With its rich nutritional profile and vibrant green hue that is perfect for sharing on social media, matcha is gaining popularity among young people, causing matcha prices to surge.

According to the Global Japan Tea Association on September 27, the price of tencha (the raw material for matcha) traded at an auction in Kyoto, Japan, reached a record high of 8,235 yen per kilogram (approximately 77,500 won) as of last May. This is about 1.7 times higher than the previous year, far surpassing the previous record of 4,862 yen (about 45,800 won) set in 2016.

Matcha with its green hue is gaining popularity among young people, causing matcha prices to surge.

The price of tencha (matcha raw material) traded at an auction in Kyoto, Japan, reached a record high of 8,235 yen per kilogram (approximately 77,500 won) as of May. This is about 1.7 times higher than the previous year.

Food and beverage analyst Julia Mills explained, "Matcha is attractive to health-conscious consumers because it contains antioxidants as well as L-theanine, which has a calming effect."

Matcha is a powdered tea made by finely grinding young tea leaves grown in the shade, characterized by its deep color and rich aroma. It is used not only in beverages but also in a variety of foods such as bread and ice cream. In particular, matcha is known to be rich in antioxidants like catechins, which are believed to support cardiovascular health.

The sharp rise in matcha prices is due to a surge in global demand, while supply has decreased because of poor harvests in Japan, the main exporting country. Structural issues such as the aging farming population and worsening climate conditions in Japan are further exacerbating the supply shortage.

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The matcha craze among young people is expanding the global matcha market. Market research firm Research and Markets forecasts that the global matcha market will grow from $3.84 billion last year to $4.24 billion (5.9 trillion won) this year. By 2029, it is expected to reach $6.48 billion (9.0272 trillion won).

Although matcha has traditionally been enjoyed as a tea in Asia, the market is now growing rapidly in Western countries such as the United States and the United Kingdom.

According to market research firm NielsenIQ, retail sales of matcha in the United States have increased by 86% compared to three years ago. On Instagram, there are as many as 9.52 million posts related to '#matcha,' reflecting its huge popularity. The United States currently accounts for about 22% of the global matcha market.

Aaron Vick, who oversees purchasing at the U.S. tea importing company G.S. Haly, told the Associated Press, "This fall, we purchased premium Japanese matcha for the U.S. market at prices 75% higher than last year," adding, "Prices for mid- and lower-grade matcha are also expected to rise by about 30-50%." He noted, "Chinese matcha is generally cheaper than Japanese matcha, but prices continue to rise due to soaring demand. It will be a challenging time for matcha enthusiasts."

In the United Kingdom, sales of matcha beverages in June and July of this year increased by 114% compared to the same period last year. Market research firm Grand View Research identified the UK as the fastest-growing matcha market in Europe, reporting that the number of specialty shops selling matcha beverages has tripled in the past year to 1,096 locations. Lisa Harris, founder of the food consulting firm Harris and Hayes, told the Financial Times, "Drinking matcha lattes symbolizes 'conscious consumption' that values health and trends," adding, "For Generation Alpha, matcha will become as commonplace as sushi."

Why are young people so enthusiastic about matcha?

Mills explained, "The traditional method of pouring powder and hot water into a small bowl and whisking it creates a special appeal for consumers who want to savor the drink slowly."

Why are young people so enthusiastic about matcha?

Julia Mills, a food and beverage analyst at market research firm Mintel, explained, "Matcha will not disappear from consumers' choices anytime soon," adding that matcha is attractive to health-conscious consumers because it contains antioxidants as well as L-theanine, which has a calming effect.

Mills also noted, "Millennials & Gen Z are more likely than other generations to have tried matcha," and added, "The traditional method of pouring powder and hot water into a small bowl and whisking it creates a special appeal for consumers who want to savor the drink slowly."

Domestic cafes and convenience store chains are also expanding their matcha menu offerings, joining the global matcha craze.

Starbucks Korea announced that sales of 'Jeju Matcha Latte' and 'Jeju Matcha Cream Frappuccino' in the first half of this year increased by more than 30% compared to the same period last year. Twosome Place launched three 'Twosome Matcha' beverages (Iced Matcha, Matcha Cream Latte, Strawberry Matcha Latte) in July, and sold over 500,000 cups within two weeks of launch.

Convenience store chains are introducing desserts that either combine matcha with existing popular products or feature matcha as the main ingredient. In early September, Yonsei Dairy, in collaboration with CU, launched four new 'matcha desserts': Matcha Chocolate Fresh Cream Bread, Matcha Cream Castella, Matcha Chocolate Mammoth, and Matcha Cream Roll Cake.