Your browser does not support JavaScript!

Navigating the Green Gold Rush: Understanding the Global Matcha Shortage and Its Local Implications

General Report March 27, 2025
goover

TABLE OF CONTENTS

  1. Summary
  2. The Global Matcha Shortage: An Overview
  3. Retailers Grapple with Supply Challenges
  4. Local Impacts: Singapore and Australia in Focus
  5. Exploring Alternatives to Matcha
  6. Conclusion

1. Summary

  • The escalating popularity of matcha has catalyzed a significant global shortage that transcends mere supply and demand dynamics, impacting retailers and consumers on multiple levels. Gaining traction as a staple in health and wellness lifestyles, matcha's appeal has surged in social spheres, bolstered by visually enticing posts across social media platforms. As the pandemic magnified interest in health-focused beverages, this green tea phenomenon has prompted an unprecedented uptick in demand, leading to considerable supply chain disruptions. Businesses, particularly in regions like Singapore and Australia, now find themselves navigating a challenging landscape of increasing scarcity.

  • The nature of matcha production, rooted in traditional Japanese methods, creates inherent constraints that are being severely tested by this spike in demand. The seasonal nature of matcha cultivation—restricted to specific times of the year—limits supply, thus aggravating market dynamics. The meticulous processes involved in sourcing high-quality matcha, from the selective harvesting of leaves to the labor-intensive stone grinding, contribute to its scarcity. Retailers have responded by imposing purchase limitations and exploring alternative sourcing scenarios to navigate these constraints. Such adaptations reflect the shifting balance within the matcha market as it responds to consumer enthusiasm.

  • Amidst these challenges, innovative local brands are emerging, striving to satisfy the burgeoning demand while managing supply issues. The adaptations witnessed in Singapore and Australia signify a critical juncture in the matcha narrative, where the interplay of consumer behavior and market forces shapes the future of this cherished beverage. As consumers look for alternatives and retailers seek sustainable solutions, the discussion surrounding matcha echoes broader themes of sustainability and community engagement within the beverage industry.

2. The Global Matcha Shortage: An Overview

  • 2-1. Introduction to the global matcha shortage

  • The global matcha shortage has emerged as a significant concern as demand for this vibrant green tea continues to soar. Originating from Japan, matcha has transcended cultural boundaries, carving a niche for itself not only as a traditional beverage but also as a culinary ingredient in various modern recipes, particularly in the health and wellness sector. The surge in matcha's popularity can partly be attributed to social media, where visually appealing matcha-based drinks and treats have become a sensation. During the height of the COVID-19 pandemic, the demand for matcha saw an exponential increase, leading to unprecedented supply chain challenges.

  • Local retailers and consumers have begun feeling the pinch of this shortage, prompting many small businesses to emerge to meet the escalating demand even as they grapple with sourcing issues. As a result, both established and new matcha brands in regions like Singapore and Australia have started to implement purchasing limits on their matcha products, reflecting the tightening supply.

  • Key players in the industry, particularly suppliers from Japan, are currently facing constraints due to a combination of factors. The traditional production methods that characterize high-quality matcha demand significant labor and time, typically culminating in limited availability as the best leaves are harvested only during specific seasons. The intricacies of matcha processing involve meticulous stone grinding, a process that further restricts the quantity of matcha produced annually.

  • 2-2. Key causes behind the supply challenges

  • Multiple factors contribute to the current challenges faced in matcha supply, primary among which is the ongoing surge in global demand. Due to unforeseen rises in popularity, particularly highlighted by anecdotal evidence from retailers in Singapore and Australia, suppliers have struggled to match the pace of this increasing appetite for matcha. As Yugo Enomoto of Osada Tea highlighted, there has been a 'bold, green and attractive' boom in popularity, leading to difficulties in fulfilling orders and forced limitations on sales.

