Interested in matcha? Don't miss Noli Ergas' session at World Tea Expo, "Much Ado About Matcha." Plus, keep an eye out for Part 2 of this series!
With "matcha mania," blitzing café culture in the West, the resulting global shortage of the bright green powdered tea may well bely the quiet and contemplative nature of its origins.
For some eight hundred years, matcha tea has been at the center of Japanese Tea Ceremony, which is a meditative practice involving deliberate and precise movements, concluded by the mindful whisking of powdered green tea in hot water by a tea master in a Zen-like state of contemplation. Known as an artform, the ceremony expresses what’s inside the soul and a certain mode of Zen, which at its core is meant to unify the souls of its participants.
Contrast this with dumping a few grams of green powder from a can into warm water, giving it a vigorous stir, and downing it like a shot – fuel for work or college classes – and one can well understand why Japanese tea purists tilt their heads at Americans and smirk watching them knock back matcha like an espresso or tequila shooter. Ironically, most Japanese tea drinkers don’t even prefer matcha as their daily tea beverage.
Indeed, in April, 2025, the firm, Cross Marketing Inc. released the results of a survey they conducted on 1,100 Japanese consumers aged 20 to 69 on their tea imbibing habits. The results demonstrate that ‘matcha mania’ is not for Japanese tea purists. The overwhelming number of respondents, around 70% percent, preferred steamed green tea (or Sencha) to anything else. This was followed by Mugicha or roasted barley tea, with Hojicha – a roasted green tea – coming in third. Matcha, was left languishing at the bottom of the list with just 9% of respondents reporting it to be their tea of choice.
One legendary Japanese purist is Zenichi Sugimoto, patriarch of the Sugimoto Tea company who has passed on his tea traditions over three generations. His grandson, Kyohei, noticing a gap in the Japanese tea market while on a trip to the USA in 2005, saw an opportunity to branch out, establishing a subsidiary in Seattle where the population had long been open to hot beverages, it being the original location of Starbucks.
So, almost thirteen years ago, when Noli Ergas, an American science grad approached the young company called Sugimoto USA, he knew little about tea but had been living in Japan for around two and a half years. It was culture rather than product that attracted him to Sugimoto USA. (Note: Ergas is now director of Product for Two Leaves and a Bud.)
At the time, the company’s focus was on Sencha and other Japanese greens. Matcha wasn’t even on the radar. During his job interview, US founder, Kyohei Sugimoto asked him what teas he liked. Ergas replied with a preference for Earl Grey. “But I said, for Japanese tea, my favorite is matcha,” Ergas recalls.
“And he [Sugimoto] chuckled a little and said, well, ‘that's not gonna [sic.] help us too much. That's less than 1% of our sales!’” smiles Ergas.
Neither could have known then that within a decade, Ergas’ favored tea would be their strongest product – and soon afterwards, they’d be struggling to meet demand.
Indeed, Ergas is somewhat astonished at the steep demand curve. “I mean, the Japanese tea industry as a whole was in decline,” he says.
“Matcha tea was historically consumed by elites. And then with the Meiji Restoration [reestablishment of imperial rule] with Japan opening up to the West and Westernizing, matcha consumption in Japan really just fell off through time,” Ergas says.
Consumed in increasing quantities since the 18th century, by the 20th century, Sencha had by far become the most popular green tea consumed by the population.
“The most common consumption of matcha [during the more traditional period] was with largely women who were studying the tea ceremony…. because they wanted to be these well-rounded, cultured, prospective brides.” Ergas says. As was typical at the time of not only Japan but also other Asian societies, being versed in culture enhanced the suitability of a prospective bride for an economically well-off groom.
“But, in modern society, [with] women entering the workforce and not having a family being, you know, their, like, main motivator, or at least earlier in life…you have many, many, many fewer people studying tea ceremony in Japan. Thus, the matcha market, and matcha production, you know, was going down,” Ergas explains.
“And now… now, it's like, all of a sudden, the rest of the world has discovered this magical drink that is matcha, and everybody wants it, and…yeah, Japan is just not able to produce enough.”
