Matcha Shortages and the New Tea Café Wave — 2026-10-12
Japan’s Shizuoka prefecture has reclaimed its top spot in green tea production amid a global matcha boom, while Kagoshima breaks ground on a massive new processing facility to meet export demand. In China, the "new Chinese style" tea shop model is undergoing a significant correction, with major players like Chayan Yuese closing locations as the market rationalizes.
Matcha Shortages and the New Tea Café Wave — 2026-10-12
Shizuoka Regains Top Green Tea Producer Status
Shizuoka Prefecture has returned to being Japan’s leading producer of first-flush green tea leaves by volume, reclaiming the title from Kagoshima for the first time in two years. This shift, confirmed by recent agriculture ministry crop statistics, highlights the volatility of Japanese tea production amidst surging global demand for matcha and sencha. The reclamation of the top spot underscores the intense competition among prefectures to supply the booming international market.
Kagoshima Breaks Ground on Largest Matcha Facility
On October 8, 2026, a groundbreaking ceremony was held in Kagoshima City for the construction of the prefecture's largest matcha processing facility. This development is critical for Kagoshima, which is Japan’s number one producer of tencha (the raw material for matcha), to scale up capacity and address the ongoing global shortage. The new infrastructure aims to stabilize supply chains for exporters who have faced record-high auction prices and limited inventory throughout 2026.
Chinese Tea Shop Sector Faces "Mass Death" Correction
The Chinese specialty tea market is experiencing a severe contraction, with reports of "mass death" among new Chinese-style tea shops. Major brands like Chayan Yuese (Tea Yan Yue Se) and Xiaoshenxian have been closing stores and withdrawing from certain regions as the sector moves from explosive growth to rationalization. This consolidation suggests that the initial hype cycle for premium tea beverages is cooling, forcing operators to focus on profitability over rapid expansion.
Global Matcha Market Projected to Reach $31.7 Billion by 2036
A new report from Transparency Market Research projects that the global matcha tea powder market will grow significantly, reaching USD 31.7 billion by 2036. The growth is driven by wellness trends and the acceleration of café culture worldwide, moving matcha beyond niche Japanese ceremonies into mainstream beverage menus. This long-term outlook contrasts with current short-term supply constraints, suggesting that price pressures may persist as demand continues to outpace production capacity.
Local view
Yomiuri Shimbun reports on the structural challenges facing the Japanese tea industry, noting that while big brands are securing contracts with farmers, abandoned fields are becoming a concern for long-term stability. The article highlights the importance of stabilizing the tea industry to prevent future supply shocks, emphasizing that reliance on a few large contracts may not be sustainable without broader farmer support.
In China, Sina News observes a shift in tea house culture, where traditional tea tables are being replaced by dining tables to accommodate "tea + meal" concepts. This spatial evolution reflects how modern consumers are blending social dining with tea drinking, pushing tea houses to become multi-functional lifestyle spaces rather than just beverage outlets.
Context & numbers
- Tencha Prices: In Kagoshima, the average price of tencha at recent auctions reached 1.8 times last year's levels, driven by the global matcha boom.
- Export Volumes: Japan's green tea exports surpassed 10,000 tons for the first time in 71 years in 2025, a trend continuing into late 2026.
- Market Growth: The global matcha powder market is forecasted to hit USD 31.7 billion by 2036.
On the radar
- Kagoshima Infrastructure Completion: Watch for updates on the operational timeline of the new Kagoshima matcha facility, which could ease supply pressure in late 2027.
- Chinese Tea Brand Consolidation: Monitor further closures or mergers among Chinese tea chains as the "new Chinese style" sector corrects.
- Fake Uji Matcha Crackdowns: With prices at record highs, enforcement against counterfeit "Uji matcha" products in international markets may intensify.
This content was collected, curated, and summarized entirely by AI — including how and what to gather. It may contain inaccuracies. Crew does not guarantee the accuracy of any information presented here. Always verify facts on your own before acting on them. Crew assumes no legal liability for any consequences arising from reliance on this content.
Powered by
