When I was in Japan this summer, I only saw two cafes that sold matcha: one with a 20 minute line, and one with a sign that limited customers to one tin only. Why is matcha, a product that originated in Japan, limited in the very country that produces it the most?
The short answer is: the production of high quality matcha from Japan is struggling to keep up with the demand. For those unfamiliar with matcha, it is a form of powdered green tea from a plant mainly grown in Japan that has gained immense popularity around the globe.
The hype for matcha can be observed in San Francisco, where matcha is best known as a green latte and has captured the hearts of many on social media. Just go to any cafe–the matcha latte can be found in almost every menu. Yet, on top of the increased demand which naturally leads to higher prices, matcha enjoyers in the United States are facing additional price increases from tariffs and a limited supply.
The price has already taken effect on cafes here in San Francisco: “Ever since the tariffs hit, the matcha prices have increased, and we bought more supply in case it would sell out,” explains Joanne Liu, who is a cashier and barista at Tadaima, a cafe in the Mission District that specializes in matcha drinks. “We had to increase our prices due to the tariffs,” adds Joanne.
Tadaima is extremely popular for matcha enjoyers in San Francisco because Tadaima uses ceremonial grade matcha–the most sought after type of matcha known for its high quality. Currently, in its powdered form, ceremonial grade matcha typically sells for over a dollar per gram, and is widely used in confectionery, like matcha lattes. The latte’s vibrant green color, unique taste, and speculative health benefits have caused matcha’s demand to skyrocket. Matcha sales have grown in the US by 86% in the past three years, and Japan continues to export over half of its matcha supply. The demand for high quality matcha has driven cafes to incorporate more matcha products into their menu, contributing to the increased demand, and consequently, its price. According to NBC News, the average cost of a matcha latte has risen from $5.84 to $6.15 per cup in just the past year.
Prices might continue to rise simply because of the demand. “I feel like more stores are adding matcha so the demand is making it more expensive,” says Ada Qiu, a senior who drinks matcha multiple times a week and regularly purchases matcha powder.
Another factor of the matcha’s price increase is due to its inherently limited supply. High quality matcha is naturally an expensive and limited product due to its traditional method of production that dates back to the 16th century. High quality matcha is a seasonal crop harvested once every spring. The tea plant requires at least five years to mature before it’s handpicked and slowly milled into a powder. This meticulous process was originally intended to produce extremely high quality tea in small amounts.
Matcha only accounts for 6% of Japan’s total tea production, and the aging tea farmers are retiring. To make matters worse, harvests are shrinking as heat from climate change increases. In the future, tencha, another Japanese tea, may see more growth as a crop, or like in China, matcha production is increasing to address the demand. However, these efforts will take years to materialize, and may not produce the same high quality of matcha that’s found in Japan.
In the meantime, to remedy the shortage of ceremonial grade matcha, consumers may want to consider switching to culinary grade matcha for purposes like lattes and baking. In an article addressing the matcha shortage, Sugimoto Tea Company from Japan states that “[Ceremonial Matcha] can be fully appreciated using only water . . . [culinary-grade matcha] has a stronger, more robust flavor profile that holds its own when combined with sugar [and] milk.” Although culinary grade matcha may not provide the same vibrant green color that’s perfect for posting on social media, it’s a much more affordable and suitable type of matcha for satisfying that sweet tooth. So, next time you’re shopping for matcha, consider a less expensive one that’s not labeled as ceremonial grade–if the hype around ceremonial grade matcha lessens, we may see prices go down.