David Lavecchia, one of the three co-founders of the Japanese tea retailer, Tezumi Tea (tezumi means “hand-picked” signifying their emphasis on sourcing high quality teas) is familiar with sudden surges in matcha demand over the years.
Lavecchia counts three over the past half century. The first was known as the ‘Häagen-Dazs boom’ in the mid-90s. “That's when Haagen-Dazs signed the contract to buy matcha for their matcha ice cream for the first time,” Lavecchia says. “It’s the closest Japan came to this shortage.” Ironically, the matcha flavor was rejected by the company in the mid to late ‘80s but the persistence of the Japanese branch of the company prevailed a decade later, and it became a monumental success.
“And that brought the previous record for price increases, like, 125%,” says Lavecchia.
“So up until this point, all… almost all matcha made in Japan was hand-picked for, like, higher-grade consumption, because the primary consumer base were tea ceremony practitioners, temples, shrines,” says Lavechhia. This prompted producers to make mechanically plucked lower quality varieties aimed at being used as culinary additive. These became known as ‘culinary grade’ teas.
“The Haagen-Dazs contract basically solidified the fact that the culinary sector was going to be a huge growing sector of the matcha industry,” says Lavecchia. Recipes included matcha in baked goods from cookies and cakes through the taste spectrum to matcha hummus and matcha butter.
“Then, compounding that was the 2006 ‘Starbucks Shock,’ as they called it then; that's when Starbucks started selling the matcha latte,” says Lavecchia. And so, the second matcha boom ensued.
For Welsh travel blogger and tea enthusiast Amy Aed, and founder of Eissa Tea Company (named for the Zen monk who brought matcha to Japan) the third boom and recent shortage began less than two years ago.
“It really became noticeable around late 2023,” she says, adding: “It’s hard to pinpoint an exact moment, but that’s when we started seeing real difficulty in securing stock.”
Lavecchia says that matcha producers really started to panic when centuries old matcha producers, Marukyu Koyamaen and Ippodo Tea ran out of their reserves of dried unground leaf called Tencha, which was kept on hand in case of sudden surges typified by the past matcha booms. Tencha is routinely frozen and stored by the large producers preserving it for years to be ground on demand. These large producers believed they had stocked sufficient matcha precursor to meet any demand spike. In 2024, their calculations proved to be utterly deficient.
“When they [Marukyu Koyamaen and Ippodo Tea] ran out of their backup supply of tea, that made the whole industry sort of panic,” Lavecchia emphasizes, elaborating: “Because if some of the biggest players in the market have ran [sic.] out of tea, that's… that's an unprecedented, occurrence.”
This set the stage for what happened in May of 2025. There was no tea left over from 2024, and the current year’s harvest, though high in quality, was low in yield due to frost followed by hot and dry conditions. Meanwhile, demand was only increasing. According to Lavecchia, these factors caused price increases of between 150-300 per cent at the auction in Kyoto where farmers put their Tencha on the market.
Tezumi works with smaller farms bypassing the auction system by dealing directly with the farmers, “so they [small farms] didn't get quite the attention, and so they didn't feel the effects until a few months afterwards,” Lavecchia says. “As people were struggling to find new places to buy matcha from.”
Emily Morrison, co-founder and managing partner of The Steeping Room, an online specialty tea retailer based in Austin Texas says this nearly caused a free-for-all in the sector: “It is very fierce competition right now just to be able to procure matcha (and this is true all around - for blenders, consumers, retailers, etc.),” she says.
The matcha shortage is complicated by the shared supply chain that has long been established, the pressure on which caused a domino effect on the supply chain as Lavecchia explains:
“The smaller producers… they'll borrow equipment from the larger producers. So, if you're a small tea company, buying a lot of matcha mills is an expensive investment, and so… If a larger company isn't using them all the time, because they don't need to be, they will rent out the space and the machines to smaller companies, and this sort of shared system was working up until the big companies needed to use the machines all of the time – to be grinding all the time!”
“And so that led to a rush on the stone mills that matcha's ground with. As people wanted to get their own grinders to grind their own matcha, the orders for stone mills shot up, and the stone cutters, who now have a surge in orders, couldn't keep up. So, the surge kept being pushed down the supply chain,” Lavecchia says.
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