Africa Grows It, Vietnam Brews It, Nestlé Sells It Back: The Instant Coffee Scandal Africa Keeps Funding

Africa Brew Brief | Africa One Media

Africa's biggest instant coffee factory runs on Asian beans. When Nestlé reopened its expanded Estcourt plant in South Africa, every coffee bean going into Ricoffy, the country's best-selling instant coffee, came from Vietnam because local production was too small. At the time, that plant was Nestlé's largest of its kind anywhere in the world.

So the continent that gave the world coffee buys its morning cup back in a jar. The jar is filled with someone else's beans, processed in someone else's factory, and branded by someone else's marketing department. This edition asks why, and what it would take to change it.

## The Market: Big, Growing, and Hard to Measure

Nobody agrees on how big the instant coffee market is, and that tells you something about how little the industry wants to show. Narrow estimates put the global market at around USD 15 billion in 2025, rising to about USD 22 billion by 2034. Broader estimates, which count mixes, premixes, and ready-to-drink formats, put it above USD 42 billion in 2025 and close to USD 57 billion by 2030. Growth forecasts sit between 4% and 7% a year. Whichever number you pick, the market is growing.

Closer to home, the Middle East and Africa market was worth about USD 5.5 billion in 2025 and is heading towards USD 7.4 billion by 2031. Africa is not just a supplier in this story. It is a paying customer.

## How Instant Coffee Is Made

Instant coffee is coffee that has been brewed at industrial scale and then had all its water removed. The process runs in six stages:

- **Roast and grind.** Green beans are roasted, then ground coarsely so they don't clog the extraction columns.

- **Extract.** Hot water is pushed under high pressure through a series of columns, at temperatures far above anything a home brewer reaches. This pulls far more soluble solids out of every kilo of coffee.

- **Concentrate.** The liquid coffee is concentrated by evaporation or freezing. Aromas are captured separately and added back later.

- **Dry.** There are two routes. Spray-drying sprays the concentrate into a tower of hot air, producing powder in seconds. Freeze-drying freezes the concentrate into slabs, breaks them into granules, and removes the ice under vacuum.

- **Agglomerate.** Spray-dried powder is often re-wetted and clumped into the granules consumers recognise.

- **Pack.** The product is sealed in jars, pouches, or sachets, often under nitrogen to protect the flavour.

Spray-drying is the workhorse and holds the majority of the market because it is cheaper. Freeze-drying is the premium tier. In Japan, around 60% of instant coffee consumed is freeze-dried.

## The Bean: Why Robusta Rules

Instant coffee is overwhelmingly a Robusta product, for four reasons:

- **Yield.** Robusta gives more soluble solids per kilo, so a factory gets more powder from every tonne.

- **Cost.** Robusta trades well below Arabica.

- **Strength.** Its higher caffeine and heavier body survive harsh industrial extraction, where Arabica's delicate aromas tend to get lost.

- **Hardiness.** It grows at low altitudes in hot climates, which suits large-scale farming.

Vietnam is the centre of this trade. Close to 95% of its output is Robusta, and Switzerland, home of Nestlé, is its single biggest buyer, taking about 30% of Vietnam's coffee exports by value in 2025. Brazil is the other giant, running its soluble industry on home-grown Robusta (conilon) and exporting over 85,000 tonnes of soluble coffee in 2025.

Now look at Africa. Uganda, the continent's Robusta superpower, grows about 85% Robusta. Côte d'Ivoire, Cameroon, the DRC, Guinea, Togo, and Tanzania also grow it. Africa has exactly the raw material instant coffee needs. It just doesn't process it.

## Who Leads in Africa

**By country: South Africa.** It is the clear industrial leader, with Côte d'Ivoire as the historic pioneer. Around a decade ago, Africa had only four instant coffee plants, in Tanzania, Côte d'Ivoire, South Africa, and Egypt. South Africa won the scale race and is now positioned as the continent's coffee manufacturing hub.

**By company: Nestlé, and it is not close.** Nestlé spent about USD 84 million expanding Estcourt, which can produce up to 3.2 tonnes of coffee powder an hour. Two in every three cups of instant coffee drunk in South Africa are Ricoffy. Across the wider Middle East and Africa hot drinks market, Nestlé holds around 17% share, ahead of regional players such as Egypt's Badawy & Sons (Al Arousa).

Côte d'Ivoire is the cautionary tale. Capral-Nestlé was set up in 1962 to process coffee locally, mainly into instant. Its founding agreement let it buy green coffee at local prices, sometimes as low as a third or a quarter of world prices. That is value addition on paper, but the value flowed in one direction.

Uganda chose to outsource. Starcafé, a pioneer Ugandan instant brand, shipped containers of coffee to Tanzania for processing and brought them back for packaging.

## Who Drinks It

**Top 5 global consumers of instant coffee (by volume):**

1. **China.** Instant is the entry point for most new Chinese coffee drinkers.

2. **Russia.** More than 7 in 10 Russian coffee drinkers drink instant.

3. **Japan.** It is the world leader in premium freeze-dried instant.

4. **United Kingdom.** The British go to coffee shops for the "real thing" and drink instant at home.

5. **Indonesia and the Philippines.** These are sachet economies, where 3-in-1 mixes dominate.

Asia-Pacific accounts for roughly 35–45% of global instant coffee consumption. Even Vietnam drinks it heavily, with instant making up about 70% of domestic consumption.

