The Great Matcha Shortage: an introduction

Slow. Steady. Explosive.

The Great Matcha Shortage: Part 1 - The Cause

The media has widely reported on the Matcha shortage—demand has outpaced supply. But is that really the case? What’s behind it?

In this two-part post, I share insights from the past decade and my travels to Japan, where I spoke directly with the experts who know best: the tea producers themselves. To truly understand the current situation, we must first look at Matcha through a historical lens—because the past holds valuable lessons for the present.

Japan’s Development of Matcha

Powdered tea was first introduced to Japan through cultural exchanges with China during the Heian period, around 806 AD. However, it wasn’t until the Song Dynasty, a few centuries later, that the practice of whisking powdered tea in a bowl with a bamboo chasen became more refined and widespread.

After its introduction to Japan, powdered tea’s adoption progressed slowly, hindered by years of internal civil war. It wasn’t until the mid-1500s that Chanoyu, the traditional Japanese tea ceremony, evolved into a form recognizable today.

So why is Matcha now known as a distinctly Japanese tea rather than a Chinese one? This is largely due to Japan’s isolationist Sakoku policy, enacted by the Tokugawa Shogunate from 1603 to 1868. During this time, Japan closed its borders, limiting foreign influence and restricting Japanese nationals from traveling abroad. Meanwhile, in China, the Ming Dynasty ushered in new tea production techniques, shifting away from powdered tea in favor of compressed and loose-leaf varieties.

With its borders closed, Japan continued to refine the production of powdered tea, transforming it from a bitter, medicinal-like substance into the smooth, vibrant, and nuanced tea we now know as Matcha—an essential element of the Japanese tea ceremony.

In essence, Japan’s period of isolation allowed it to refine its imported tea culture into something uniquely its own—an art form that, to this day, remains unrivaled in its delicate refinement and meticulous craftsmanship.

For centuries, Matcha was uniquely Japanese—a cultural treasure experienced firsthand by visitors to Japan or glimpsed through film and television. However, the practice of the traditional tea ceremony (Chanoyu) has steadily declined, as younger generations increasingly favor modern hobbies over time-honored rituals.

Historically, much of Japan’s highest-quality Matcha has been reserved for Chanoyu, with tea makers dedicating their finest stocks to the country’s many tea schools. But as participation in the tea ceremony waned, Matcha sales saw a sharp decline in the 1990s and early 2000s. Concerns grew that Matcha might become a relic of the past—an art form fading into obscurity, forcing farmers and producers to abandon generations-old businesses.

Growth in the west

When I began working professionally in tea in 2008, I witnessed firsthand the growing interest in Matcha as a “superfood” in New York City. Its rise in popularity was fueled by the idea that it contained a wealth of beneficial phytochemicals, including catechins and L-theanine. However, much of the Matcha available at the time was marketed simply as being from Japan, with little understanding of quality grades, production regions, or—least of all—cultivars.

Working at a Japanese tea store provided me with a unique perspective: customers initially bought Matcha for its health benefits, but they returned for its taste and the way it made them feel. They developed a real connection with the product, incorporating it into their daily, weekly, and yearly routines. Matcha became a staple in their lives in a way that other green powders—such as spirulina—did not. Of course, it’s important to remember that for many, their first experience with Matcha wasn’t through the drink itself but through sweets. Perhaps most famously, the Matcha Kit-Kat. This iconic treat, heavily marketed at Narita Airport gift shops, introduced even more people to Matcha, which at the time was often referred to as “the tea from Karate Kid 2.”

As far as I could tell, at the time, most tea makers hadn’t yet recognized the potential for the West to become a significant market for Matcha. Their focus remained on boosting domestic demand, primarily by selling tea at low prices to companies producing bottled teas—a practice that continues today.

The demand for Matcha has steadily grown—and continues to do so. This rise didn’t happen overnight. Over the past decade, Matcha first gained traction among early adopters before spreading to cities like New York and San Francisco, eventually becoming a significant part of popular culture. Not just a trend, but a staple.

Here to stay

In my opinion, Matcha’s widespread appeal comes down to several key factors. It has carved out its own category—not quite coffee, not just tea (though it is tea, people perceive it as distinct). It delivers a smoother, more tolerable caffeine experience for those sensitive to coffee. Its naturally rich taste, especially when blended with milk, has made Matcha lattes a gateway for many to discover and enjoy it.

Beyond taste and function, Matcha offers something deeper—a ritual of relaxation, a moment to slow down and be present. The artistry of its preparation, from the delicate tools to the serene aesthetic, adds to its allure. These qualities ensure that Matcha isn’t just a passing trend but a lasting and beloved beverage.

Demand x Demand

In the last five years, Japanese producers have increasingly recognized the West’s growing appetite for Matcha. While much of the Matcha consumed outside Japan is in latte form, the quality of Matcha used for these lattes has steadily improved.

At Kettl, for example, we introduced two new latte-focused Matcha offerings in the past two years—alongside our original and beloved Hukuju—after noticing a rising customer interest in learning and experiencing more. We sell out every month. So, does this mean the surge in demand for Matcha lattes is driving the shortage? In some ways, yes.

However, to truly understand where the shortage is most pronounced, you have to look at high-grade Matcha intended for traditional preparation. This is where we’ve seen extreme demand leading to frequent stock outs.

The current state of Matcha

About a year ago, a TikTok trend showcasing the most vibrant-colored Matcha took off, beginning in parts of Southeast Asia. This wave of Matcha reviews quickly went viral, and with each new post and repost, inbound orders to Japan for high-grade Matcha surged. At the same time, Japan experienced a record-breaking influx of foreign tourists post-COVID—many with high-grade Matcha at the top of their shopping lists.

The intensity of demand led to unprecedented sales for major Matcha producers like Ippodo and Marukyu Koyamaen, with both companies reportedly selling nine months’ worth of stock in a single month. It’s important to remember that high-grade Matcha, relative to other forms of green tea, is produced in very limited quantities. When soaring demand meets constrained production capacity, the result is inevitable: a shortage.

As of this writing, most major suppliers are carefully protecting their remaining stock. They’ve implemented strict purchasing limits—often restricting in-person buyers to a single 20g or 40g tin—while also removing products from their websites and third-party sellers like Amazon. Additionally, they are no longer accepting new foreign wholesale customers.

This strategic retreat almost mirrors Japan’s centuries-old Sakoku policy, when trade with the outside world was heavily restricted. However, the reality is different: the industry recognizes that its future depends on the West. Matcha is here to stay. The real question is how to scale production to meet demand. And the question every producer is asking: Is this surge real? If they invest in new factories or acquire more land, will the demand still be there in five years? I spent last month interviewing producers at origin and discussing together where we go from here. Can they make more? Should they make more? Is the global thirst for Matcha a good thing?

Part II of this post will explore what happens next.