  • The limited production capacity of authentic matcha is exacerbated by the fact that the tea is harvested only once a year, making it particularly vulnerable to fluctuations in demand. For instance, the finest tea leaves, which yield the most desirable ceremonial matcha, are only available in early spring, creating a bottleneck effect in matcha supply chains. Seasonal considerations and climate conditions further complicate these dynamics, with adverse weather impacting crop yields, as evidenced by disruptions reported by various tea farms in Japan.

  • Moreover, logistical challenges, particularly post-pandemic, have hindered the movement of goods worldwide. This includes elevated shipping costs and reduced transit capacity, which retailers have attributed to the Covid-19 pandemic's lasting effects. Consequently, many businesses are now resorting to alternative sources and considering smaller farm operations to secure their matcha supply, leading to further complications in maintaining consistent product quality.

  • 2-3. Impact of rising global demand on matcha production

  • The rising global demand for matcha has led to significant impacts on its production dynamics. For instance, the industry foresaw a lowering of production during the pandemic, which resulted in many tea farms reducing their outputs in anticipation of decreased consumer interest. However, the opposite occurred; as lockdowns eased, consumers flocked to matcha as a comforting, health-oriented beverage, prompting an upsurge in consumption that far outpaced the available supply. Notably, retailers such as Matchaya in Singapore reported a reduction in their supply by approximately 10 to 20 percent due to increased order sizes and a constricted market environment.

  • In Australia, café owners are coping with the shortage by adapting their supply chains and blending different grades of matcha to meet customer needs without compromising quality. For instance, Ako Miura of Melbourne's Ima Pantry mentioned that matcha sales had overtaken coffee for their menu, underscoring a market shift that reflects changing consumer preferences and habits. The adaptation includes utilizing lower-grade matcha alternatives in latte preparations while balancing quality expectations from discerning matcha enthusiasts.

  • The competitive landscape has simultaneously opened pathways for new entrants to the market, resulting in innovation as businesses strive to differentiate themselves amidst the constraints. Brands like Mori Matcha and Matcha Masta have emerged, catering to specific niches, such as those seeking affordable matcha options or unique infusions with additional health benefits. As the demand for high-quality matcha continues unabated, the industry may evolve in ways that favor diversification and sustainable sourcing practices, ensuring that the rich tradition of matcha is not lost amidst its newfound global fame.

3. Retailers Grapple with Supply Challenges

  • 3-1. Challenges faced by new matcha retailers in Singapore

  • In Singapore, the emergence of new matcha retailers has coincided with a significant global shortage of matcha, forcing these businesses to navigate a complex landscape of supply challenges. One such retailer, Matsu Matcha, launched just two months ago and quickly encountered supply issues owing to the same global constraints. The founder, Bryan Ong, initially imported matcha powder from Japan but soon found his usual sources unable to fulfill orders due to widespread shortages. The cultivation of matcha, which has been a centuries-old tradition, is seasonal as the tea leaves are harvested once a year, leading to a cyclical production model that is easily disrupted. Several Japanese producers, including esteemed brands like Marukyu Koyamaen and Ippodo Tea, have reported significant limitations in their production capacities, leading to restrictions on customer purchases. As reported, some businesses in Singapore began noticing supply issues as early as late last year, signaling that the problem might be long-standing. Furthermore, these challenges are often exacerbated by logistical hurdles such as shipping delays and increased costs, which contribute significantly to the complexity of maintaining a stable supply chain for matcha products.

  • 3-2. Insights from Australian retailers on demand fluctuations

  • Australian retailers have mirrored the experiences of their Singaporean counterparts, witnessing substantial fluctuations in demand for matcha products. Cafes and specialty tea shops like Simply Native in New South Wales have reported implementing limits on online purchases due to overwhelming demand and shortages. The allure of matcha has surged tremendously, driven in part by social media trends and endorsements from celebrities, which have made it a popular choice among health-conscious consumers. As demand outpaced supply globally, restrictions implemented by major Japanese manufacturers meant that Australian retailers could not maintain consistent stock levels. This has resulted in many local shops grappling with how to manage customer expectations amidst rising prices and reduced availability. Reports have shown some Australian cafes resorting to higher pricing strategies, effectively passing on the costs of scarce matcha supplies to consumers. This dynamic has prompted retailers to seek alternative sources, increase their order frequency, or even pivot their menu offerings to maintain customer interest while minimizing the impact of supply inconsistencies.

