Matcha market is anticipated to grow at a CAGR of 7.9% during the forecast period (2024-2031). The market growth is attributed to growing demand for natural and organic products, such as matcha, is increasing owing to concerns about synthetic additives and chemicals in food and beverages.  According to the National Institute of Health (gov.), in January 2021, the chemical composition of matcha green tea is rich in natural antioxidants called polyphenols, which make up around 30% of its dry weight. These polyphenols are believed to have powerful antioxidant properties similar to vitamins C and E, carotene, and tocopherol. The concentration of these health-promoting compounds in tea beverages varies depending on factors such as the type of tea, the quantity of tea leaves used, and the brewing temperature and duration.

Market Dynamics

Increasing Popularity of Matcha Globally

Matcha's global popularity is boosted owing to its unique flavor, health benefits, and versatility in various food and beverage applications, driven by health-conscious consumers seeking natural and functional ingredients. According to the National Institute of Health (gov.) in March 2023, Matcha, known for its unique green aroma and expanded food processing characteristics, has gained popularity not only in China but globally. China accounts for approximately 60% of global matcha production. The matcha industry has seen significant growth due to the diversification of matcha products and the increasing number of matcha consumers. Previous studies have shown that the flavor quality of matcha is determined by its aroma and taste, which are influenced by chemical constituents such as free amino acids, tea polyphenols, and L-theanine. The production process of matcha, which involves shading the leaves, contributes to its unique taste and sensory quality.

The Growing Influence of Health and Wealth Trends

Consumers are increasingly seeking natural and functional beverages that offer health benefits in addition to simple refreshment drinks. As a result, there is a rising consumption of tea, and accordingly, companies are launching new and innovative solutions to meet this growing demand. According to a study published in the American Journal of Clinical Nutrition, in November 2022, researchers found that consuming matcha green tea can significantly increase thermogenesis, causing the body to burn calories at a rate between 35% to 43% of daily energy expenditure. This is a substantial increase compared to the standard rate of 8% to 10%. Interestingly, none of the participants reported any side effects, and there was no change in their heart rates, indicating that the increase in energy expenditure was not due to exercise.

Market Segmentation

Our in-depth analysis of the global Matcha market includes the following segments by product type, form, and distribution channel:

• Based on product type, the market is sub-segmented into regular tea, matcha beverages, food, and personal care & cosmetics.

• Based on form, the market is bifurcated into powder, and liquid sources.

• Based on distribution channels, the market is augmented into hypermarkets/supermarkets, specialty retail stores, online retail stores, and others. (convenience stores, and tourism and hospitality)

Regular Tea  is Projected to Emerge as the Largest Segment

Based on the product type, the matcha market is sub-segmented into regular tea, matcha beverages, food, and personal care & cosmetics. Among these, the regular tea sub-segment is expected to hold the largest share of the market owing to the increasing per capita tea consumption in developing economies, driven by rising incomes, lifestyle changes, and health benefits, is on the rise in East Asia, Africa, Latin America, and the Caribbean. According to the Food and Agriculture Organisation of the United Nations(FAOUN), in 2022 Tea production globally reached an annual value of over $17 billion, while the value of the world tea trade is estimated at around $9.5 billion, making it a significant source of export earnings. It is noteworthy that smallholders contribute 60% of the globe's tea production. Moreover, tea cultivation generates employment opportunities in rural areas, empowering households and communities to address their food security needs and enhance their nutritional well-being. Over the past decade, per capita tea consumption has increased by 2.5%, particularly in tea-producing nations. The demand for tea has primarily been driven by developing and emerging economies, with East Asia, Africa, Latin America the Caribbean, and the Near East leading the growth.?

Tea is Largely Produced in Countries With Relatively Low Income (2020)

Source: According to the Food and Agriculture Organisation of The United Nations

Matcha Beverages Sub-segment to Hold a Considerable Market Share

The growing premiumization in the beverage market is driven by consumers' desire for high-quality, ethically sourced, and health-benefiting products, including ready-to-drink premium matcha beverages. For instance, in December 2022, MatchaKo introduced ready-to-drink premium matcha drink that is certified organic, non-GMO Project Verified, and vegan. It offered a healthier, lower-calorie alternative to sugary drinks. 

Regional Outlook

The global Matcha market is further segmented based on geography including North America (the US, and Canada), Europe (UK, Italy, Spain, Germany, France, and the Rest of Europe), Asia-Pacific (India, China, Japan, South Korea, and Rest of Asia), and the Rest of the World (the Middle East & Africa, and Latin America). 

North America

• The North American region owing to the growing trend of American customers adopting organic products and maintaining healthier lifestyles.

Global Matcha Market Growth by Region 2024-2031

Asia-Pacific Holds Major Market Share

Among all the regions, Asia-Pacific holds a significant share owing to the growing demand for government support and policy initiatives, including ambitious targets for increasing globalization and international trade have significantly boosted the global matcha market, enabling consumers to access high-quality matcha products from various regions through exports and imports. According to the Food and Agriculture Organisation of The United Nations (FAOUN), in 2022, world green tea exports are projected to experience steady growth in the coming years, with an estimated annual increase of 4.0%. The top three exporters, including China, are expected to contribute significantly to this growth, with China alone accounting for over 70% of global green tea exports. Vietnam and Japan are also anticipated to exhibit strong growth rates of 7.0 percent and 6.5 percent, respectively.

Market Players Outlook

*Note: Major Players Sorted in No Particular Order

The major companies serving the global matcha market include Aiya America Inc. AOI Tea Co., Jade Leaf LLC, Encha Organic Matcha, Midori Spring, and others.,and others. The market players are increasingly focusing on business expansion and product development by applying strategies such as collaborations, mergers, and acquisitions to stay competitive in the market. For instance, In Dember 202o, Springbot acquired Matcha, an all-in-one blogging platform for eCommerce brands, marking its first acquisition in its vision to become the all-in-one marketing platform for SMB retailers. 

• In March 2023, Kataoka & Co., Ltd. introduced Matcha Direct, an e-commerce service that allowed customers to order fresh matcha from a Kyoto tea factory.

The Report Covers

• Market value data analysis of 2023 and forecast to 2031.
• Annualized market revenues ($ million) for each market segment.
• Country-wise analysis of major geographical regions.
• Key companies operating in the global matcha market. Based on the availability of data, information related to new product launches, and relevant news is also available in the report.
• Analysis of business strategies by identifying the key market segments positioned for strong growth in the future.
• Analysis of market-entry and market expansion strategies.
• Competitive strategies by identifying ‘who-stands-where’ in the market.