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Navigating the Green Drought: Understanding the Global Matcha Shortage

General Report March 15, 2025
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TABLE OF CONTENTS

  1. Summary
  2. The Matcha Shortage Crisis
  3. Rise in Matcha Popularity
  4. Supply Chain Disruptions and Their Effects
  5. Voices from the Ground: Retailers' Perspectives
  6. Exploring Alternative Sources and Solutions
  7. Conclusion

1. Summary

  • Currently, the world of matcha—a vibrant green tea powder known for its rich flavor and numerous health benefits—is facing a significant crisis due to an unprecedented shortage. This predicament arises from a sharp increase in demand, primarily fueled by changing consumer preferences towards health-conscious choices and the influence of social media. Over recent years, matcha has been widely embraced as more than just a beverage; it has emerged as a cultural trend among millennials and Gen Z consumers who are drawn to its aesthetic and wellness properties. As this enthusiasm continues to surmount, issues surrounding supply chain disruptions have intensified, reflecting the fragility of the matcha industry in the wake of a global pandemic. Many tea retailers and consumers are now navigating a challenging landscape characterized by increased prices, restricted supplies, and heightened competition among businesses scrambling to secure their product offerings.

  • The shortage has revealed significant implications for consumers and retailers alike. Cafes and specialty tea shops are reacting to dwindling stocks and rising costs by adjusting their pricing models, raising the prices of matcha-infused beverages significantly to offset supplier hikes. This has not only sparked dissatisfaction among customers but also prompted them to seek alternative sources—some turning to lesser-known matcha brands or lower-grade options. Insights from industry professionals underscore a collective understanding that, despite the challenges, there are opportunities to strengthen supply chain resilience. By examining the broader matcha landscape, this report provides a thorough overview of the causes behind the shortage, the perspectives of various stakeholders, and their underlying motivations for seeking sustainability amidst supply challenges. As we move forward, understanding these dynamics sheds light on the current and future state of matcha in an increasingly competitive market—where consumers desire access to quality products, and businesses strive to navigate the complexities of supply and demand.

2. The Matcha Shortage Crisis

  • 2-1. Overview of the current matcha shortage

  • The global matcha shortage has emerged as a significant concern for consumers and businesses alike, primarily driven by an unprecedented surge in demand along with supply chain disruptions. Since the onset of the COVID-19 pandemic, which prompted tea farmers in Japan to cut back on production in anticipation of decreased consumer demand, the matcha supply has not fully recovered. Despite recent efforts to ramp up production, including addressing conditions such as adverse weather and limited grinding capabilities, the available matcha has not kept pace with the soaring global interest in this vibrant green tea powder.

  • According to industry reports, matcha producers like Marukyu Koyamaen and Ippodo Tea have begun to impose purchase limits on their products due to depleted stocks and escalating consumer demand. This shortage has been exacerbated by the realities of tea cultivation; matcha leaves can only be harvested once a year, meaning that producers anticipate running out of stock before new crops are matured and ready for harvest in mid-2025. This bottleneck has left retailers scrambling to meet consumer expectations, with many turning to alternative sources to mitigate supply shortages, including imports from lesser-known farms or lower-grade matcha products.

  • 2-2. Impact on retailers and consumers

  • Retailers across Singapore and other regions heavily reliant on matcha have already begun to feel the ramifications of this supply crisis. Many cafes and tea shops report experiencing shortages that have led to significant adjustments in their product offerings. For instance, popular establishments have raised prices significantly—by as much as 10 to 15 percent—in an effort to offset the rising costs from suppliers. This price increase has become a point of contention between businesses and customers, as many consumers are unwilling or unable to pay more for a beloved beverage or food item that was once more affordable.

  • Consumer experiences highlight the emotional toll of the matcha shortage. For example, enthusiasts like Jillyn Lee, who made a special trip to Japan to stock up on matcha, have indicated increasing frustration over product availability. Observations of long queues outside tea shops indicate that many consumers are willing to wait, sometimes in vain, for beloved matcha items. Moreover, some customers are turning to online resellers where prices have surged to triple the standard retail cost, raising questions about accessibility and fairness in the market.

