Asia-Pacific will be key to the growth of the non-alcoholic beverages market, according to research by GlobalData.

Emerging and developing markets in the region are expected to account for 52% of incremental volume growth over the next five years, the research and intelligence company’s analysis shows, particularly in hot drinks and water.

Speaking at an event on the outlook for the non-alcoholic drinks sector, GlobalData consumer market intelligence director Suzanna Clarke said Asia-Pacific will provide “significant opportunities for further volume and value growth” in the sector.

The analysis by GlobalData, Just Drinks’ parent company, grouped the non-alcoholic drinks market into three categories: soft drinks, hot drinks and dairy and dairy alternatives.

Clarke said: “The Asia-Pacific region is responsible for a significant portion of incremental sector volume and value growth over the last five years.

“Asia’s emerging and developing markets have been significant contributors to both volume and value growth across all three non-alcoholic beverage sectors, especially in dairy and dairy alternatives, where value contribution is high across the Americas and Europe, Middle East, and Africa (EMEA), but volumes actually declined.”

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GlobalData Non-alcoholic sector
GlobalData research: 2021-2026F incremental volumes (bn) by regional economic status

She highlighted the potential of the EMEA region, where emerging and developing markets “have also helped to drive hot-drinks volume and value, as well as dairy and dairy alternatives value over the last five years”.

Asia Pacific and EMEA “are where significant opportunities for further volume and value growth can be achieved”, she added.

Looking at the specific categories in the non-alcoholic drinks market, GlobalData predicted hot beverages and water will perform best over the next five years, increasing by 83.1bn litres and 51.2bn litres respectively.

“The growing demand for speciality coffee and café-style experiences of coffee within the home have been key drivers of strong recent growth across Asia Pacific,” Clarke said. “Looking ahead, the rising population, growing disposable incomes and health-and-wellness trends are fuelling growth here.”

She said “healthier” and functional drinks will continue to do well in the region, and the demand for plant and herbal-based raw materials and beverages has increased significantly.

“Raw materials which help to support immunity like ginger, clove, lemongrass and nutmeg are becoming significantly important across several categories like iced teas and juice nectars.”

Emerging and developing markets across all regions are predicted to account for over three-quarters of all incremental value growth.

“In general, value growth is stronger across emerging and developing markets, as local brands lose market share to more premium global brands,” Clark explained. She added that higher levels of disposable income allow consumers to trade up.

Read more: What does the future hold for the non-alcoholic sector?

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