Kagoshima Tencha Prices Double Amid Global Matcha Boom | Japan Matcha Market News

Kagoshima Tencha Auction Prices Nearly Double as Global Matcha Demand Surges

Japan's matcha supply chain is under significant pressure. On May 14, 2026, a tencha auction was held in Kagoshima City, Kagoshima Prefecture — Japan's largest tencha-producing region — where the average trading price reached approximately ¥19,095 per kilogram (roughly $122 USD/kg at ¥157/USD), nearly double the price recorded at the same event last year. The highest bid reached ¥47,100/kg (approximately $300 USD/kg). Industry insiders are putting it plainly: "There simply isn't enough tea."

What Is Tencha?

Tencha (碾茶) is the specially cultivated and processed raw leaf that is stone-ground to produce matcha powder. Unlike other Japanese green teas, tencha leaves are shade-grown before harvest and dried without rolling, preserving their bright green color, umami flavor, and high L-theanine content. The quality and origin of tencha directly determines the grade and flavor profile of the final matcha product.

Kagoshima: Japan's #1 Tencha Region

Kagoshima Prefecture has ranked as Japan's top tencha-producing region since fiscal year 2020, accounting for approximately 40% of national production. Production in the prefecture reached 2,150 metric tons in fiscal year 2024 — roughly four times the output recorded just six years ago. The May 14 auction featured entries from 14 growing districts across the prefecture, including Minamikyushu City and Kirishima City, with buyers evaluating lots by color, aroma, and texture on the auction floor.

Prices Surge as Demand Outpaces Supply

The auction results underscore a supply-demand imbalance that is now rippling across Japan's entire tea industry. One bidder at the auction noted: "Prices have been rising steadily over the past two to three years. It's not just tencha — there isn't enough sencha or bottled tea either. Everything keeps going up." The combination of rising global health consciousness, the worldwide popularity of Japanese cuisine, and the explosive growth of matcha-based beverages in cafés and foodservice has created demand that Japanese tea farmers are racing to meet.

What This Means for US Matcha Importers

For café owners, restaurant operators, and procurement managers sourcing Japanese matcha in the United States, this market shift has direct implications:

• Wholesale prices are rising. With raw tencha auction prices doubling year-over-year, upstream cost increases will continue to flow through to finished matcha powder pricing at all grades.
• Supply availability may tighten. Even as production expands and new processing facilities come online, demand is currently outpacing supply growth.
• Locking in supplier relationships matters. The Kagoshima Tea Industry Council has announced an additional tencha auction planned for July 2026, reflecting efforts to increase trading frequency — but competition among buyers remains intense.
• Quality benchmarks are improving. Auction participants noted that overall tencha quality has "leveled up" compared to two to three years ago, reflecting investment in cultivation and processing standards.

Industry Response and Outlook

Toru Mitsumura, Managing Director of the Kagoshima Prefecture Tea Industry Council, stated at the auction: "Kagoshima has developed a wide variety of tea types. We intend to continue promoting tencha production and expanding its distribution channels." New producers and newly commissioned processing plants are entering the market, riding the global matcha wave. The council's decision to schedule a second auction in July 2026 — rather than waiting for the traditional annual cycle — signals the urgency of matching supply with global demand.

For US businesses that depend on a steady supply of high-quality Japanese matcha, staying closely connected to the Japanese supply chain — and working with established wholesale partners who have direct relationships with Kagoshima producers — has never been more important.

Source:
MBC Minaminihon Broadcasting / Yahoo! News Japan (May 14, 2026)
https://news.yahoo.co.jp/articles/bb6d1cef413c06385171325e3f96ed15ae8b00d6