The Matcha Supply Chain Is Shifting: What Buyers Need to Know in 2026

The world consumes approximately 12,000 tonnes of matcha every year. Japan, the country most associated with matcha culture, produces only 4,000 to 5,000 tonnes annually.

That leaves a gap of 7,000 to 8,000 tonnes that must come from somewhere else.

For decades, this gap was quietly filled by Chinese tea producers. But in 2024 and 2025, a series of events turned this quiet arrangement into an urgent supply chain conversation.

What happened to Japanese tencha production?

Tencha is the shade-grown tea leaf that gets stone-ground into matcha powder. Japan’s premium tencha regions — particularly Uji in Kyoto — experienced consecutive heat waves in 2024 and 2025 that reduced production by approximately 40%.

The impact on pricing was immediate and severe:

• Kyoto tencha wholesale prices rose 69% to 160% depending on grade — 1.7 to 2.6 times the previous season’s level
• Auction prices reached 1.7 to 5.5 times their previous year levels
• Japanese tea buyers began actively exploring alternative sourcing regions

For food service companies, retail brands, and F&B manufacturers that depend on matcha as an ingredient, this price shock created real procurement challenges.

Where does the rest of the world’s matcha come from?

China is the world’s largest tea exporter, with green tea accounting for 86.6% of total tea exports. Three Chinese provinces have emerged as significant matcha and tencha production regions:

Guizhou (Tongren): Home to one of the world’s largest tencha production facilities, with annual capacity exceeding 2,200 tonnes. Guizhou is already the largest China-to-Japan tencha exporter, with ISO 22000 and AIB certified partner facilities.

Sichuan (Mengding Mountain): At 800 to 1,500 meters elevation, Sichuan’s expanding tencha production benefits from climate conditions similar to Japan’s premium growing regions. The province’s Zhu Ye Qing and Meng Ding Gan Lu teas are already well-regarded in specialty markets.

Yunnan: Known for its unique large-leaf cultivars grown at 1,200 to 2,000 meters elevation. While traditionally associated with Pu-erh tea, Yunnan’s terroir is being rediscovered by matcha buyers seeking distinctive flavor profiles.

How does Chinese matcha compare in quality?

This is the question most buyers ask first. The data is clearer than many expect.

In independent blind tasting assessments, Chinese matcha has been rated equal to Japanese matcha in flavor quality. The primary difference is price: Chinese matcha-grade tencha typically costs 30% to 50% less than equivalent Japanese grades.

The quality spectrum is wide in both countries. Industrial-grade matcha (used in food manufacturing) starts at $15 to $35 per kilogram FOB. Foodservice grade ranges from $35 to $80. Ceremonial grade — the highest quality — ranges from $80 to $150 per kilogram.

What about food safety and compliance?

For buyers importing into Japan, compliance with the Japan Positive List is non-negotiable. This regulatory framework covers over 800 controlled substances, and a single violation means the entire shipment is rejected.

Reputable Chinese tea exporters conduct pre-shipment testing through accredited laboratories such as SGS Japan, Intertek, and Japan Food Research Laboratories. A standard test panel covers 266 pesticides, with particular attention to four critical substances:

• Fipronil (limit: 0.002 ppm)
• Indoxacarb (limit: 0.01 ppm)
• Triazophos (limit: 0.01 ppm)
• Endosulfan (limit: 0.01 ppm)

Every compliant batch ships with a Certificate of Analysis, Pesticide Test Report, Origin Certificate, and Phytosanitary Certificate. Lot-level traceability — from specific garden to processing batch to export shipment — is standard practice among established exporters.

The market outlook

The global matcha market is valued at approximately $4 billion in 2025, with a projected compound annual growth rate of 10.6%. Demand drivers commonly cited for matcha include health-positioned consumption, food service applications, and plant-based product formulation.

With Japanese domestic production unlikely to recover quickly — tencha cultivation requires years of investment in shade-growing infrastructure — the supply gap will persist through at least 2027.

For procurement professionals, the practical implication is straightforward: diversifying matcha sourcing to include qualified Chinese suppliers is no longer optional. It is a supply chain necessity.

