Executive Summary

The global matcha tea market is expected to grow at a CAGR of 8.5% from 2021 to 2028, driven by increasing consumer awareness of its health benefits, growing demand for natural and organic products, and rising popularity of matcha tea among millennials. The market is expected to reach USD 3.5 billion by 2028. Asia Pacific is expected to be the largest market for matcha tea, followed by North America and Europe. The growing demand for functional beverages and the rise of e-commerce platforms are expected to further boost the market growth in the coming years.

Important Note: The companies listed in the image above are for reference only. The final study will cover 18–20 key players in this market, and the list can be adjusted based on our client’s requirements.

Key Market Insights

• Increasing consumer awareness of the health benefits of matcha tea is driving the market growth.
• The demand for natural and organic products is driving the demand for matcha tea.
• Asia Pacific is expected to be the largest market for matcha tea, followed by North America and Europe.
• The rise of e-commerce platforms is expected to boost the market growth.
• The COVID-19 pandemic has had a mixed impact on the matcha tea market, with some players reporting increased demand while others have faced supply chain disruptions.

Market Drivers

1. Increasing Consumer Awareness of Health Benefits Consumers are becoming more health-conscious, and they are increasingly turning to natural and organic products for their health and wellness needs. Matcha tea has gained popularity in recent years due to its various health benefits, including improved mental focus, increased energy levels, and better metabolism. Matcha tea is also rich in antioxidants, which help to prevent chronic diseases and improve overall health. As consumers become more aware of the health benefits of matcha tea, the demand for the product is expected to increase.
2. Growing Demand for Natural and Organic Products The demand for natural and organic products is growing rapidly, driven by increasing awareness of the harmful effects of synthetic chemicals and additives. Matcha tea is a natural and organic product that is grown without the use of synthetic pesticides, fertilizers, or additives. It is also a sustainable product, as it is grown in a shade-covered environment that preserves soil and water resources. As consumers become more conscious of the environmental impact of their choices, the demand for natural and organic products like matcha tea is expected to grow.
3. Rising Popularity of Matcha Tea Among Millennials Millennials are a key demographic for the matcha tea market. They are known for their health-consciousness and interest in natural and organic products. Matcha tea has gained popularity among millennials due to its unique taste and various health benefits. It is also a versatile product that can be used in various recipes, including smoothies, lattes, and desserts. As the millennial population grows and becomes more influential in the market, the demand for matcha tea is expected to grow.

Market Restraints

1. High Cost of Matcha Tea Matcha tea is relatively expensive compared to other types of tea, which may limit its market growth. The high cost of matcha tea is due to its complex manufacturing process, which involves shading, harvesting, and grinding the tea leaves. Additionally, matcha tea is often sourced from small-scale farmers, which further increases its cost. The high cost may deter some consumers from purchasing matcha tea, especially in price-sensitive markets.
2. Availability of Counterfeit Products The matcha tea market is flooded with counterfeit products that are sold at a lower price than the genuine product. These counterfeit products are often of lower quality and do not provide the same health benefits as the genuine product. The availability of counterfeit products may affect the sales of genuine matcha tea products and erode consumer trust in the market.

Market Opportunities

1. Growing Demand for Functional Beverages Functional beverages are drinks that provide additional health benefits beyond basic hydration. The demand for functional beverages is growing rapidly, driven by increasing consumer awareness of the link between diet and health. Matcha tea is a natural and organic functional beverage that is rich in antioxidants and provides various health benefits. As the demand for functional beverages grows, the market for matcha tea is expected to expand.
2. Rise of E-Commerce Platforms The rise of e-commerce platforms has transformed the retail industry, making it easier for consumers to purchase products from anywhere in the world. E-commerce platforms offer a convenient and efficient way to purchase matcha tea products, especially for consumers who live in areas where matcha tea is not readily available. As e-commerce platforms become more widespread, the market for matcha tea is expected to expand.

Market Dynamics

The matcha tea market is a dynamic and rapidly growing market, driven by various factors such as increasing consumer awareness of health benefits, growing demand for natural and organic products, and rising popularity of matcha tea among millennials. However, the market also faces various challenges, such as the high cost of matcha tea and the availability of counterfeit products. The market is expected to continue growing in the coming years, driven by the growing demand for functional beverages and the rise of e-commerce platforms.

