Singapore is a unique coffee market given that it is a major coffee bean producer and exporter, a global coffee trading hub for the Southeast Asian region, and home to a distinctive café culture. The coffee market growth has gained pace, spurred by the proliferation of coffee roasters and cafés over the last decade and the surge in at-home coffee consumption during the pandemic. With all remaining COVID-19 restrictions lifted by early 2023, the country is witnessing a rebound in on-premise coffee sales. As a result, Singapore’s coffee sales are set to increase steadily by 3.2% value compound annual growth rate (CAGR) over 2022–27, according to GlobalData, a leading data and analytics company.

Tim Hill, key account director, GlobalData Singapore, comments, “While Singapore is a tea-drinking nation, coffee consumption is also on the rise. The country has a coffee heritage that dates back to the arrival of Portuguese settlers in the 1850s. During British colonial rule, coffee plantations were introduced in Singapore. The diverse ethnicities that immigrated to Singapore brought their indigenous coffee cultures. These settlers set up traditional coffee houses called ‘kopitiams’ where they socialized over a cup of ‘kopi’, a heavy-bodied butter and sugar-roasted coffee.

“Today, Singaporeans get their daily caffeine fix from kopitiams, sprawling open-air food stalls known as hawkers centers, street carts, or the host of new-age cafés and coffee roasters that have opened shop in the last decade. Besides kopi and Western-style lattes, flat whites and cold brew coffees have also gained popularity. Coffee has become somewhat of a staple for Singaporeans, with the per capita coffee consumption at 122.7 liters in 2022 for a city-state with a population of just 5.6 million. Yet, the market continues to expand, with sales rising year after year.”

Bobby Verghese, consumer analyst, GlobalData, notes, “The COVID-19 lockdown and intermittent closures of hotel, restaurant, and café (HoReCa) outlets boosted at-home consumption of coffee. Tapping this trend, domestic microbrewery Wake The Crew ramped up online sales of ready-to-drink (RTD) cold-brew coffee and coffee concentrates, and local tech startup Flash Coffee rapidly expanded its chain of app-based pick-up and delivery cafés during the pandemic. The lifting of all remaining COVID-19 restrictions by early 2023 has paved the way for residents and tourists to return to cafés and restaurants, thereby fueling the revival of on-premise sales.”

Hill adds, “Instant coffee dominates the Singapore market, addressing the consumer need for convenience and affordability. The trend is poised to prevail in the immediate future as consumers revert to their hectic pre-pandemic lifestyles and curtail their spending amid spiraling inflation. However, specialty coffee roasters and cafés are motivating consumers to trade up for premium coffee. Moreover, more young urbanites are purchasing small-scale coffee-bean roasters and coffee-making machines, and coffee pods and capsules to recreate barista-quality coffee at home. The government’s efforts to promote the specialty coffee trade are also bolstering the trend by making premium coffee more accessible to local coffee roasters and café operators.”

Verghese concludes, “Unsurprisingly, more multinational companies are eyeing the potent Singapore coffee market. For instance, the Japanese beverages giant, Suntory Group, launched its popular Suntory Boss RTD coffee drinks brand through 7-Eleven stores in March 2023. Additionally, the Chinese café heavyweight, Luckin Coffee, flagged off its first international venture by opening two pilot outlets in Singapore in April 2023. The iconic Canadian chain, Tim Hortons, has also announced similar expansion plans.”