Beanless coffee, anyone?

Japan was where I had my first taste of hot canned coffee dispensed through a vending machine. It was also where I first encountered stand-alone vending machines on neighborhood sidewalks. Back then, they accepted only coins or small bills. Nowadays, they also accept electronic payments and IC train cards.

Japan, a natural trendsetter in ready-to-drink beverages, is about to become the first major test market for beanless coffee. Coca-Cola Japan has announced plans to introduce Georgia Cafe Water in September. The drink uses dietary fiber derived from corn, combined with proprietary flavoring agents, to recreate the sweetness, bitterness, and acidity associated with coffee. Because it contains no actual coffee beans, Japanese labeling rules prevent it from being marketed simply as coffee.

As a coffee consumer, I am curious about beanless coffee. I was never particular about bean origin, or roasting level. I am not a coffee connoisseur, but a consumer who is mostly about taste and price. Preparation is secondary, although I do prefer espresso over drip. Batangas espresso blend tops my list.

The choice of Japan is logical. The country has a mature ready-to-drink coffee market, extensive convenience-store and vending-machine networks, and consumers accustomed to frequent beverage innovation. A Japanese introduction gives Coca-Cola an opportunity to test consumer acceptance, pricing, and repeat purchases within an established mass-market system.

Coca-Cola is not alone. Asahi Soft Drinks is also entering the category with Future Latte this year, followed by a Future Black variant planned for 2027. Asahi is using plant-derived caffeine to retain one of coffee’s familiar functional benefits. The entry of two major beverage companies in the same market in the same year suggests that beanless coffee is moving beyond the startup stage.

Why now? Beanless coffee is best understood as a hedge against what is coming in the conventional coffee market. Studies and forecasts indicate that over the next five years, the industry is likely to face climate-related crop disruptions, tight inventories, volatile prices, and supply-chain strain. The numbers already point in that direction.

The US Department of Agriculture (USDA) forecasts world coffee production in the 2025/26 season to rise to a record 178.8 million 60-kilogram bags. Consumption is expected to reach a record 173.9 million bags, leaving a surplus of only about 4.9 million bags.

That margin offers limited comfort because inventories continue to shrink. Global stocks are forecast to fall to about 20.1 million bags in 2025/26, down from nearly 31.9 million bags in 2021/22. That is a decline of roughly 37% in four years. Smaller inventories leave the market with less protection against poor harvests, export disruptions, and unexpectedly strong demand.

The headline production figures also conceal serious problems beneath them. Brazil’s Arabica harvest is forecast to fall by six million bags after drought and high temperatures damaged flowering and fruit development. Production gains in Vietnam, Indonesia, and Ethiopia may lift the worldwide total, but they do not solve shortages of particular grades, origins, and flavor profiles that buyers specifically need.

In this environment, beanless coffee offers beverage companies an alternative source of coffee-like flavor that is less exposed to weather, land constraints, and agricultural price cycles. It may also allow manufacturers to blend conventional and beanless ingredients, reducing their dependence on increasingly expensive beans without asking consumers to abandon familiar products entirely.

The first major applications are likely to be in ready-to-drink beverages, vending systems, instant mixes, and institutional foodservice. In these markets, stable pricing, standardized flavor, and reliable supply can matter more than where the beans came from or which farm grew them.

Beanless products are therefore unlikely to displace specialty coffee, where consumers pay precisely for variety, processing method, place of origin, and distinctive taste. Beanless coffee is not for that market. For the mass market, however, it is a different story. And that is where the Philippines enters the picture.

By coffee-consumption volume, the Philippines is already among the largest markets in Asia. The USDA forecasts Philippine domestic consumption at about 6.75 million 60-kilogram bags in 2025/26, marginally above Japan’s 6.72 million bags. China follows at about 5.85 million bags, Vietnam at 4.9 million, Indonesia at 4.81 million, and South Korea at 3.4 million.

These figures reveal an important contrast in population, and coffee production and consumption. Vietnam is forecast to produce about 30.8 million bags while consuming only about 4.9 million domestically. Indonesia is expected to produce approximately 12.45 million bags and consume about 4.81 million. Both are major exporters.

The Philippines presents almost the opposite picture. It consumes roughly 6.75 million bags but produces only about 450,000 bags. Domestic output covers less than 7% of consumption. The country depends heavily on imported coffee, with the USDA forecasting imports of about 6.3 million bags in green-bean equivalent, meaning the raw unroasted beans that are then processed into soluble or instant form, in 2025/26.

This combination of high consumption and low domestic production could make the Philippines more commercially attractive for beanless coffee than its larger coffee-producing neighbors. Vietnam and Indonesia have substantial farming, processing, and export industries that may view beanless products as competitors to their own crops.

The Philippines has coffee farmers who need investment and protection, but its mass market is already supplied largely by imported and processed products. Beanless coffee could therefore be positioned less as a threat to a domestic export industry and more as an alternative source of supply for a heavily import-dependent consumer base.

At the mass-market level, much Philippine coffee consumption happens through soluble coffee, 3-in-1 mixes, and inexpensive single-serve sachets rather than freshly ground beans. Low- and middle-income households make up the largest group of consumers, many choosing 3-in-1 sachets because of their affordability and convenience.

In a 3-in-1 mix, the coffee is already combined with sugar, creamer, and flavoring. Consumers in this segment may be less concerned about bean variety or growing conditions than about whether the product tastes right, contains caffeine, dissolves easily, and costs no more than an ordinary sachet.

The most likely entry points would be a blended soluble product, a 3-in-1 sachet, a canned or bottled beverage, coffee pods, or an institutional foodservice mix. A manufacturer could initially combine ordinary coffee with beanless ingredients, reducing exposure to volatile bean prices without asking consumers to accept a completely unfamiliar product.

If you track the retail or grocery price of local coffee beans, they have gone up significantly in the last six years. Batangas barako, the liberica variety the region is known for, used to sell at the retail level for around P400 per kilogram before COVID. I now get mine for about P900 per kilogram.

That is not a universal market average, of course. Prices vary by grade, roast state, and whether you are buying at the farm gate, from a wholesaler, or off a retail shelf. But the direction is consistent with what the data shows. A 2026 retail price survey puts coffee in Metro Manila at between P798 and P1,312 per kilogram.

Also, the Philippines’ average import cost of coffee beans rose to $4.25 per kilogram in 2024 from $2.98 per kilogram in 2023, reflecting the same global price spike. And given the proliferation of coffee shops across the metropolis, demand is clearly at an all-time high.

So beanless coffee may be an option, particularly for coffee drink manufacturers. The risk is straightforward. But, beanless coffee manufactured abroad should not simply replace one imported ingredient with another. If the product enters the Philippine market without local blending, formulation, or manufacturing, it adds no value to the economy and may weaken the already fragile incentive to rehabilitate local farms and improve domestic production.

Any Philippine introduction should therefore be treated as a complement to local farm development, not a substitute for it. Even if the underlying beanless ingredients must initially be imported, blending, formulation, packaging, and product development can be undertaken locally. Over time, the country can also explore whether inputs or production technologies can be sourced or developed domestically.

Used as a complementary technology, beanless coffee could help the country meet growing demand while it strengthens its own coffee value chain. The beanless cup is coming. After Japan, we can be next. The question is whether Filipino farmers and manufacturers are at the table when it arrives, or watching from outside.

Marvin Tort is a former managing editor of BusinessWorld, and a former chairman of the Philippine Press Council.

matort@yahoo.com