Japan's Matcha Export Boom Drives Japanese Tea Prices Up

Why the Japan Matcha Export Boom Is Reshaping Domestic Tea Prices

The global matcha boom has pushed producers in Kyoto and other Japanese tea regions to expand output of tencha, the shaded leaf that is ground into matcha. Exports of Japanese tea have risen, but tea destined for the domestic market has become scarce, and the everyday teas Japanese households drink — sencha and hojicha — have climbed sharply in price. That imbalance sits directly behind the tighter allocations and firmer quotes many buyers of wholesale matcha from Japan are now seeing.

These points come from an interview by the Kyoto Shimbun with Hideki Kuwahara, president of the Uji tea wholesaler Kuwahara Zensuke Shoten in Uji City, Kyoto Prefecture, and an author of books on tea.

What a Kyoto Tea Wholesaler Is Seeing on the Ground

Kuwahara describes a chain reaction rather than a single cause. Influencers on social media featured tea shops in Uji, and foreign tourists flooded in looking for matcha. At the same time, his own firm and other tea wholesalers received a steady stream of calls and emails from domestic and overseas businesses offering to buy at high prices.

The second half of the chain is the part many overseas buyers miss. Because farmers shifted acreage toward tencha, production of other tea categories fell. Large beverage makers that fill bottled tea products then had to bid aggressively to secure volume. The result, in Kuwahara's words, is that from 2025 the price of all tea categories surged — not only matcha.

Hojicha Prices Quadrupled in Two Years

The clearest number in the interview concerns hojicha, roasted green tea that has been consumed in Japan since the Meiji era and was once roasted at home. Raw material prices for hojicha have risen fourfold in two years. In the Kansai region, hojicha sold for roughly ¥250–300 per 100 grams until about two years ago (approx. USD 1.70–2.05 at recent exchange rates); Kuwahara warns that a future price of ¥1,000 per 100 grams (approx. USD 6.80) is not far off, turning an everyday drink into a luxury item.

Demand-side pressure is compounding this. Hojicha powder for lattes is a product his company handles, and while hojicha costs less than matcha, a hojicha latte sells at a price comparable to a matcha latte. That margin structure is why so many businesses want hojicha, and why the category is no longer the low-cost fallback it used to be.

An Exporter's Read on Sourcing and Inventory Planning

From our position handling matcha wholesale from Japan to overseas cafes and importers, the Kyoto account matches what we encounter in day-to-day negotiation. The practical implication for buyers is this: treat hojicha and sencha as part of your matcha risk, not as separate line items. When roasting-grade and sencha material compete for the same shrinking non-tencha supply, a café menu built on both matcha lattes and hojicha lattes faces cost pressure on two fronts at once, and the hojicha side is currently the faster-moving one.

A second practical point concerns quality verification. Kuwahara notes that in the current environment — which he calls bubble-like — some tea carries a price above what its quality justifies. For a buyer, that means a higher unit price this season does not automatically indicate a better lot. Insist on tasting samples from the specific lot you are quoted, ask which harvest and which region the material came from, and compare usucha (thin matcha, whisked to a light, drinkable consistency) preparation against your existing benchmark rather than relying on grade labels alone. Ceremonial grade matcha (the finest stone-milled tencha, intended for drinking rather than cooking) is exactly where this discipline pays off, because the term is used loosely across the market.

Structural Risks Behind Japanese Matcha Supply

Several longer-term factors raised in the interview deserve attention from anyone building a multi-year sourcing plan:

Farmer attrition: In Shizuoka, a famous sencha-producing region, farms that could not shift to tencha production have reportedly closed in growing numbers, with an aging workforce compounding the problem.

Chinese competition: Kuwahara assesses that Chinese quality is improving but Japan still holds an advantage, while conceding Japan cannot win on volume or price and must compete on quality.

Imitation products: Japan's Ministry of Agriculture, Forestry and Fisheries has registered "Japanese tea" under the Geographical Indication (GI) protection system as a countermeasure against imitation goods from China and elsewhere, though he says how effective it will be is not yet clear.

Policy direction: The ministry has also set out a policy of expanding green tea exports, even as imports of inexpensive Chinese and Vietnamese tea rise.

Kuwahara's concern is cultural as well as commercial: that domestic tea keeps flowing overseas, prices stay elevated, and Japanese consumers end up drinking mainly cheap imported tea — eroding the culture of Japanese people drinking Japanese tea. He asks that national policy be framed around protecting Japanese tea, not export volume alone.

What US Cafés and Importers Should Do This Season

The single most actionable takeaway is to lock in volumes earlier and in writing. If pricing across every Japanese tea category began climbing in 2025 and hojicha material has already quadrupled, a spot-buying approach exposes your menu costs to whichever category tightens next. Within the industry there is also a view that the current run-up has bubble characteristics, so committing your entire annual budget at today's peak carries its own risk; a staged commitment — securing your core ceremonial matcha requirement while keeping flexibility on secondary items — is a reasonable middle path. Document the grade, origin and harvest of each lot you buy now, so that when the market normalizes you have a quality baseline to negotiate against rather than a price memory alone.