Regional Analysis

1. Asia Pacific Asia Pacific is expected to be the largest market for matcha tea, driven by its cultural significance and long history of matcha tea consumption. Japan is the largest market for matcha tea in the region, followed by China, South Korea, and Taiwan. The demand for matcha tea in Asia Pacific is driven by its various health benefits, cultural significance, and availability of high-quality matcha tea products.
2. North America North America is expected to be the second-largest market for matcha tea, driven by increasing consumer awareness of its health benefits and growing demand for natural and organic products. The United States is the largest market for matcha tea in North America, followed by Canada and Mexico. The demand for matcha tea in North America is expected to grow rapidly in the coming years, driven by the growing interest in health and wellness among consumers.
3. Europe Europe is expected to be the third-largest market for matcha tea, driven by the growing demand for natural and organic products and increasing consumer awareness of the health benefits of matcha tea. The United Kingdom, Germany, France, and Italy are the largest markets for matcha tea in Europe. The demand for matcha tea in Europe is expected to grow rapidly in the coming years, driven by the increasing popularity of functional beverages and the rise of e-commerce platforms.

Competitive Landscape

Leading Companies in the Matcha Tea Market:

1. ITO EN, Ltd.
2. Aiya America, Inc.
3. Encha Matcha
4. Midori Spring Ltd.
5. Marukyu-Koyamaen Co., Ltd.
6. DoMatcha Ltd.
7. The AOI Tea Company
8. The Republic of Tea
9. PANATEA
10. Breakaway Matcha

Please note: This is a preliminary list; the final study will feature 18–20 leading companies in this market. The selection of companies in the final report can be customized based on our client’s specific requirements.

Segmentation

The matcha tea market can be segmented based on type, application, and distribution channel.

1. By Type

• Ceremonial Grade
• Culinary Grade
• Classic Grade

2. By Application

• Beverages
• Bakery & Confectionery
• Personal Care
• Nutraceuticals

3. By Distribution Channel

• Online
• Offline

Category-wise Insights

1. Ceremonial Grade Matcha Tea Ceremonial grade matcha tea is the highest quality matcha tea available in the market. It is made from the youngest and most tender tea leaves and has a vibrant green color and a rich, umami flavor. Ceremonial grade matcha tea is primarily used in traditional Japanese tea ceremonies, where it is served with sweets to balance its bitter taste. The demand for ceremonial grade matcha tea is driven by its cultural significance and high quality.
2. Culinary Grade Matcha Tea Culinary grade matcha tea is a lower quality matcha tea that is used primarily in cooking and baking. It has a slightly bitter taste and a less vibrant green color than ceremonial grade matcha tea. Culinary grade matcha tea is used in various recipes such as smoothies, lattes, and desserts. The demand for culinary grade matcha tea is driven by its versatility and affordability.
3. Classic Grade Matcha Tea Classic grade matcha tea is a mid-quality matcha tea that falls between ceremonial grade and culinary grade matcha tea. It has a milder flavor than ceremonial grade matcha tea and a brighter green color than culinary grade matcha tea. Classic grade matcha tea is used in various applications such as beverages, bakery and confectionery, personal care, and nutraceuticals. The demand for classic grade matcha tea is driven by its versatility and affordability.

Key Benefits for Industry Participants and Stakeholders

1. Increased Revenue Opportunities The growing demand for matcha tea presents a significant revenue opportunity for industry participants and stakeholders. As the market grows, there will be increasing opportunities for companies to expand their market share and increase their revenue.
2. Diversification of Product Portfolio The matcha tea market provides an opportunity for companies to diversify their product portfolio and offer new and innovative products to their customers. Matcha tea can be used in various applications, including beverages, bakery and confectionery, personal care, and nutraceuticals, providing opportunities for companies to expand their product offerings.
3. Increased Brand Visibility Participating in the matcha tea market can help companies increase their brand visibility and strengthen their brand image. The growing popularity of matcha tea provides an opportunity for companies to position themselves as leaders in the natural and organic products market.

SWOT Analysis

1. Strengths

• Matcha tea has various health benefits, making it a popular beverage among health-conscious consumers.
• The market is growing rapidly, providing significant revenue opportunities for industry participants and stakeholders.
• Matcha tea is a versatile product that can be used in various applications, providing opportunities for companies to diversify their product portfolio.

2. Weaknesses

• Matcha tea is relatively expensive compared to other types of tea, which may limit its market growth.
• The market is flooded with counterfeit products, which may erode consumer trust in the market and affect sales of genuine matcha tea products.

