(Singapore, 2026.05.12) China’s matcha boom is entering a new phase in 2026, as this finely ground, shade-grown green tea powder—now going viral in Chinese cafés, featured in nationwide themed festivals, and increasingly rolled out in supermarkets—shifts from a niche ingredient into mainstream consumption.
The rapid rise of matcha raises a central question: can the industry move beyond fast-moving hype into a phase of consolidation and brand-building, and ultimately develop the strength to challenge Japan’s long-standing dominance in the global market?
Japanese matcha still rules consumer perception, while Chinese origins such as Guizhou, Zhejiang, and Hubei have yet to become trusted premium icons. As one column in Chinese business media outlet 36Kr noted, this reflects a broad gap between industrial production capacity and consumer branding power.
One of the most visible signs of the trend’s viral momentum came from Matcha Wang, a specialty store in Shanghai. Its “Little Sheep Matcha” (小羊抹茶)—topped with a hand-drawn sheep floating on milk foam—went viral online within just a month of its debut early this year.
Around the same period, matcha festivals began appearing across China, with Chengdu, Shenzhen, Shanghai, and Wuhan all hosting their editions. Major retailers also moved in: Walmart rolled out dozens of seasonal matcha products, from cornflakes to spreads, while Hema (盒马), China’s supermarket chain, saw matcha bakery sales surge 300% within a month of introduction.
What was once a niche ingredient long associated in consumers’ minds with “Japanese matcha” is now entering China’s mainstream food landscape. As noted by the column Red Meal Supply Chain Guide (红餐供应链指南), matcha is being scaled for mass consumption, bringing its upstream supply chain into public attention.
Matcha is no longer confined to beverages—it is now being spread, baked, dipped, and embedded in snacks. As it enters home consumption, it moves beyond instant foodservice into higher-frequency, repeat-purchase scenarios, the report pointed out.
Two F&B trend-focused influencer platforms —Yinzhi Meng (饮之梦) and Shanghai Wendao (上海文道)—have already positioned themselves in this space. Both are known for identifying culturally resonant, pre-mainstream ingredients and transforming them into visually distinctive, social media–friendly products, often first launched in premium retail districts before being amplified online.
Their simultaneous bet on matcha reflects a shared assessment: consumer awareness and demand are already in place, but a strong, unified brand symbol is still missing. Whether in supermarket expansion or specialty cafés, the core constraint remains the same—can matcha be supplied consistently and at scale?
Unlike many flavour powders, matcha is hard to make: its colour, fineness, bitterness, aroma, and stability all directly affect product quality. It is less forgiving than seasonal fruit ingredients, which can rely more on scarcity and storytelling for premium pricing.
This means healthy growth depends heavily on upstream capabilities: whether production can scale without quality loss, whether pricing can remain stable or move upmarket, and whether the supply chain can support diversities.
According to China’s national definition, matcha is produced from shade-grown tea leaves that are steamed or heat-fixed, dried, and then ultra-finely ground. Two steps are critical: shading tea plants for 20–30 days before harvest to boost chlorophyll and amino acid content to reduce bitterness and removing stems and coarse fibres before grinding them into powder.
So-called “1000-mesh matcha” (千目抹茶) refers to particles finer than 5–13 microns. The higher the mesh number, the finer the powder and the smoother the mouthfeel. High-grade matcha typically falls in the 800–1000 mesh range, where particles are nearly imperceptible to the naked eye and feel almost silk-like.
This production process creates a high barrier to entry, making premium matcha significantly more complex and costly than ordinary flavour powders. For decades, Japan—especially Uji (宇治)—has defined the global premium benchmark.
However, global supply conditions are shifting. Reuters reported that Japan’s matcha production has been affected by heat stress, with Kyoto harvests under pressure and some farmers estimating declines of around 25%. At the same time, surging global demand has pushed prices sharply higher, with Kyoto’s May 2025 tencha (碾茶) auction price reaching 8,235 yen (about S$72.15) per kg, up 170% year-on-year. Expanding tea plantations in Japan also takes time—often around five years to mature—limiting near-term supply flexibility.
