South Korea's coffee industry has shown significant growth, expanding to a market size of 3.7 trillion won. The rapid transformation of the market is attributed to consumers' evolving preferences and a focus on value.
According to an analysis of coffee industry and consumption trends released on August 11 by the Ministry of Agriculture, Food and Rural Affairs and the Korea Rural Economic Institute, the total market size of the domestic coffee industry is projected to reach 3.7359 trillion won in 2024, marking a 35.6% increase compared to 2018. The average annual growth rate over the past six years has been 5.2%.
The landscape of related industries is also changing. As of 2023, the number of coffee processing businesses has decreased by 8.0% from the previous year, totaling 1,660, marking the first decline. In contrast, the number of coffee shops, which directly engage with consumers, has increased by 5.7% to 106,452.
The share of coffee shops within the overall food service industry has also risen, increasing from 9.3% in 2018 to 13.4% in 2023, indicating that one in seven food service establishments is now a coffee shop.
The growth of roasted coffee has outpaced that of instant coffee. The market for roasted coffee is expected to reach 1.3225 trillion won in 2024, with an average annual growth rate of 15.8%, while instant coffee has seen a slight decline of 0.5% annually. However, the roasted coffee market is experiencing a polarization trend, with both low-cost coffee shops and bulk product markets growing simultaneously.
Alongside industry growth, exports are also on the rise. Coffee product exports are projected to reach $229.6 million in 2024, a 4.6% increase from the previous year. Instant coffee constitutes the majority of exports, but there has also been a rise in the export of roasted beans combined with roasting technology. By country, Israel (18.1%) is identified as the largest export market, followed by China (15.4%) and Australia (7.1%).
Jung Kyung-seok, Director of Food Industry Policy at the Ministry of Agriculture, Food and Rural Affairs, stated, "The domestic coffee industry has developed a dynamic ecosystem characterized by the simultaneous growth of premium and value-oriented markets based on segmented consumer preferences. We will implement various policies to support the integration of food tech and elevate coffee as a key export item in K-Food+."
* This article has been translated by AI.
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