  • 3-3. Longer wait times and pricing issues for consumers

  • Consumers are facing longer wait times and higher prices as a direct impact of the matcha shortage. In Singapore, reports indicate that matcha prices have surged by 10 to 15 percent since late 2023, with notable price hikes observed in local supermarkets and cafes. For instance, regular users of matcha powder, like Jillyn Lee, a local enthusiast, have noted significant increases in their spending habits on matcha products, reflecting the overall inflation in the matcha market. The scarcity has led consumers to look for alternatives, with some even resorting to purchasing from resellers who take advantage of the situation, often charging exorbitant prices. The issues over stock availability have also led consumers to queue outside tea shops and cafes, waiting for limited restocks, a practice that has become increasingly common. As matcha's reputation as a 'superfood' continues to grow, these challenges underscore a critical tension in the market: how to satisfy consumer demands without compromising quality or accessibility.

4. Local Impacts: Singapore and Australia in Focus

  • 4-1. Case studies of Singapore businesses adapting to shortages

  • In Singapore, the global matcha shortage has prompted local businesses to make significant adjustments to their operations. Many cafes and tea shops are experiencing acute supply challenges, directly affecting their product offerings. For instance, Jillyn Lee, a matcha enthusiast, recently highlighted the lengths to which she went, traveling to Japan to stock up on 30 tins of matcha worth $900. Such stories reflect a growing trend where consumers are forced to consider alternative sources to maintain their matcha ritual as local supplies dwindle due to increased global demand. Local establishments like Iroha Mart have reported increased prices for matcha products, some rising by 10 to 15 percent since mid-October 2024. This adjustment aligns with the broader trend of rising prices in the local market, where matcha’s scarcity has led to elevated costs. Particularly noteworthy is the 30g can of Rikyuen matcha powder, which has seen its price jump from $36 to approximately $40, illustrating how supply constraints are impacting pricing strategies. Despite these increases, tea shops are adamant about maintaining stock levels, often turning to online suppliers where they are facing the reality of limited shipments. Furthermore, significant delays in shipments have forced many establishments to alter their ordering practices. Matchaya, a popular tea room with multiple outlets, has had to switch to ordering in smaller, more frequent batches, resulting in higher shipping costs. This necessity underscores the supply chain disruptions caused by the widespread matcha shortage, highlighting the need for adaptability among local businesses.

  • 4-2. The social media influence on Australian matcha consumers

  • In Australia, the influence of social media on matcha consumption patterns cannot be overstated. High-profile influencers and enthusiasts, such as Tara Zaw, known as Melb Matcha Girlies, leverage platforms like Instagram to share tips on sourcing matcha products, thus exacerbating the demand. As followers become increasingly aware of matcha’s health benefits and culinary versatility, cafes across the nation are responding to heightened interest. For example, Ako Miura, owner of the cafe Ima Pantry in Melbourne, indicates that matcha has overtaken traditional coffee sales, now constituting 80 percent of their revenue. This transition has not only changed consumer preferences but has also influenced how businesses operate. Despite the reported shortages, Miura emphasizes that the global stock of matcha is at unprecedented levels, attributing perceived scarcity to logistics and effective marketing strategies, rather than actual supply deficits. Nevertheless, the impact of social media hype means that even brands with plentiful stock can face challenges meeting surging consumer demand. Cafes are now adapting their product lines to introduce blended options, such as using ceremonial-grade matcha in latte blends, striking a careful balance between quality and the need to satisfy avid matcha fans.

