EXCLUSIVE: Coffee Culture Booming In Middle East As Tradition Blends With Modern Ways

The Middle East is literally where modern coffee consumption as we know it was born sometime around the 14th Century after coffee was initially discovered in Ethiopia, yet the region remains one of the least known coffee markets in the world — and this is even though the Middle East and Gulf region has a market of between 4.5 and 5 million 60-kilogram bags. As the main hub for the region, Dubai has long been the trend setter for the region and at the center of any new development. And from Dubai across the Middle East, coffee culture is booming like never before with growth in double digits expected for years to come. Don’t miss this exclusive insight into the world’s oldest coffee market by SpillingTheBeans’ author and owner Maja Wallengren in a special Cover Story for the Tea & Coffee Trade Journal’s November 2014 edition.

BY MAJA WALLENGREN

Coffee growth is everywhere in Dubai and in the Middle East. From the visible numbers of more coffee shops on the streets to the sheer amount of different roast and ground coffees being offered in super markets, there is no denying the boom in coffee culture.

From the onset of the latest wave of growth the number of modern coffee shops owed by chains such as Starbucks and Costa Coffee rose to 160 in 2012 from 118 in 2008 in Dubai alone, according to data from the Dubai Chamber of Commerce and Industry. The number of coffee trading companies meanwhile rose to 112 from 99 in the five year period.

The Seattle-based Starbucks Coffee Co has since it first entered the Middle East in 1999 through a licensing agreement with the Kuwait family business the Alshaya Group expanded its business to over 230 stores today across the Middle East markets of Bahrain, Egypt, Jordan, Kuwait, Lebanon, Oman, Qatar, Saudi Arabia and the UAE, according to company information.

And by the end of 2014 the Dubai International Coffee & Tea Festival reported the United Arab Emirates is home to over 4,000 coffee shops and tea houses. This figure includes everything from modern coffee shops to traditional street vendors or coffee sold by Bedouins in old-fashioned tents stuffed with oriental rugs and coffee artefacts taking visitors hundreds of years back in history.

“The world market is growing at about 2.5 percent and coffee continues to be one of the strongest performing commodities. But the Middle East as part of the emerging markets is growing at between 4 and 10 percent and Dubai in particular is growing at between 20 and 30 percent because of the expansion in the number of cafes,” Khalid Khalid Al Mulla, a partner in the UAE company Easternmen & Co, told Tea & Coffee Trade Journal during a visit to Dubai earlier this year. Easternmen is one of the biggest roasters in the Middle East and the company also recently opened the first Coffee Museum in the Middle East, where tourists and coffee lovers alike can learn about the history of coffee from seed to cup.

Figures are hard to come by. In the last 4 years Turkey has doubled green coffee imports to 500,000 bags in the 2013-14 crop cycle from just 275,000 bags in the 2009-10 cycle, according to the USDA. It estimated total consumption in the four core Middle Eastern countries of Iran, Jordan, Yemen and Turkey at 1.315 million bags. The data is still so new that the USDA offers no comparative figures.

Statistics from customs agencies, however, shows that consumption and coffee imports are present across the Middle East from Algeria and Morocco in the west, over the Northern African markets of Tunisia, Libya and Egypt, across the Saudi Arabian peninsula and Turkey to the Gulf Region. The region, which includes over 15 countries, together boosts coffee consumption of between 4.5 million and 5 million bags, customs figures show.

The London-based market intelligence firm Euromonitor International Ltd said in a report last year that the UAE is “the fastest growing market for coffee in the world.” Euromonitor has projected growth in total coffee volume sales at 80% between 2009 and 2014, with average annual growth of 12 percent.

“The United Arab Emirates represents the fastest growing market by volume for coffee in the world, despite the country falling into recession by the fourth quarter of 2008. This growth also comes amidst a still dominant tea drinking tradition in the country,” said Euromonitor in a 2013 report. Despite that fact that “more than 50% of the UAE’s population” hail from East Asia and the Indian Subcontinent with a consumer base that favors tea over coffee, the growth in coffee has primarily been driven by the emerging café culture and rising per capital income.

Since the earliest of times in coffee, the Middle East is where coffee drinking as we know it today began. And since the first cup of brewed coffee was enjoyed at least 600 years ago, coffee consumption has been at the heart of Middle Eastern culture, used as the standard welcome at hotels and at home. Today, this part of history is thriving and industry officials believe this may be why the Middle East is bound to become one of the emerging markets with highest growth potential in the next 10 years.

“Coffee is such an important part of our culture here and it has such a deep-rooted history as it since centuries ago has been used as the way to welcome your guests, whether in your home or at formal meetings,” said Al Mulla. “Go to any hotel in Dubai, and in the very most of them you will be welcomed with an Arabic coffee as this is a symbol of hospitality and way of bidding visitors welcome.”

The hotel industry is one that is attracting special attention from the coffee industry and for very good reasons: Construction of new hotels are experiencing a boom of its own, as Dubai and the UAE is preparing to host the 2020 World Expo while neighboring Qatar will host the World Cup in 2022. This boom is not only benefitting the number of tourist and business arrivals but is also expected to create a surge in coffee consumption.

UAE residents currently consume an average 3.5 kilogram of coffee per year, nearly double that of other Gulf countries, according to the international Coffee Organization. Malongo’s Rouchon believes Qatar is headed in the same direction, along with other Gulf markets such as Bahrain, Saudi Arabia and Jordan. Jordan, a market with a population of just over 8 million people with a long history of coffee drinking, is also seen as one of the key coffee hubs in the future of the Middle East.

Coffee drinking in the Middle East is as colorful and exotic as the ancient spice trading route that first brought coffee out of Etiopia to Dubai on its way to the ruling elite of the Ottoman Empire in Istanbul. In Dubai the older generation still prefers to take their coffee with Bedouins brewing the coffee in their tents on oriental rugs while in Jordan – which also is home to a large population that originated from the Bedouins – one of the most popular ways for locals to take their coffee is finding the street vendors in the capital of Amman. The younger generation, however, has …

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