South Korea’s Instant Coffee Market Falls 9.4% in 2015

In 2015, something shifted in South Korea’s coffee habits. While overall coffee consumption kept rising, one long-dominant product saw steady decline: instant coffee. Once a staple in every Korean household, it’s now losing ground to cafés, fresh brews, and newer alternatives. This isn’t just a blip—it’s part of a broader change in how Koreans take their coffee.

Yes, South Korea’s instant coffee market dropped 9.4% in 2015 compared to the previous year, with retail sales falling to 1.05 trillion KRW (US$8.956 billion). That’s a 14.7% drop since 2012, showing a sustained downward trend as preferences evolve.

What the Numbers Show

According to data released by South Korea’s Ministry for Agriculture, Food and Rural Affairs (MAFRA), the country’s instant coffee sector saw its total retail value fall to 1.05 trillion Korean won in 2015—a 9.4% year-on-year decrease. The decline isn’t new: back in 2012, the market was already down 14.7% from its peak. MAFRA also reported that September 2015 sales totaled 751.3 billion KRW, down 5.7% from the same month the previous year.

Who Controls the Instant Coffee Market?

The instant coffee market in South Korea remains highly concentrated. Over 80% of the market share is held by domestic giant Dongsuh Foods. Following behind are Namyang Dairy Products with 12%, and Nestlé Korea with 4.2%. These three companies dominate the shrinking segment, but even their dominance can’t reverse the downward trend.

Why Consumers Are Moving On

Younger South Koreans are driving the shift away from instant coffee. Across the country, specialty coffee shops have proliferated, offering freshly ground espresso-based drinks and curated brews that appeal to a more quality-conscious, experience-driven demographic. In addition to cafés, other coffee products such as ready-to-drink (RTD) coffee and coffee capsules have also taken a slice of the market that instant used to command.

Health concerns have also played a role. Instant coffee has long been criticised for its high sugar content and the use of hydrogenated creamers. In response, manufacturers have begun reformulating products—reducing sugar and seeking healthier fat substitutes—to try and win back customers. But so far, those efforts haven’t reversed the decline.

How Much Coffee Are Koreans Really Drinking?

Despite the drop in instant coffee, overall coffee consumption in South Korea is rising. According to the Korea Customs and Trade Development Institute, the average Korean adult now consumes 341 cups of coffee per year—up 23.1% from 2009. That growth is being fuelled not by instant, but by freshly brewed options and on-the-go RTD products.

Frequently Asked Questions

How much did South Korea’s instant coffee market shrink in 2015?

South Korea’s instant coffee market shrank by 9.4% in 2015 compared to the previous year, with total retail sales falling to 1.05 trillion KRW (US$8.956 billion).

What was the market value of instant coffee in South Korea in 2015?

The total retail value of South Korea’s instant coffee market in 2015 was 1.05 trillion Korean won (approximately US$8.956 billion).

Which companies dominate the South Korean instant coffee market?

Dongsuh Foods holds over 80% of the South Korean instant coffee market, followed by Namyang Dairy Products with 12%, and Nestlé Korea with 4.2%.

Why are South Koreans drinking less instant coffee?

South Koreans, especially younger consumers, are shifting toward freshly brewed coffee from cafés, as well as RTD and capsule options. Health concerns over sugar and creamers in instant coffee also contribute to the decline.

Has instant coffee consumption fallen in South Korea before 2015?

Yes, according to MAFRA, South Korea’s instant coffee market had already declined by 14.7% by 2012 compared to earlier peaks, with the drop continuing into 2015.

How many cups of coffee does the average South Korean drink per year?

The average South Korean adult consumes 341 cups of coffee per year, a 23.1% increase from 2009, driven by growing café culture and alternative coffee formats.

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