Global Coffee Pods and Capsules Market to Grow at a CAGR of 7.2% During the Forecast Period of 2024-2032, Driven by Convenience and Ease of Brewing Coffee

The global coffee pods and capsules market is likely to be driven by rising incomes and consumers’ demand for rich taste, convenience and ease of brewing coffee. High demand for sustainable solutions is expected to be a key market driver. North America and Europe are likely to be key markets. The Asia Pacific is also expected to be a significant market, with China, Japan and Vietnam as key drivers.

Pods and capsules made from recyclable and environmentally-friendly materials are expected to witness greater demand. The market for coffee capsules has high potential, and the demand and insistence to offer more sustainable solutions are also increasing. For example, in 2020, Nespresso announced the launch of the first coffee capsules manufactured employing 80% recycled aluminium. The initiative was part of the company’s journey towards circularity, minimizing waste and maximizing reuse of product materials.

In 2022, TÜV Austria certified Constantia Flexibles EcoPressoLid, a lidding material for coffee capsules. The new capsule lidding featured high barrier to oxygen, high sealability for a compostable coffee capsule, suitability for conventional capsule-closing machines, and remarkable coffee brewing performance.

In 2020, Nespresso committed that every cup of Nespresso coffee, both for at-home and for professional customers, would be carbon neutral by 2022. The ambition built on over 10 years of work during which Nespresso decreased its carbon emissions and compensated the rest through agroforestry. Nespresso had been carbon neutral across business operations since 2017; the company now committed to achieving full carbon neutrality across its supply chain and product life cycle. Such efforts are expected to contribute to growth of global coffee pods and capsules market.

In 2020, Keurig Dr Pepper announced that it had successfully achieved one of its longstanding sustainability commitments – all of the company produced K-Cup® pods were now recyclable. The effort entailed converting over 100 manufacturing lines to manufacture the pods now created from polypropylene #5 plastic. The new packaging for the recyclable K-Cup pods also featured a green recyclable flag with the industry-respected How2Recycle® label that clearly communicated recycling instructions to consumers. In 2020, Keurig Dr Pepper, Inc. (KDP) announced that it has entered into a long-term, strategic agreement with Nestlé USA (Nestlé) to manufacture and distribute Starbucks branded packaged coffee in K-Cup® pods in the U.S. and Canada.

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In 2020, Kraft Heinz released Maxwell House compostable coffee pods in Canada. the launch of Maxwell House 100% compostable coffee pods offered an alternative to the popular single-serve pods. Manufactured wholly from plant-based materials, all pod components and its inner bag were 100% compostable, further, the outer carton was 100% recyclable, leaving zero waste for the consumer.

In 2020, Nestlé and Jacobs Douwe Egberts UK, came together to form Podback: a first of its kind recycling programme for coffee pods. Podback was the UK’s first cross-industry collaboration in the coffee sector, offering several ways for coffee pods and capsules to be recycled.

Companies are also looking to invest in innovative solutions. For example, in 2021, Cometeer, a maker of 'Flash frozen’ coffee capsule, received $30m Series B funding. The investment brought the US company's total funding to $100m, which it would use to enhance manufacturing capacity at its 70,000sq ft headquarters, introduce more roasting partners, and ‘invest in innovation'. Cometeer’s novel system involved flash freezing extracted coffee in liquid nitrogen before transfer of the puck to aluminium capsules. The capsules would be directly delivered to customers and could be stored in home freezers for up to 18 months. Brewing involved immersing the coffee puck in hot water to prepare hot or cold beverages. Innovative solutions in the domain are expected to boost the global coffee pods and capsules market.

Key Findings of the Report:

• The global coffee pods and capsules market is likely to be driven by consumers’ preference for rich coffee taste and flavour, rising incomes and convenient ways to brew coffee.

• Sustainable solutions are expected to be a key driver.

• North America, Europe and Asia are projected to be significant markets.

Market Analysis by Type, Distribution Channel and Region:

• By type, the market is segmented into capsules and pods.

• By distribution channel, the market is divided into off-trade and on-trade.

• By region, the market is classified into North America, Europe, Asia Pacific, Latin America, and Middle East and Africa.

The major players in the global coffee pods and capsules market are Nestlé S.A., Luigi Lavazza S.p.A., illycaffè S.p.A., Rave Coffee, The Kraft Heinz Company, Jacobs Douwe Egberts Pro, Caffitaly System S.p.A., Toro Caffè, Dualit Limited, and The J.M. Smucker Company, among others. The comprehensive report by EMR looks into the market share, capacity, and latest developments like mergers and acquisitions, plant turnarounds, and capacity expansions of the major players.

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