  • 4-3. Personal stories of local enthusiasts affected by rising costs

  • Personal narratives from matcha enthusiasts in both Singapore and Australia reveal the deepening impact of rising costs amidst the ongoing shortage. In Singapore, marketing manager Ang Wei Man expressed her frustrations over the escalating prices for matcha drinks, noting that items once priced below $10 now regularly exceed that mark. In her search for high-quality matcha, she resorted to online marketplaces, where some resellers charge up to three times the standard price. This trend illustrates how supply issues have led to not only price hikes but also shifts in consumer purchasing behaviors, as individuals seek more affordable alternatives. Meanwhile, in Australia, local consumers are similarly feeling the pinch of increased matcha prices. Reports indicate that many Australians are resorting to creative solutions, such as experimenting with homemade matcha recipes to avoid steep café prices. These adjustments reflect a broader consumer trend towards sustainability and self-sufficiency, although they also speak to the emotional investment that many individuals have towards matcha. As matcha enthusiasts engage with their communities online to share experiences and alternatives, the cultural significance of this beverage continues to evolve against a backdrop of challenging market conditions.

5. Exploring Alternatives to Matcha

  • 5-1. Potential substitutes for matcha lovers

  • As the global demand for matcha continues to rise, enthusiasts are increasingly seeking alternatives to satisfy their cravings for green tea. One popular substitute is **yerba mate**, a South American beverage brewed from the leaves of the Ilex paraguariensis plant. Unlike matcha, yerba mate contains caffeine that provides a smoother, more sustained energy release, making it a favored choice for those looking to cut back on traditional caffeine sources like coffee. Its grassy and slightly earthy flavor can provide a refreshing alternative to matcha lattes, especially when brewed with fresh fruits or herbal infusions. Additionally, it is available in both traditional and ready-to-drink forms, making it versatile for different consumption styles. Another potential substitute is **gyokuro**, known as "jewel dew, " which is a premium shade-grown green tea from Japan. This tea has a sweet, umami taste profile and is noted for its delicate brewing process, requiring lower water temperatures to release its flavors. Gyokuro resembles matcha in terms of cultivation; shade-grown leaves yield a similar richness and provide an elegant alternative for those craving the refined taste of Japanese green tea. For best results, brew gyokuro using 5 grams of leaves with water at 50°C to 60°C for about two minutes. Lastly, **hojicha** offers a different experience entirely. Made from roasted green tea leaves, hojicha possesses a warm, toasty flavor profile with less bitterness and lower caffeine content than matcha. It has gained traction in cafes, particularly in Australia, where it is featured in various drinks and desserts. Hojicha can be enjoyed whisked into a frothy beverage or incorporated into baked goods, making it an exciting alternative that holds onto the essence of traditional green tea.

  • 5-2. Emerging trends in green tea consumption

  • The matcha shortage has spurred interest in a broader range of green tea products, prompting consumers and retailers to explore alternatives. As highlighted by industry experts, the recent surge in green tea consumption aligns with growing consumer awareness of its health benefits and versatility. The trend encompasses not only traditional teas but also innovative blends that incorporate flavors and functional ingredients aimed at today’s health-conscious market. There is a noticeable rise in green tea blends that are infused with flavors such as lemon, blueberry, and ginger, appealing to younger consumers who are often driven by social media trends. These fruit-infused green teas offer a refreshing take on traditional beverages and provide accessible, vibrant options that capture the attention of matcha drinkers. Additionally, tea brands are experimenting with carbonated green tea drinks, effectively positioning themselves to compete in the growing ready-to-drink segment. This shift reflects how brands are responding to evolving taste preferences while also addressing the increasing demand for convenient, on-the-go options that blend the health benefits of green tea with modern consumer lifestyles. Furthermore, specialty stores and cafés are enhancing their offerings by including lesser-known varieties of green tea, such as *tencha* and *kamairicha*, which cater to consumers interested in exploring different flavor profiles. This innovative approach provides consumers with varied experiences that still embrace the heritage and specialty of traditional teas, mitigating the sense of loss from the matcha shortage.

