Hamburg, July 23 - German retail coffee sales in 2009 are stable despite the economic slowdown but a price war among supermarkets has further intensified, the head of Germany's coffee industry association DKV said on Thursday.
"Coffee sales are showing themselves to be secure against the crisis," association chief executive Holger Preibisch told Reuters in an interview.
"We are experiencing a very stable market demand overall with a light tendency towards growth."
German retail coffee trends seen in recent years were continuing so far in 2009, with strong growth being experienced in espresso drinks and single portion coffee drinks, he said.
Espresso sales had risen 20 percent on the year in 2008 partly because of increased popularity of drinks such as latte macchiato and cappuccino in cafes and coffee shops for which espresso is the basis.
Sales of new generations of automatic coffee machines for both household and catering use was boosting demand for single portion drinks.
Some demand weakness was being noted in isolated regions which had been especially hard hit by the economic slowdown, Preibisch said. Catering sales in companies were also sometimes hit by the large number of firms on short-time working.
"But coffee sales in the German market overall so far this year are stable or experiencing a light rise," he said.
Earlier this year, Germany's powerful discount supermarket chains started using coffee as a special offer to tempt people into shops. This trend had now spread to non-discount supermarkets and other retailers, Preibisch said.
"We are currently experiencing that supermarkets of all types are using coffee as a loss leader or special article on a permanent basis," he said.
Last week, one German discount supermarket chain cut a leading branded roast coffee price by 32 percent for a standard 500 gramme pack to 2.88 euros ($4.10), almost the same level as supermarket own brand prices of around 2.50 euros.
Average German retail price for a 500 gramme pack in 2008 was 3.84 euros.
Retail prices for a standard 500 gramme pack included some 1.30 euros in taxes as Germany has a special coffee tax as well as value added tax.
Preibisch made no comment on whether German coffee roasters could still achieve profits at such low prices.