Malaysia's Domestic Coffee Market Valued At US$1.05 Bln -- Chan

KUALA LUMPUR, July 30 (Bernama) -- Malaysia’s domestic coffee market is valued at US$1.05 billion (US$1=RM4.23), with over 6,400 cafes operating nationwide, said Deputy Plantation and Commodities Minister Datuk Chan Foong Hin.

Speaking to reporters at the 24th edition of the Malaysian International Food and Beverage Trade Fair (MIFB 2025) and Malaysia Cafe Expo (MCE), Chan said the external pressures highlight why Malaysia should expand domestic coffee cultivation for local consumption.

“Strengthening our own production is the way to ensure the cafe economy continues to thrive while positioning Malaysia as a credible origin in the global coffee trade. 

“As far as I know, one of the key areas where coffee is planted in Malaysia is in Pagoh, Johor, and Ranau, Sabah. Even though coffee is not under my ministry, I urge the planters to look into these crops, which have a huge prospect in Malaysia,” he said.

While demand for coffee is booming, Chan noted that the global coffee supply chain is facing increasing volatility.

For instance, Brazil’s 2024 Arabica harvest has been cut by around 12 per cent due to El Nino-driven droughts.

Simultaneously, the Red Sea crisis has forced shipping routes to detour by over 5,000 kilometres, adding US$0.12 per pound to US$0.15 per pound to coffee landed at Port Klang.

“These combined pressures have pushed the International Coffee Organisation’s composite price indicator up by a staggering 94.6 per cent in just one year,” he said.

Chan added that coffee rarely comes alone, as it almost always comes with a bakery to complement the coffee culture. 

This opens an important connection to one of Malaysia’s key strengths, palm oil, as bakery products rely on palm-based ingredients, particularly margarine, shortening, and cocoa butter equivalent (CBE), he said.

He noted that CBE is widely used in chocolate-flavoured pastries and confections as a substitute for cocoa butter, making it a vital component in the growing artisanal and commercial bakery segment. 

“This reinforces how Malaysia’s palm oil industry is deeply interwoven with the rise of coffee culture and the cafe economy,” he said.

-- BERNAMA