  • 2-3. Recent price hikes and scarcity experiences

  • As the matcha shortage persists, price hikes have become an almost ubiquitous experience for both consumers and retailers. Notably, suppliers in Japan have restricted sales not only due to lower production capacity but also to ensure equitable distribution among existing clients. This situation has forced retailers to limit consumer purchases to ensure that all customers can still access matcha products. This scarcity has led brands and retailers to find innovative solutions such as smaller, more frequent orders which, while helpful in maintaining some level of stock, have also led to increased shipping costs, further impacting prices.

  • Locally, the stories of retailers' responses to the crisis can vary significantly. Some companies report having to make challenges amidst rising operational costs. For instance, Tealife, an online retailer, noted a staggering 60 percent drop in supply month-over-month, forcing them to make tough choices about how to serve their loyal customer base. In contrast, newer businesses like Mori Matcha have managed to navigate the crisis with smaller stock requirements, allowing them to maintain some stability in their supply despite escalating challenges. This duality starkly illustrates the complexities faced within the supply chain as well as the consumer sentiment tied to such shortages, both leading to increasingly unstable market conditions.

3. Rise in Matcha Popularity

  • 3-1. Cultural trends contributing to matcha's fame

  • In recent years, matcha has rapidly ascended to a position of prominence in global food culture, transitioning from a traditional Japanese beverage to an international phenomenon. This surge can largely be attributed to cultural trends that resonate with contemporary consumers' values such as sustainability, health, and aesthetic appeal. The matcha trend began gaining traction around the mid-2010s amidst a broader rise in interest in superfoods — nutrient-rich foods considered particularly beneficial for health. Matcha, with its vibrant green color and high antioxidant content, perfectly fits this narrative, presenting itself not only as a healthier alternative to coffee but also as a powerful source of energy without the jittery side effects often associated with caffeine. Furthermore, the cultural and historical significance of matcha, particularly tied to Japanese tea ceremonies, has added an allure of authenticity and depth to its reputation as a 'cultured' drink. As consumers increasingly seek products imbued with stories and traditions, matcha has become a symbol of a sophisticated lifestyle that embraces mindful consumption and wellness. Thus, matcha has earned its acclaim in the realm of both culinary and lifestyle trends, aligning perfectly with the modern appetite for authenticity and holistic health.

  • The global fascination with matcha was further exacerbated by the influences of popular culture and social media. After several years of vibrant images being shared on platforms such as Instagram, matcha began to be seen as more than just a drink; it evolved into a lifestyle accessory. Cafes and restaurants began crafting visually stunning matcha lattes and desserts that were designed specifically for social sharing. The restaurant Cha Cha Matcha, launched in New York City, became a pioneer in commodifying matcha’s aesthetic, decorated with visually appealing setups that were not only delightful to the palate but also eye-catching enough to attract social media attention. This phenomenon highlights how specific consumer products can be driven by visual culture in the digital age, fueling a cycle where more cafes introduce matcha to meet consumer demand, which in turn increases the product's visibility and desirability. As matcha's popularity continues to expand, it corresponds to a growing trend seen across various beverage categories; one that elevates consumer interests into an aesthetic experience, thus solidifying its place in popular culture.

  • 3-2. The role of social media in increasing consumption

  • Social media has been a pivotal force in the unprecedented rise of matcha consumption globally. With the advent of platforms like Instagram and TikTok, matcha has seized an unmistakable foothold in the online culinary landscape, where aesthetically pleasing photos and videos can create monumental shifts in consumer behavior almost overnight. In particular, Instagram foodie culture, which emphasizes visually appealing food and drink, has made matcha an icon of modern indulgence. Viral trends showcasing elaborate matcha drinks, such as matcha lattes topped with frothy crema and adorned with artistic patterns, have catalyzed immense interest, as users share their matcha experiences with a collective audience. The hashtag #matcha has garnered millions of posts, further highlighting how collective sharing influences trends that translate to increased sales and demand. Amidst this digital interaction, matcha enthusiasts often curate 'matcha journeys' through their content; they don't just drink it, they present it, thus fostering a community united by a shared love for matcha's unique qualities.

