Increase in matcha prices due to widespread global demand for the renowned powdered tea.
In the world of tea, one variety has been gaining popularity among the younger generations - matcha. However, recent developments in the market have left suppliers and tea enthusiasts pondering its future.
Josh Mordecai, supply chain director for Good & Proper Tea, has been approached daily by Chinese matcha suppliers, as the demand for this green powder continues to rise. Yet, Mordecai expects to raise prices due to increased costs, a concern shared by David Lau, owner of Asha Tea House. Lau recently increased the price of his matcha latte by 50 cents to offset the increased costs.
Mordecai wonders if consumers will switch to other tea varieties like hojicha if matcha prices continue to rise. Millennials and Generation Z customers, who are more likely to have tried matcha than others, might find themselves reconsidering their matcha habits.
But not everyone is concerned. Julia Mills, a food and drink analyst for Mintel, expects social media interest in matcha to die down but believes it will remain on menus. She attributes this to matcha's appeal to customers interested in wellness due to its antioxidants and l-theanine.
Companies like Starbucks in the USA use Matcha for their drinks, such as the "Matcha Crème Frappuccino." Traditionally sourced from Japan, matcha is also produced in China, competing with Japan. Some companies like Ito En have subsidiaries in the USA and China that produce or distribute Matcha-based products.
The traditional way of preparing matcha, whisking the powder together with hot water, appeals to drinkers who want to slow down and be more intentional. As the tea industry navigates these challenges, it remains to be seen how consumers will respond and whether the popularity of matcha will endure.
In an effort to keep customers drinking matcha while limiting price increases, Lau is looking into alternate suppliers from China and elsewhere. As the industry adapts, it's clear that matcha's unique blend of flavour and health benefits continue to captivate tea lovers worldwide.
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