[AJU NEWS DB]
South Korea's coffee imports are set to hit a new record in 2015, helped by growing demand from consumers, despite a prolonged economic slump which has withered overall private spending.
The domestic coffee market has grown by nine percent annually, with its total value now estimated at 5.4 trillion won, since US coffeehouse giant Starbucks opened its first shop in Seoul in 1999.
Official data showed South Korea's coffee imports in 2014 soared 30 percent on-year to a record high of 133,700 tons. This year's imports are forecast to reach 140,000 tons.
Growth has been driven by the popularity of franchise cafes which meet various demands of consumers with multiple products and freshly brewed coffee using espresso machines.
The market is now almost saturated with nearly 50,000 coffee shops nationwide, but industry watchers say there is room for further growth as many still drink instant coffee mix.
"South Korea's coffee market is now in a transition period," Lee Young-Min, a director of the Korea Coffee Association, said on his blog, adding competition offers consumers more choices.
"The taste of South Korean coffee drinkers is shifting from instant to brew and specialty," he said.
In recent years, a prolonged economic slump has changed market trends, compelling more people to find cheaper products at home-grown chains like Ediya Coffee and Paik's Coffee.
Ediya, the country's biggest chain with more than 1,700 retail stores, has written a remarkable success story in the competitive industry dominated by Starbucks and other large stores.
But Starbucks is still the most-beloved chain with 820 shops in South Korea, according to a Realmeter survey published in October, followed by Ediya, Caffe Bene and Angel-in-us.
Ediya has focused on small shops offering premium coffee at lower prices, with its Americano priced at 2,800 won.
Paik's Coffee, a chain launched by famous chef Paik Jong-Won, has followed suit with the success of its 1,500 won Americano.
This year convenience stores have stolen a significant stake with 1,000 won Americano, while large franchise operators rectified business portfolios to protect their turf.
Starbucks are now selling premium drinks with a maximum price tag of 12,000 won a cup, while Caffe Bene stepped up an ambitious push to spread low-priced but high-quality coffee across Asia.
Charles Lim
reporter
Park Sae-jin
swatchsjp@ajunews.com