  • Moreover, the rise of TikTok during the pandemic played a significant role in this trend, introducing a new generation of consumers to matcha through home-making challenges. During lockdowns, many individuals turned to culinary exploration as a means of alleviating boredom, leading to a proliferation of DIY matcha recipes and simple preparation techniques. These quick, easily digestible videos demonstrated that making matcha at home can be a simple yet effective way to partake in the trend. This resulted in a greater understanding and appreciation of matcha, catalyzing a growing consumer base eager to try making their matcha variations, from lattes to baked goods. Additionally, platforms such as Pinterest have contributed by providing visual inspiration for matcha-based recipes, further cementing its status as a trendy choice in beverages. The result is an engaged community of matcha drinkers who are actively sharing their creative interpretations, all of which reinforces supply-demand cycles in the industry, demonstrating the powerful intersection of social media and consumption habits.

  • 3-3. Consumer demographics and preferences

  • An important aspect of matcha's rising popularity is the demographic diversity among its consumers, which has expanded significantly in recent years. Originally, matcha was primarily enjoyed by tea aficionados and health enthusiasts. However, today, it attracts a broader swath of the population, particularly millennials and Gen Z. These younger generations are more inclined to seek beverages that not only offer health benefits but are also visually attractive and customizable. The experimental nature of younger consumers aligns well with matcha's versatility — millennials and Gen Z alike are drawn to the drink's adaptability, allowing them to enjoy it traditional, in lattes, smoothies, or even desserts. The move toward healthy lifestyles and nutrition-conscious consumption further solidifies matcha's appeal, particularly as studies showcase its numerous health benefits, including antioxidants that help combat oxidation and inflammation.

  • Additionally, social media has played a crucial role not only in highlighting matcha's aesthetic benefits but also in engaging a diverse audience. Cafes that cater to contemporary tastes, showcasing lactofermented versions or colorful matcha drinks, have proliferated, exposing even those unfamiliar with Japanese culture to matcha. The increasing availability of quality matcha products through retail outlets, online stores, and even Instagram shops has made it accessible, further bringing in consumers who may not have considered trying it otherwise. Reports indicate significant adoption rates among consumers identified in urban centers, where lifestyle and wellness trends often penetrate faster and deeper. Concepts such as 'conscious consumption' have struck a chord with this demographic, leading them toward products that echo their values, making matcha not just a beverage but also a cultural statement. This consciousness regarding health and lifestyle choices, amalgamated with a preference for unique and visually stimulating products, centers matcha in a crucial trendline that signifies where consumer habits are headed.

4. Supply Chain Disruptions and Their Effects

  • 4-1. Key factors causing supply shortages

  • A confluence of factors has led to significant supply shortages in the matcha industry, primarily driven by an unprecedented surge in global demand. The matcha market, traditionally stable, has found itself in a precarious position as interest in the vibrant green tea has skyrocketed, particularly among health-conscious consumers and social media influencers. According to industry experts, the production of matcha is inherently limited because it is harvested only once a year in Japan. As such, when demand exceeded forecasts, suppliers began to impose limits on orders to manage their inventory effectively. Megumi Kanaike, manager of Sydney's Simply Native tea shop, noted an 'unexpected worldwide boom' in matcha's popularity, leading to an increase in sales by an astonishing 250% within a mere six months. This sharp increase has subsequently prompted concerns about potential shortfalls of products, despite assertions from some producers that there is still a satisfactory volume of matcha available. However, distribution challenges and logistical constraints have hampered the availability of these products to consumers, exacerbating the perceived scarcity.

  • Additionally, cultural phenomena have played a pivotal role in shaping matcha's popularity. The advent of platforms like Instagram has allowed matcha to attain a sort of 'celebrity status', significantly influencing consumer preferences. Influencers and celebrities showcasing matcha lattes and blended beverages have cemented its place as a lifestyle choice rather than merely a beverage. Consequently, demand has outstripped supply for the specific grades of matcha that have gained traction in these online communities, particularly ceremonial-grade matcha known for its superior quality. With tourism also contributing to this complexity, visitors to Japan have often purchased matcha directly from local farms, further limiting the supply available for export. The combination of these widespread dynamics has created a perfect storm that inhibits supply while fueling a growing appetite for matcha across various markets.

