Single serve tea capsules could account for 10% of dry tea sales in 2015, predicts expert

By Elaine Watson contact

- Last updated on GMT

Tea pods could account for up to 10% of dry tea sales in 2015

Related tags: Coffee

One out of every 10 dollars (10%) spent on dry loose or bagged tea leaves in the US will be spent on single-serve capsules such as K-Cups in 2015, compared to just 2% in 2009, predicts one tea market expert.

Speaking to delegates at the World Tea Expo in Long Beach, California earlier this month, Dan Bolton, managing editor of STiR Tea & Coffee International, said that while Celestial Seasonings, Snapple and Bigelow branded tea capsules all posted double digit declines in the year to March 22, the overall market for single-serve tea capsules continues to grow.

While some commentators make slightly more conservative estimates of capsules' market share, many companies such as Starbucks do not break out capsule sales from loose leaf/bagged sales, while some data sets exclude online sales - which are strong for capsules, Bolton told FoodNavigator-USA.

 “I think​ [an estimate of] 10% of dry packaged sales in grocery and department stores is pretty close with most of the growth in value coming from Tazo, Yogi and Twinings.”

From a technical perspective, meanwhile, portion pack systems have advanced to deliver a better tasting product today than was possible a few years ago, while around 32 million US homes now have a single serve brewer of some description, said Bolton, who predicted firms will ship around 14 billion capsules in 2015 with around 71% filled with coffee, 20% filled with tea and the remaining 9% on other beverages (hot chocolate etc).

Euromonitor International senior beverages analyst Howard Telford also predicted continued growth in single serve tea capsules, which he said accounted for 6% of sales in 2014 vs 4.5% in 2012 and 2% in 2009.

He added: “The pods market has tripled in value in five years and next year we’ll also see lots of tea products in the Keurig Kold machines too.”

Check out our gallery of highlights from the World Tea Expo below:

TEA TIME! Highlights from the World Tea Expo 2015, from coffee leaf tea to ‘teablets’ 

Related topics: Markets

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