**Top 5 African consumers (by value):**

1. South Africa

2. Egypt

3. Nigeria

4. Morocco

5. Algeria

South Africa, Egypt, and Nigeria are the anchors. Together with Saudi Arabia and the UAE, they make up nearly 60% of the region's instant coffee revenue. Algeria and Morocco are Africa's biggest coffee cultures overall, but they drink mostly ground coffee, so their instant share is smaller. Growth is coming through the sachet, as small pack sizes bring new households into the market across Nigeria, Egypt, and East Africa.

## The Uganda Vinci Affair: What Not to Do

Africa's most controversial attempt at instant coffee sovereignty was Uganda Vinci. In 2022, Uganda's finance ministry signed with an Italian investor's company to build an USD 80 million plant. It was meant to produce 27,000 tonnes a year of roasted, ground, spray-dried instant coffee and capsules, rising to 60,000 tonnes by year five. The terms included priority access to Ugandan coffee ahead of other export contracts.

Parliament killed the deal after finding the company had neither the money nor the coffee experience to deliver. President Museveni refused to back down, arguing that value-added coffee earns about USD 50 against USD 2 for raw beans.

His numbers can be debated. His diagnosis cannot. Even Nestlé, when lobbied years earlier to build in Uganda, chose to expand in South Africa instead, largely for logistics and infrastructure.

The lesson is uncomfortable for both sides. Africa needs processing, but it cannot get there by handing monopolies to unproven investors behind closed doors.

## The Stakes in One Number

Uganda earned about USD 2.4 billion from 8.4 million bags of coffee in the 12 months to October 2025. Almost all of it left as green beans. Imagine even 10% of that volume leaving as branded instant coffee, sold into Africa's own USD 5 billion-plus market.

## What Value Addition and Branding Actually Require

A dryer alone does not make a coffee industry. The real work is in six areas:

- **Product development.** Build Robusta-led blends tuned to each market: strong and sweet for West African sachets, smooth for Gulf hotels.

- **Formats.** Offer 2g sachets for mass reach, refill pouches for the middle class, and freeze-dried single-origin jars for export premiums.

- **Certification.** Get FSSC 22000 or ISO 22000 food safety certification, plus Halal for North Africa and the Gulf. Without it, supermarkets and hotel chains won't list you.

- **Packaging.** Glass jars, laminates, and nitrogen flushing are mostly imported today, adding cost and currency risk.

- **Distribution.** Informal retail decides who wins in Africa. Nestlé's real moat is not its factory. It is the millions of kiosks that stock its sachets.

- **Brand story.** "Ugandan Robusta" or "Ivorian origin" must mean something to the buyer. Origin branding works for wine and cocoa, and it can work for instant coffee.

## The Challenges

- **Capital intensity.** Even a modest plant needs at least USD 30 million, out of reach for most local processors.

- **Energy and water.** Extraction and drying are energy-hungry, and wastewater must be treated to standard.

- **Scale economics.** A new African plant running at half capacity struggles to compete with Vietnamese and Brazilian plants running flat out.

- **Policy risk.** Opaque deals, sudden export rules, and incentives that favour one investor scare off serious capital.

- **Consumer economics.** Price sensitivity is extreme, and chicory blends and cheap imports set a low price ceiling.

- **Brand trust.** Many African consumers trust the foreign brand over the local one, and closing that gap takes years of marketing spend.

## The Investment Required (Indicative Ranges)

- **Toll packing and blending operation:** USD 1–5 million. Buy bulk soluble coffee, pack it in sachets, and build a brand.

- **Mid-sized spray-dry plant (2,000–5,000 tonnes a year):** USD 30–60 million, plus working capital.

- **Large integrated plant with freeze-dry line:** USD 80–150 million.

- **Brand and distribution:** 10–20% of revenue for the first five years, the cost most feasibility studies forget.

## What African Governments and Agribusiness Must Learn

**1. Build the market before the factory.** Nestlé went where the logistics, consumers, and supply chains were. Governments that want plants must fix power, ports, and roads first.

**2. Transparency is a competitive advantage.** The Vinci saga cost Uganda years. Open tenders, published terms, and proven partners attract better investors.

**3. Consider a shared toll plant.** A publicly backed, medium-sized soluble plant open to local entrepreneurs would let small brands process their own coffee. It would also lift prices for low-grade beans.

**4. Use AfCFTA as a demand engine.** Nigeria, Egypt, and East Africa are buying more instant coffee every year. Selling Ugandan or Ivorian instant into Lagos and Cairo is easier than breaking into a UK supermarket.

**5. Turn rejects into revenue.** Low-grade beans that fetch poor export prices are perfectly fine for soluble coffee. That is a built-in margin advantage.

**6. Learn from Vietnam's own gap.** Even Vietnam, the Robusta king, processes only about 10% of its coffee at home. Volume alone does not create value. Processing and brands do.

**7. Partner, don't surrender.** Joint ventures with experienced processors, with local equity and real technology transfer, beat both colonial-style concessions and nationalist fantasies.

## The Bottom Line

Africa is not short of beans, consumers, or ambition. It is short of patient capital, reliable infrastructure, and honest deal-making. Until those change, the continent will keep growing the coffee, shipping it away, and paying a premium to drink it back.

The question for every coffee-producing government is simple: are you building an industry, or just hosting someone else's?

*Africa Brew Brief is the investigative editorial series of Africa One Media.*