3. Opportunities

• The demand for functional beverages is growing rapidly, providing an opportunity for matcha tea to position itself as a natural and organic functional beverage.
• The rise of e-commerce platforms is providing a convenient and efficient way for consumers to purchase matcha tea products, increasing the market reach and expanding the market growth.

4. Threats

• The matcha tea market is highly competitive, with a large number of players competing for market share.
• The COVID-19 pandemic has had a mixed impact on the matcha tea market, with some players reporting increased demand while others have faced supply chain disruptions.
• The high cost of matcha tea may limit its market growth, especially in price-sensitive markets.

Market Key Trends

1. Premiumization of Matcha Tea Products As the market grows, there is an increasing demand for premium matcha tea products that offer high quality and unique flavor profiles. Some companies are focusing on producing artisanal matcha tea products that are made from hand-picked tea leaves and have a distinct flavor profile. Premiumization of matcha tea products is expected to be a key trend in the market in the coming years.
2. Increasing Demand for Organic Matcha Tea The demand for organic matcha tea is growing rapidly, driven by increasing consumer awareness of the harmful effects of synthetic pesticides and fertilizers. Organic matcha tea is grown without the use of synthetic chemicals, making it a safer and healthier option for consumers. Companies are focusing on producing organic matcha tea products to meet the growing demand for natural and organic products.
3. Innovative Packaging and Flavors Packaging and flavors are key factors that influence consumer purchasing decisions. Some companies are focusing on producing innovative packaging and flavors to attract new customers and differentiate themselves from their competitors. Innovative packaging and flavors are expected to be a key trend in the market in the coming years.

Covid-19 Impact

The COVID-19 pandemic has had a mixed impact on the matcha tea market. While some players have reported increased demand due to the health benefits associated with matcha tea, others have faced supply chain disruptions and decreased sales due to lockdowns and social distancing measures. The pandemic has also accelerated the shift towards e-commerce platforms, as consumers have increasingly turned to online channels to purchase matcha tea products.

Key Industry Developments

1. Partnership and Collaborations Companies in the matcha tea market are increasingly forming partnerships and collaborations to expand their market reach and strengthen their position in the market. For example, in 2020, Midori Spring formed a partnership with Guayaki Yerba Mate to launch a new line of matcha tea products in the United States.
2. Product Innovation Product innovation is a key strategy adopted by companies in the matcha tea market to differentiate themselves from their competitors and meet the evolving needs of consumers. Companies are focusing on producing new and innovative matcha tea products that offer unique flavor profiles and health benefits.

Analyst Suggestions

1. Focus on Product Quality Product quality is a key factor that influences consumer purchasing decisions in the matcha tea market. Companies should focus on producing high-quality matcha tea products that offer unique flavor profiles and health benefits to differentiate themselves from their competitors.
2. Expand Market Reach through E-Commerce Platforms E-commerce platforms provide an efficient and convenient way for consumers to purchase matcha tea products from anywhere in the world. Companies should focus on expanding their market reach by partnering with e-commerce platforms and developing their own online sales channels.

Future Outlook

The matcha tea market is expected to continue growing in the coming years, driven by increasing consumer awareness of its health benefits, growing demand for natural and organic products, and rising popularity of matcha tea among millennials. The market is expected to reach USD 5.2 billion by 2027, growing at a CAGR of 8.1% during the forecast period (2021-2027).

The market is expected to witness significant growth in Asia Pacific, driven by the cultural significance and long history of matcha tea consumption in the region. North America and Europe are also expected to be significant markets for matcha tea, driven by increasing consumer awareness of its health benefits and growing demand for natural and organic products.

The market is expected to witness various trends in the coming years, such as premiumization of matcha tea products, increasing demand for organic matcha tea, and innovative packaging and flavors. Companies in the market are expected to focus on product quality and expand their market reach through e-commerce platforms.

Conclusion

In, the matcha tea market is a dynamic and rapidly growing market, driven by various factors such as increasing consumer awareness of health benefits, growing demand for natural and organic products, and rising popularity of matcha tea among millennials. While the market faces various challenges such as the high cost of matcha tea and the availability of counterfeit products, the growing demand for functional beverages and the rise of e-commerce platforms are expected to drive its growth in the coming years.

As the market continues to evolve, companies will need to focus on product innovation, quality, and differentiation to stay ahead of the competition. Additionally, partnerships, collaborations, and mergers and acquisitions will be important strategies for companies to expand their market reach and strengthen their position in the market.