T4IS2026 Strategy Dialogue: 'The Global Matcha Boom is Disrupting and Destroying Japanese Tea' — The Paradox of Bankruptcy Amidst the Boom

Points of this release: - Japanese tea farmers have decreased from approximately 202,000 (1985) to approximately 12,000 (2020) — about 94% disappeared in a generation. Production has dropped from a peak of about 100,000 tons to approximately 75,000 tons recently, with the industry consolidating into a few large-scale farms. - Green tea exports doubled between 2024 and 2025, with the government's target of '150 billion yen by 2030' reached almost 5 years early. However, Japan's green tea exports (approx. 400-500 million USD) remain a fraction of the estimated 4 billion USD global matcha market. - Amidst the boom, bankruptcies and business closures in the Japanese tea industry are at their highest level in decades. The matcha boom arrived too fast for companies burdened with debt from structural reform of the long-declining domestic leaf tea market — a paradox of being profitable on paper but facing cash flow crises. - Matcha requires Tencha, and converting existing Sencha factory equipment costs approximately 100 million yen for small-scale facilities. Some production areas, viewing the boom as a bubble, intentionally refuse to convert. - Powdered tea that is not Tencha is beginning to flow downstream as 'matcha.' Concerns have been raised that the volume of 'matcha powder' exported may exceed actual Tencha production.

Session Overview: Socia Co., Ltd. (Headquarters: Chuo-ku, Tokyo; Representative Director: Sera Yun) held a private session, 'Strategy Dialogue,' at the invitation-only executive summit 'Tech for Impact Summit 2026' (https://tech4impactsummit.com/ja) held at Kioi Conference, Tokyo Garden Terrace Kioicho on Sunday, April 26, 2026. This release summarizes the discussion of one of the sessions: 'The Global Matcha Boom is Disrupting and Destroying Japanese Tea,' hosted by the Japanese tea marketplace 'Yunomi Life.'

This session consisted of a presentation by Yunomi Life on the current state of the Japanese tea industry and an open Q&A involving operators, investors, and policymakers. As it was conducted under the Chatham House Rule, this release records the themes and points discussed and does not attribute statements of participants other than the host, Yunomi Life, to specific individuals or organizations.

Centered on 'People-to-People Commerce'—a business model that returns value to the small-scale farmers, tea factories, and artisans who form the core of the Japanese tea industry—the discussion focused on what the global matcha boom created by social media is currently bringing to the foundations of the culture of Japanese tea.

Highlights of the Discussion: 1. Structure of the Japanese Tea Industry — About 94% of Farmers Disappeared in a Generation The session first presented the structural image of the Japanese tea industry. According to national statistics, tea farmers have decreased from approximately 202,000 (1985) to approximately 12,000 (2020). It is calculated that about 94% of farmers were lost in a generation. Production volume decreased from approximately 100,000 tons at the peak to approximately 75,000 tons in the most recent reporting year. The industry has consolidated, with fewer and larger farms producing the same total volume of tea leaves.

The scale comparison was striking. Even the largest tea farm in Kagoshima has about 60 employees. Indian tea plantations generally have a scale of 5,000 to 50,000 people, and the scale per Japanese farm is an extreme outlier on the small side in the world. The supply chain has a multi-stage, fragmented structure, connecting farmers to factories (fresh leaves to raw tea), wholesalers (finishing processing), and buyers.

2. Matcha Boom — What Happened by the Numbers The scale of the matcha boom was shown with specific figures. The composition ratio of the host's handling flipped in just one year. In 2024, it was about two-thirds leaf tea and one-third matcha. In 2025, it was about two-thirds matcha and one-third leaf tea.

Green tea exports doubled from 2024 to 2025. This means that the government's target of '150 billion yen by 2030' was achieved almost 5 years early. However, Japan's green tea exports of approximately 400-500 million USD are only a small fraction of the estimated 4 billion USD global matcha market. Japan is capturing only a small percentage of the value of the boom created by its own products. Domestic matcha production in Japan has increased by about 3 times in the last 10 years. Wholesale prices are expected to be about twice as high as in 2024 last year, and are expected to be about twice as high again this year, and the wholesale price at the leaf level...