  • In summary, key contributing factors to the supply shortages of matcha include limited annual production, fluctuating global demand driven by influencer marketing, and logistical challenges that have emerged in distribution channels. Understanding these elements is crucial for navigating the current matcha landscape and anticipating future developments in availability.

  • 4-2. Insights from industry professionals

  • Industry professionals are acutely aware of the challenges posed by the ongoing matcha shortage and have shared their perspectives on how these developments are reshaping their businesses. For many professionals involved in the matcha supply chain, the situation reflects both a crisis and an opportunity. Yugo Enomoto from Osada Tea articulated that while there is 'more matcha today in the world than there ever has been', the active difficulties are more logistical than quantitative. His sentiment reverberated across the tea landscape, highlighting that market perceptions often override the actual brewing supply. Enomoto and his colleagues have pointed out that recent marketing strategies focusing on specific matcha products have contributed to perceived scarcity, as consumers heavily gravitate towards the brands that have achieved viral fame on social media.

  • Moreover, tea shop owners such as Lily Nguyen of Naau Cafe have had to recalibrate their inventory strategies in the face of surging demand. Nguyen indicated that they have increased their weekly orders from 1.5 kilograms to between 6 to 7 kilograms, a move reflective of the necessary adaptation to evolving market conditions. This adjustment, however, also encapsulates the realities of supply chain constraints as producers struggle to meet the exponentially rising order volumes. Tea professionals are now being challenged to seek innovative solutions for integrating alternatives, such as blending lesser grades of matcha without sacrificing the overall quality required by their discerning clientele.

  • Insights from industry leaders also underscore the importance of consumer education. As Arthur Tong, co-founder of Tea Craft, pointed out, the discrepancy between the grades of matcha has led to different levels of availability, with organic latte-grade matcha being more severely affected. Professionals recognize that as they explore other matcha grades, they must also communicate these nuances to consumers in order to maintain trust and customer satisfaction. Ultimately, the collective experiences and observations of industry professionals present both a striking reflection of the current shortage and a call to action to enhance supply chain resilience for the future.

  • 4-3. Regional disparities in availability

  • The matcha shortage has not only been a universal issue but has also highlighted stark regional disparities in availability. Impacted markets have included not only the producers in Japan but also international consumers and businesses heavily reliant on matcha imports. For example, reports have indicated that in cities like Singapore, businesses are feeling the pinch of rising prices, with some establishments raising their costs by 10 to 15 percent due to supply constraints. This uptick in price has forced cafe owners to seek innovative ways to respond to customer needs, often navigating the delicate balance between quality, price, and customer expectations.

  • Conversely, the situation is exacerbated by the geographical limitations inherent in matcha production, predominantly confined to Japan. As the country gears up for the next tea harvest, scheduled for May or June 2025, anticipatory concerns are already surfacing about whether supply limitations will persist. Tea enthusiasts visiting Japan have become keenly aware of the scarcity; one customer noted returning with 30 tins of matcha after a recent trip, reflecting both personal and community demand for the product. Additionally, some industry insiders fear that unless regional businesses adapt instantly and effectively, they could lose significant customer shares to alternatives or competitors.

  • Despite these challenges, the regional dynamics offer opportunities for deeper exploration into alternative sources and substitutes for matcha, especially in markets that are acutely sensitive to fluctuations in supply. This inherent disparity informs a broader narrative about supply chain resilience and flexibility, reinforcing the necessity for businesses to consider their sourcing strategies carefully and proactively.

5. Voices from the Ground: Retailers' Perspectives

  • 5-1. Experiences of Newly Established Retailers During the Crisis

  • New retailers entering the matcha market are facing distinct challenges as they navigate the current shortage. Take, for example, Matsu Matcha, an online retailer based in Singapore that launched just two months ago. Founded by Bryan Ong, the company imports premium matcha powder directly from Japan. Ong has found himself grappling with supply issues almost immediately after opening, underscoring how the global matcha shortage is affecting new players in the industry. He noted that some customers have subscribed to a six-month plan to secure their matcha, indicating both the high level of interest and the urgency created by supply limitations. As he explores alternative sources, the quest for consistent quality remains an integral part of his operations, highlighting the challenges faced by those newly trying to establish a foothold.

