkets and convenience stores, is projected to reach a significant $568 million. However, the out-of-home segment, which includes revenue from restaurants and bars, is expected to be the true driving force, amounting to an impressive $1.2 billion. Collectively, the at-home and out-of-home segments are anticipated to generate a combined revenue of $1.8 billion in 2024. Notably, the at-home segment is forecasted to experience a robust annual growth rate of 8.83% (CAGR 2024-2028), indicating a strong upward trajectory. On a global scale, the United States emerges as the leader in at-home revenue, with a projected figure of $11 billion in 2024, underscoring the nation's dominance in this market segment. Furthermore, the average revenue per capita at home is expected to be a substantial $3.25 in the same year. In terms of volume, the at-home segment is projected to reach 45.9 million kg by 2024, while the out-of-home segment is anticipated to contribute 8.2 million kg, resulting in a combined volume of 54 million kg. Remarkably, the at-home segment is expected to exhibit a volume growth of 6.3% in 2025, further solidifying its position in the market.
Additionally, the average volume per person at home in the Coffee market is forecasted to be a significant 0.26kg in 2024. The Business Post mentioned, the nation's coffee demand has increased significantly. According to data furnished by the Department of Agricultural Extension (DAE), the yearly coffee output of Bangladesh stands at 56.25 metric tonnes, of which 95% of the domestic demand is met through imports. In recent years, there has been a significant surge in import volumes due to the upward trajectory of domestic demand.
The café market in Bangladesh comprises only a handful of players such as Nestle S.A., Food Empire Holdings Ltd. There are more or less 50 premium coffee cafés or coffee shops in Bangladesh which cater to a large market of almost 160 million consumers. Among these, 4 international chain coffee shops (Gloria Jean’s, North End, Coffee World, Barista) currently operate in Bangladesh.
There are several popular cafés in Bangladesh that have made a name for themselves. Some of the top coffee shops include:
Gloria Jean’s: An international chain that has made its mark in Bangladesh.
Coffee World: Another international chain contributing to the coffee culture in Bangladesh.
Barista: Known for its Italian-style coffee and cozy ambiance.
Butlers Chocolate Café: Located in Dhaka, this café is known for its delicious chocolates and cozy atmosphere.
Barcode Café: This café in Dhaka is popular for its relaxed ambiance and diverse menu.
Art Café: Known for its artistic décor and delicious food, Art Café is a favorite among the locals.
North End Coffee Roasters: Started in 2011, North End Coffee Roasters is a popular coffee shop in Dhaka, serving not only coffee but also various cakes, snacks, and other food items.
Crimson Cup: Columbus Coffee Shop offers a wide range of handcrafted hot, iced, and frozen espresso drinks, including espressos, café mochas, lattes, and more.
Instant Coffee in Bangladesh
Instant coffee is gaining popularity in Bangladesh. The convenience of instant coffee, coupled with its affordability, makes it a popular choice among many consumers. The market for instant coffee in Bangladesh is projected to grow annually by 8.62% (CAGR 2024-2028), resulting in a market volume of US$346 Million in 2024. The demand for instant coffee has led to a variety of brands being available in the market. Some of the popular brands include Nescafe and MacCoffee. These brands offer a range of instant coffee products, from classic blends to flavored coffees.
Roasted Coffee in Bangladesh
A paper on ‘Bangladesh: Roast Coffee Market Analysis, Size, Trends, Consumption, Opportunities, Challenges and Forecast’ published about the roasted coffee market in Bangladesh which is steadily gaining momentum, driven by shifting consumer preferences and the emergence of a vibrant café culture. Although the market remains relatively small, the demand for coffee has increased by an impressive 10% between 2012 and 2016, even amidst economic challenges. Currently, instant coffee dominates the Bangladeshi market, accounting for approximately 75% of coffee consumption. However, the annual demand for coffee in the country is substantial, reaching approximately 1,300 tonnes.
Looking ahead, the roasted coffee market in Bangladesh is poised for significant growth. In 2014, the market was valued at $129.30 million in retail prices. Forecasts indicate that by 2024, the coffee market in Bangladesh will reach $364.61 million, growing at an impressive compound annual growth rate (CAGR) of 10.82% per annum for the period 2019-2024. This projected growth underscores the increasing popularity of coffee among Bangladeshi consumers.
Cultivating Coffee Culture in Bandarban:
Nestled within Bangladesh's scenic hill tract region, the Bandarban district is a hidden gem adorned with pristine natural beauty. In this picturesque setting, the USAID SAPLING project has been instrumental in linking local producers to marketplaces, fostering a burgeoning coffee culture. For smallholder producers in Bandarban, coffee cultivation presents a golden opportunity to leverage their knowledge of cultivating crops on hillside terraces and integrate coffee plants into their land. While coffee was historically grown on a small scale in the region, it now offers a diversified income source for impoverished farmers.
Notably, USAID has played a pivotal role in building local farmers' production capacity, introducing depulping equipment, and implementing improved quality control measures. These efforts have significantly boosted prospects for higher sales volumes, positioning Bandarban as an emerging hub for coffee production.
Café Culture and Profitable Ventures:
In tandem with the growth of the coffee industry, café culture is gaining popularity in Bangladesh, particularly among the younger demographic. The BD Food Blog praised cafés that offer specialty coffee, pastries, and snacks has emerged as a lucrative business venture. Consumers are increasingly seeking a relaxed and cozy atmosphere to enjoy coffee and light bites, making cafés an attractive option in the market.
Challenges
Despite the promising growth, the café industry in Bangladesh faces several challenges. Cultural factors play a significant role, as the country has a strong tea-drinking tradition. However, with changing lifestyle preferences and increasing exposure to global trends, coffee consumption is on the rise. Another challenge is the competition from international café chains. However, local cafés can leverage their understanding of local tastes and preferences to offer a unique and personalized café experience.
Looking ahead, the cafe culture in Bangladesh is expected to continue flourishing. By embracing innovation, maintaining high standards, and contributing to the community, cafes have the potential to become even more prominent social hubs, enriching the lives of individuals and shaping the future of Bangladesh's vibrant social landscape
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