  • 5-3. Advice for consumers navigating the shortage

  • With the current shortage of matcha affecting many enthusiasts, navigating the landscape of alternatives can be daunting. Firstly, consumers should consider experimenting with culinary-grade matcha, which is generally more accessible than ceremonial-grade matcha. This type of matcha is intended for cooking and mixing, making it suitable for a variety of beverages, including lattes and smoothies. While it may not have the same delicate flavor as higher-grade options, it still retains the antioxidant properties that many seek in matcha. Additionally, exploring local suppliers and specialty tea shops can yield unique finds that may not be available through traditional channels. Engaging with store staff can provide insights into lesser-known options or emerging brands that may offer better availability during the shortage. It is also advisable to stay informed about the harvest cycles of matcha; knowing the next harvest is typically in May or June can help consumers plan their purchases accordingly, allowing them to stock up when the product becomes available. Lastly, adopting a more diversified approach toward green tea consumption can enhance the overall experience. Integrating different types of tea into one’s routine can not only keep interest alive during the matcha shortage but also open doors to discovering new flavors and health benefits associated with various green tea varieties. Whether it be a soothing gyokuro or a refreshing iced yerba mate, embracing the variety can enrich tea-drinking habits and offer a deeper appreciation for the world of green tea.

Conclusion

  • The ongoing matcha shortage underscores the intricacies inherent in a market grappling with abrupt expansions in consumer interest, serving as a revealing case study of supply chain vulnerabilities. Retailers are embracing innovative practices to address current limitations while consumers are encouraged to pivot towards a spectrum of available green tea varieties and substitutes. In navigating this evolving landscape, the resilience of both consumers and businesses becomes evident as they adopt new strategies and explore diverse options to bridge the gap created by supply constraints. This scenario also hints at a potential transformation of consumer priorities, emphasizing the need for sustainable sourcing and educational outreach on matcha cultivation processes.

  • Looking ahead, the matcha industry may require a reassessment of how products are marketed and distributed, particularly as awareness around responsible consumption grows. Anticipating future trends, we may see a shift towards local sourcing and increased transparency in the supply chain, which could enhance trust in products. Concurrently, the market could evolve to accommodate a broader variety of green teas and related beverages, fostering consumer exploration beyond traditional matcha offerings. This evolving paradigm not only reflects adaptability but also positions the matcha market for resilience in an ever-changing retail environment. As challenges present new opportunities, it is evident that stakeholders must remain attuned to market fluctuations, ensuring they can proficiently navigate the complexities of the green tea landscape.

Glossary

  • Matcha [Product]: A finely ground type of green tea originating from Japan, known for its vibrant color and health benefits, often used in traditional tea ceremonies and modern culinary applications.
  • Yerba Mate [Product]: A South American beverage brewed from the leaves of the Ilex paraguariensis plant, providing caffeine and a grassy flavor, often considered a substitute for matcha.
  • Gyokuro [Product]: A premium shade-grown green tea from Japan with a sweet, umami flavor and delicate brewing process, serving as an elegant alternative to matcha.
  • Hojicha [Product]: A type of roasted green tea that has a warm, toasty flavor profile, lower caffeine content, and is becoming popular in various drinks and desserts.
  • Supply Chain Disruptions [Concept]: Challenges within the processes of production and distribution that affect the availability of goods, significantly impacting the supply of matcha during periods of high demand.
  • Culinary-Grade Matcha [Product]: A type of matcha that is more accessible and intended for cooking and mixing in beverages, providing an alternative for consumers during shortages of higher-grade matcha.
  • Social Media Influence [Concept]: The impact of social platforms on consumer behavior and trends, notably in how beverages like matcha gain popularity through visually appealing content and endorsements.
  • Sustainable Sourcing [Concept]: Practices aimed at ensuring that products are obtained in a way that maintains the ecological balance and supports local farming communities, relevant in the context of matcha production.
  • Local Brands [Company]: Emerging businesses in specific regions, such as Singapore and Australia, that strive to meet the increased demand for matcha while addressing supply challenges.
  • Ceremonial Grade Matcha [Product]: The highest quality of matcha made from the youngest tea leaves, typically used in traditional Japanese tea ceremonies, characterized by its vibrant color and rich flavor.

Source Documents