  • Similarly, retailers like Matcha Masta, co-founded by Tiara Hudyana and Wee Shu-Hui, have recognized the importance of distinguishing themselves in a crowded market. They developed a protein-infused matcha product to cater to health-conscious consumers. This innovative approach reflects how new entrants are adapting to supply challenges while seeking to carve out their niche. Yet, even they contend with the threat of running out of stock, which reflects the overarching concern many retailers face currently.

  • 5-2. Strategies Employed to Cope with the Shortage

  • Retailers are deploying various strategies to navigate the ongoing matcha shortage. Established brands like Matchaya have had to adapt their procurement processes extensively. Their general manager, Wade Huang, revealed that the tea company has resorted to ordering smaller, more frequent batches as a response to dwindling supplies. This shift, however, results in increased shipping costs and necessitates careful inventory management to avoid running out of crucial stock.

  • In contrast, newer companies like Mori Matcha have adopted flexible sourcing strategies to mitigate the risks associated with the supply chain disruptions. Co-founder Maverick Chua emphasized the importance of maintaining relationships with multiple suppliers to ensure they can deliver quality matcha without the interruptions impacting larger producers. Such strategies illustrate the adaptive nature of retailers in response to market volatility and serve as case studies in resilience amid adversity.

  • Additionally, the rising prices of matcha products have spurred innovative solutions among retailers. For example, some shops are offering limited-time promotions or bundled products to maintain customer interest while managing tighter margins. These efforts not only highlight the creativity of retailers but also point to the competitive nature of the industry as businesses strive to retain loyal customers during a frustrating period.

  • 5-3. Customer Reactions and Sentiments

  • The reaction of customers to the ongoing matcha shortage has significantly influenced the retail landscape. Many consumers are expressing disappointment over increased prices, with some reporting hikes between 10 to 15 percent since late 2024. Jillyn Lee, a matcha enthusiast, illustrated this sentiment; her journey into the world of matcha had culminated in a significant stockpile from her recent trip to Japan, costing $900 for 30 tins. This personal anecdote underscores the lengths to which customers are willing to go to secure their favorite products amidst scarcity.

  • Moreover, social media has become a platform for consumers to share their frustrations and experiences regarding the shortage. Posts showcasing lines outside matcha shops, or references to limits imposed by retailers, reflect the heightened awareness and emotional investment people have in this beloved tea. There’s a growing community sentiment that, while customers are willing to pay more, they are also becoming increasingly discerning about quality, knowing that not all matcha is created equal.

  • The reactions are particularly pronounced among younger demographics, who frequent cafes and online marketplaces where matcha has become a staple. As they grapple with limited stock and inflated prices, many are pursuing alternative options, leading to a growth in interest for smaller, local brands. This trend demonstrates not just a shift in purchasing behavior, but a potential redefinition of loyalty in the matcha market, where quality and experience weigh heavily against mere brand allegiance.

6. Exploring Alternative Sources and Solutions

  • 6-1. Identifying alternative matcha suppliers

  • As the global demand for matcha skyrockets, the urgent need for alternative suppliers has become apparent. Consumers and businesses alike are facing increasing difficulties in securing traditional Japanese matcha due to the ongoing supply shortages linked to overconsumption and production constraints. Amid this crisis, several international brands have emerged as viable alternatives to those primarily sourced from Japan. Notably, U.S.-based brands have begun cultivating their matcha production capabilities, offering high-quality products that can compete in flavor, texture, and overall quality with traditional sources. This shift not only helps diversify the market but also enables consumers to access quality matcha without relying entirely on the Japanese supply, which has been impacted significantly due to factors such as limited harvest seasons and heightened demand. By sourcing matcha from different geographical locations, consumers can enjoy similar tastes and health benefits while contributing to a more sustainable and resilient supply chain. This diversification is essential in mitigating future shortages and ensuring that matcha remains accessible during peak demand periods.

