Hot drinks market of Malaysia to reach US$2bn by 2025, says GlobalData

The Malaysian hot drinks market is projected to grow from RM6.3bn (US$1.5bn) in 2020 to RM8bn (US$2bn) by 2025 at a compound annual growth rate (CAGR) of 4.9% over the five-year period, says GlobalData, a leading data and analytics company.

GlobalData’s report, ‘Malaysia Hot Drinks – Market Assessment and Forecasts to 2025’ reveals that the market is majorly driven by growth in the hot coffee category, which is forecast to register the fastest value CAGR of 6.2% during 2020–2025. The category is followed by hot tea, which is expected to record a CAGR of 4% during the same period.

Vishakha Rastogi, Consumer Analyst at GlobalData, says: “The Malaysian hot drinks market is dominated by the instant coffee which has seen growing popularity amongst young working population. It is followed by the green tea segment due to its associated health benefits. Rising health awareness amongst consumers because of COVID-19 has also been a contributing factor.”

‘Convenience stores’ was the leading distribution channel in the Malaysian hot drinks market in 2020, followed by ‘hypermarkets & supermarkets’ and food & drinks specialists.

Per capita expenditure (PCE) of hot drinks in Malaysia increased from US$42.3 in 2015 to US$45.5 in 2020, which was higher than both the global level (US$31.8) and the regional level (US$20.4). Furthermore, per capita expenditure of hot drinks in Malaysia is expected to increase and reach US$56.3 by 2025.

​Nestle, BOH Plantations SDN BHD and Unilever were the top three companies in the Malaysian hot drinks market by value in 2020, while Boh and Lipton were the leading brands.

Rastogi concludes: “The growth of hot drinks in the country will depend on the flavor innovation by the companies and how “healthy” it is as they look for healthier alternatives in wake of COVID-19.”

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