Tea, functional drinks 'reign'

The global beverage industry has recorded a strong shift to health-supporting products such as mineral water, herbal tea... forcing businesses to step up product innovation.

Users tend to prioritize tea products and functional drinks. Photo: Phuong Lam.

Speaking at the “Beverage Industry Development” Conference on the morning of April 26, Mr. Jason Peng, senior consultant and food and beverage industry expert at Black Titan Beer, said that the global beverage industry picture last year recorded a strong shift towards health-supporting products.

In China, total beverage output in 2024 will reach 188 million tons, up nearly 8% year-on-year. Notably, product groups such as mineral water, bioactive tea, and specialized nutritional drinks will account for an increasingly large proportion.

Of these, tea drinks - known for their antioxidant, immune-boosting and metabolism-supporting properties - grew by nearly 11%. Functional drinks for sports, mental work and physical fitness increased by 18%.

Bottled water accounts for nearly 49% of the market share, reflecting the growing demand for clean, safe water in the context of rapidly changing living environments and nutritional habits.

However, the Chinese beverage industry also faces many challenges such as a debt-to-asset ratio of 52%, inventory increases of over 4% and nearly 22% of enterprises reporting losses. These pressures further force enterprises to increase investment in healthy product segments and sustainable production to maintain consumer confidence.

In Japan, the trend of “healthification” of the beverage industry has been taking shape for many years.

In 2023, the industry's total revenue will reach 4,450 billion yen (nearly 31 billion USD ), up 7%. Products such as herbal tea (24% market share), natural mineral water (21%) and sports drinks (11%) are all popular with consumers thanks to their outstanding health benefits.

In particular, the functional beverage segment exploded with a 110% growth in volume, recording more than 1,300 new products in just one year. These products directly target needs such as weight control, blood pressure stabilization, blood sugar regulation, digestive support and immune enhancement.

Big names like Coca-Cola Japan, Suntory and Asahi have also quickly caught up with the trend, continuously launching sugar-free herbal tea lines or using Erythritol - a safe sweetener - to replace refined sugar, meeting the need to control blood sugar and prevent chronic diseases.

In addition to products, many businesses are also promoting initiatives to reduce environmental impacts. Of these, easily recyclable PET bottles account for 79% of the market share, demonstrating the connection between the goal of protecting public health and the commitment to reducing ecological footprint.

According to Mr. Nguyen Van Viet, Chairman of the Vietnam Beer - Alcohol - Beverage Association (VBA), consumers are increasingly demanding, the market is constantly changing and the need for sustainable development is becoming urgent, forcing businesses in the industry to accelerate transformation to adapt.

To meet new demands, many businesses have actively sought solutions to innovate technology, optimize production processes and improve packaging in an environmentally friendly way. This is not only a trend but also a mandatory requirement if they want to maintain competitiveness in the current period.

The Chairman of VBA said that in the new context, optimizing production costs, boldly improving processes, investing in advanced technology systems, applying solar power, renewable energy, recycling by-products and using alternative materials are becoming vital strategies.

Businesses not only aim for environmentally friendly products but also have to ensure energy-saving operating processes, limiting negative impacts on the ecosystem.

Source