  • 6-2. Evaluating quality and authenticity of substitutes

  • As consumers seek out alternatives to traditional Japanese matcha, the evaluation of quality and authenticity becomes imperative. Not all matcha substitutes share the same flavor profile, nutritional value, or harvesting and processing standards. It is essential for consumers to familiarize themselves with the different grades of matcha available and understand their applications. The first harvest, known as ceremonial grade, is the premium product sought after for traditional preparation, thanks to its vibrant green color and nuanced flavor. In contrast, culinary and latte grades, which are harvested later, may be more readily available but do not offer the same taste or aesthetic appeal. Importantly, consumers should look for labels that specify the origin, quality certifications, and even the specific type of matcha used when exploring alternatives. Various testing methods exist to assess matcha quality, including examining the color and texture, taste testing, and checking for any additives or artificial flavors. Engaging in this due diligence will ensure consumers continue to enjoy genuine matcha experiences, even when opting for alternatives.

  • 6-3. Recommendations for consumers seeking their matcha fix

  • For consumers grappling with the matcha shortage, several strategies can be employed to ensure their green tea cravings are satisfied without compromising on quality. First and foremost, those accustomed to enjoying matcha lattes may consider switching to high-quality culinary-grade matcha for their beverages. While it may lack the refinement of ceremonial matcha, culinary-grade matcha can serve well in blended drinks, offering a robust green flavor ideal for milk and sweeteners. Additionally, exploring other green tea varieties such as gyokuro, hojicha, or yerba mate can provide unique taste experiences while still delivering the comforting and energizing effects associated with traditional matcha. Gyokuro, in particular, possesses a rich umami flavor akin to matcha and is known for its mellow sweetness, making it an excellent substitute in various applications. Furthermore, consumers are advised to practice mindful purchasing habits, ensuring that they are not contributing to overconsumption and that they respect the delicate balance of supply available. By adopting these practices, matcha enthusiasts can navigate the ongoing shortages and continue to indulge in their passion for green tea.

Conclusion

  • The ongoing global matcha shortage highlights the pressing challenges faced by both avid consumers and retailers striving to meet the rising demand. This situation, which has been precipitated by a combination of increased interest in matcha and substantial disruptions within the supply chain, calls for innovative adaptations within the industry. Retailers are hard-pressed to manage their inventories while experimenting with creative sourcing solutions, reflecting the need for flexibility and resilience in a market increasingly characterized by uncertainty. Furthermore, consumer awareness of the shortage may spur greater interest in exploring alternative green tea options, encouraging a diversification of purchasing habits.

  • In the wake of these challenges, emerging strategies reveal a pathway forward—one that emphasizes education, sustainability, and consumer mindfulness. Industry leaders and stakeholders are well-positioned to capitalize on this period of flux to not only enhance supply chain robustness but also to foster ongoing engagement with a discerning consumer base. By enhancing their messaging around product quality and sourcing, they can build trust and loyalty during these tumultuous times. The future of matcha hinges on the ability of businesses to navigate current shortages while remaining attentive to evolving consumer preferences, ensuring that enthusiasts will continue to savor the unique experiences associated with this treasured tea for years to come.

Glossary

  • Green Drought [Concept]: A term referring to the significant shortage of matcha, which is attributed to increased global demand and supply chain disruptions.
  • Matcha [Product]: A finely ground powder made from specially grown green tea leaves, known for its vibrant color and health benefits.
  • Ceremonial-grade Matcha [Product]: A high-quality matcha meant for traditional tea ceremonies, characterized by its vibrant green color and nuanced flavor.
  • Culinary-grade Matcha [Product]: A type of matcha that is more readily available and suited for cooking and baking rather than ceremonial use.
  • Supply Chain Resilience [Concept]: The ability of a supply chain to anticipate, adapt to, and recover from disruptions, ensuring consistent product availability.
  • Superfoods [Concept]: Nutrient-rich foods recognized for their health benefits, which have gained popularity among health-conscious consumers.
  • Consumer Demographics [Concept]: Categories and characteristics of consumers that influence their purchasing behavior and preferences in the market.
  • Visual Culture [Concept]: A societal trend where the aesthetic presentation of food and beverages plays a significant role in consumer appeal and marketing.
  • Alternative Matcha Suppliers [Company]: Non-Japanese brands and producers beginning to offer matcha products as alternatives to traditional Japanese sources.
  • Matcha Lattes [Product]: Beverages made by mixing matcha powder with hot or cold milk, often resembling traditional coffee lattes.

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