What to look for in a Chinese matcha supplier

When evaluating Chinese matcha suppliers, buyers should verify:

1. Compliance documentation: Full Japan Positive List testing capability with accredited lab reports
2. Traceability: Lot-level tracking from garden to export
3. Certifications: ISO 22000 or equivalent food safety management systems
4. Production capacity: Ability to fulfill consistent volumes
5. Quality grading: Clear differentiation between industrial, foodservice, and ceremonial grades

Buyers who review their sourcing options before a supply squeeze have more room to negotiate than buyers who start afterwards.

Is the matcha shortage getting better or worse in 2026?

Both, depending on which number is tracked. Kyoto Prefecture’s newest official harvest data, surveyed as of December 2025, show growers actively converting other tea gardens to tencha — area up 20.7% year-on-year — and tencha volume held up far better than sencha or kabusecha. But tencha’s crop value more than doubled, so buyers should not expect near-term relief on price.

According to Kyoto Prefecture’s official tea statistics, tencha-dedicated garden area reached 717.1 hectares in the 2025 survey, up from 594.0 hectares a year earlier, while tencha crop value rose to roughly ¥14.09 billion from ¥6.29 billion — a signal that growers are converting other tea gardens to tencha rather than replanting sencha or kabusecha. Nationally, the picture is still tightening: MAFF’s 2025 first-flush survey recorded a 10% year-on-year fall in crude tea production across Japan’s major producing prefectures, on an 11% drop in raw leaf harvest, published in August 2025. New tencha ground typically needs several years before it reaches full yield, so the acreage shift shows where supply is heading without closing the near-term gap.

Which regions produce which grade of tencha and matcha?

Region signals growing conditions and program, not a guaranteed grade — the same district can produce both ceremonial-lean, competition-grade lots and everyday foodservice tencha, depending on shading length, flush timing and how the leaf is picked and sorted. The table below maps the regions named in this article to the grade band buyers most commonly source from each.

Terra Vista Co., Ltd. sources tea from five Chinese provinces with full Japan Positive List compliance and lot-level traceability. For sample requests and quotations, contact info@terravista.co.jp.

Frequently Asked Questions

Why is matcha so expensive in 2026?

Japanese tencha production dropped approximately 40% in 2024-2025 due to heat waves, and Kyoto tencha wholesale prices rose 69-160% depending on grade — 1.7 to 2.6 times the previous season. The global supply gap of 7,000-8,000 tonnes annually is pushing prices higher across all grades.

Can Chinese matcha match Japanese quality?

In independent blind tasting assessments, Chinese matcha has been rated equal to Japanese matcha in flavor quality. Chinese matcha typically costs 30-50% less than equivalent Japanese grades while meeting the same safety standards when properly tested.

What is the Japan Positive List for tea imports?

Japan’s Positive List covers over 800 controlled substances in agricultural imports. Tea imports must pass a 266-pesticide test panel through accredited laboratories. A single violation results in the entire shipment being rejected at customs.

What’s the difference between tencha and matcha?

Tencha is the shade-grown tea leaf, steamed and dried flat without rolling; matcha is the fine powder produced when tencha is stone-ground. The two are separate product and pricing categories, and buyers should specify which one they are sourcing when requesting a quote.

Is Japan planting more tencha to fix the shortage?

Yes, in at least one major producing prefecture. Kyoto Prefecture’s official 2025 tea statistics show tencha-dedicated garden area up 20.7% year-on-year to 717.1 hectares, even as area planted to sencha and kabusecha fell. New tencha plantings take several years to reach full yield, so this points to easier supply later rather than an immediate fix.

How much did Japan’s tea harvest fall in 2025?

Across Japan’s major tea-producing prefectures, MAFF’s 2025 first-flush survey recorded crude tea production of 20,000 tonnes, down 10% from the previous year, on an 11% drop in raw leaf harvest and a 5% drop in area under cultivation. The survey was released in August 2025.

Where can buyers check Japan’s official tea production data directly?

MAFF publishes tea cultivation area, raw leaf harvest and crude tea production statistics on its tea data pages, updated each harvest season; Kyoto Prefecture publishes its own more detailed prefecture-level breakdown by tea type. Both are public and update at least once a year.

Related Terra Vista service: our Supply Chain & Sourcing practice → — verified corridors for tea, agriculture, raw materials and industrial goods.