This widening supply gap has opened a window for China’s matcha industry. Tencha is a rare, shade-grown Japanese green tea best known to be the raw ingredient to make matcha.
Over the past 30 years, Zhejiang has become China’s largest matcha-producing region, accounting for nearly half of national output. In 2025, production is expected to exceed 8,800 tons, with total provincial output surpassing 1.1 billion yuan (about S$205 million) in value.
Guizhou is another key hub. By the end of last year, Tongren (铜仁) had built 76 standardized tencha production lines and five matcha refining lines, with annual processing capacity exceeding 4,000 tons. In 2018, Guicha Group (贵茶集团) established what is described as the world’s largest single matcha production facility, supplying global clients including Starbucks, Japanese firms, Haidilao, and ChaBaiDao (茶百道). It also exports massively to Europe and the US.
A third emerging hub is Hubei’s Xiaogan (孝感), which is more B2B-oriented, supplying brands such as Sexy Tea (茶颜悦色), Bawang Chaji (霸王茶姬), and Starbucks. In early 2026, two leading firms there exported 13.9 tons of matcha powder worth 5 million yuan—several times the value of ordinary tea exports.
Together, these regions represent different strategies: Zhejiang focuses on early branding and consumer-facing products; Guizhou prioritises scale and export capability; and Hubei specialises in agile B2B supply chains.
Yet all three face a shared constraint: upstream expansion is outpacing downstream brand development. China produced an estimated 12,000 tons of matcha in 2025, making it both the world’s largest producer and consumer. But volume alone does not equate to premium positioning.
The key question is no longer whether China can produce matcha—but whether it can produce matcha that is consistent, recognisable, and emotionally resonant for consumers.
Even with China’s growing global role, consumer recognition remains limited. As one industry observer noted, it is still unclear whether consumers would actively choose “Guizhou matcha,” “Jingshan (径山) matcha” in Zhejiang, or “Hubei matcha”.
Research cited by Red Meal suggests that only about 15% of consumers in major Chinese cities recognise Guizhou’s “Fanjing (梵净) matcha,” compared with over 50% recognition for Japanese Uji matcha.
Price data reinforces the same point: high-quality Jiangkou (江口, Guizhou) matcha sells at about 800 yuan per kg ex-factory, while premium Japanese Uji matcha can reach 3,000–5,000 yuan per kg at retail. This suggests China has supply capability but limited premium pricing power.
The second challenge lies in downstream product innovation. Beverage use of matcha requires solubility and flavour balance; baking requires heat and colour stability; retail products require shelf life, packaging integrity, and consistent replication.
Some failures have already emerged. A “Triple Cheese Thick Matcha” product sold at Luckin reportedly faced issues with the foam solidifying or developing an undesirable texture, leading to its removal. Industry discussions pointed to problems in ingredient formulation, mixing parameters, and cooling control.
This highlights a growing bottleneck: application capability. Making a matcha latte is relatively straightforward; producing a stable matcha brownie or spread is significantly more complex.
At present, much of China’s upstream industry still focuses on raw powder production, while deeper processing is often outsourced to cities such as Guangzhou or Guiyang. This increases costs and slows response. While plantation expansion and factory upgrades can scale relatively quickly, brand-building, product development, and consumer education require far longer cycles.
Japan spent decades turning Uji into a global premium symbol. China, despite its scale advantage, has yet to define its own equivalent identity, Red Meat lamented.
In the long run, the winners are unlikely to be those who rode the earliest wave of attention, but those who can combine stable supply, consistent quality, and repeatable consumer experiences, Red Meat remarked.
If that transition materialises, matcha may evolve beyond a seasonal trend into something more structural: a case study in how China’s tea industry shifts from origin-based production to industrialised food systems—and from traditional consumption to everyday mainstream use, it concluded.
Most of Singapore’s premium matcha is imported from Japan, while smaller volumes also come from China and other producing countries such as Thailand.
