As matcha sweeps global markets, other parts of Japan’s tea industry are disappearing

At 2 a.m., workers begin handpicking leaves across the tea fields of Noboru Endo’s family farm in Shizuoka Prefecture, Japan. Thousands of the most tender sprouts on Camellia sinensis shrubs are plucked carefully beneath black sheets. By midday, the 20 workers’ straw baskets are bursting with gyokuro, jade-green leaves that make up one of the country’s finest teas. 

But Endo’s gyokuro will not make him rich. Gyokuro — shade-grown and later steeped in lukewarm water to coax out its famously sweet and umami flavors — is among Japan’s most labor-intensive teas to cultivate. But its price per kilogram dropped by more than 50% in 2024 compared to 2014, according to the Japanese agriculture ministry, signaling a drop in demand. 

At the same time, matcha, its more popular cousin, has exploded worldwide. It is also made from the Camellia sinensis species and submerged in darkness for much of its life. But where gyokuro is rolled into thin leaves, matcha is ground into a fine powder before being shipped globally for mass consumption in drinks and desserts. 

“Matcha is valued twice as much as gyokuro,” Endo said in Japanese at the end of the spring harvest in June, noting the number of gyokuro farms in Shizuoka has decreased tenfold compared to several decades ago. Others similarly estimate the number of gyokuro farmers decreased from 100 in the 1980s to just a handful now. 

As the global matcha market races toward an estimated $10.7 billion valuation by 2035, Japanese farmers, tea merchants and cultural practitioners are grappling with the unexpected consequences of its success. While demand for matcha has fueled record-high investment and exports, production of other tea varieties — including sencha, the most commonly consumed tea in Japan — has declined. 

Atop his hilly farm spread across the banks of the Asahina River, Endo pointed out three former gyokuro farms that now specialize in tencha, the processed C. sinensis leaf used for matcha.

The global reinvention of matcha

For centuries, tea in Japan was part of a carefully performed, hourslong ritual guided by Zen principles of harmony, respect, purity and tranquility. While tea was introduced to Japan as early as the ninth century, the foundations of the modern Japanese tea ceremony were laid centuries later, when Zen monks reintroduced and popularized powdered tea. Tea ceremony culture emerged and its protocols were “frozen in time once it got to Japan,” becoming the basis of a long-standing national tradition, according to Michelle Liu Carriger, a tea ceremony practitioner and professor at the University of California, Los Angeles. 

Following centuries of traditional consumption, matcha broke free of the tea ceremony and entered the global food industry in the 20th century. There is no single explanation for matcha’s meteoric rise. But its vivid green color, perceived health benefits and versatility in foods and drinks poised it to become a phenomenon.  

In 1986, Häagen-Dazs introduced green tea as an ice cream flavor, which used matcha powder. Starbucks started selling matcha lattes in the mid-2000s. 

“In Japan, the production of matcha expanded from a couple of hundred tons [a year] to over 1,000 tons after Starbucks,” said Ian Chun, the CEO of Yunomi.life, a major supplier of artisanal Japanese tea. 

Between 2005 and 2024, production of tencha, the leaf used to make matcha, more than quadrupled, eventually exceeding 5,000 tons annually. Matcha was increasingly incorporated into commercial products, from hamburgers and instant ramen to toothpaste. 

Today, matcha is a relatively unpopular beverage within Japan, while sencha remains the beverage most people reach for every day: In a 2025 survey of over 1,000 people in Japan by market research firm Cross Marketing, roughly 70% of respondents said sencha was their preferred tea, while matcha ranked last among nine major tea varieties. 

The matcha boom abroad, however, has shown little sign of slowing. According to data from the Japanese agriculture ministry, matcha and powdered teas accounted for nearly 70% of green tea exports in fiscal 2025. Meanwhile, production of other tea varieties, including gyokuro, has continued to fall.

‘A big disappearance of tea companies’

Faced with shrinking domestic production of sencha, policymakers have increasingly viewed tencha — and matcha products — as a pathway to keeping tea farming economically viable.

In Shizuoka, one of Japan’s top-producing tea regions, officials have begun encouraging a shift toward tencha. In 2024, the prefecture launched an initiative to help sencha growers sell part of their harvest to tencha-processing facilities. Shizuoka government officials did not respond to multiple requests for comment. 

Other regions have adopted similar strategies. In Tokyo, officials allocated 20 million yen, about $126,000, to subsidize shading equipment and other production costs, aiming to reduce financial barriers for farmers looking to enter the matcha market. In Shiga Prefecture, a government survey found that tencha cultivation increased by roughly 70% during harvest season in 2025 compared to the previous year. 

The shift is creating new tensions within Japan’s domestic tea market. 

Marc Falzon, the founder of Ooika, the largest matcha refinery in America, said the supply of high-grade matcha has increasingly gone to overseas markets. This leaves Japanese companies struggling to get access to high-quality matcha, Falzon said.  

Others are concerned about what the matcha boom means for sencha. 

“Sencha is our most important daily beverage,” said Mika Hasegawa, who leads tea farm tours and conducts tea-brewing workshops in Kyoto, in Japanese. “If there’s less sencha and more matcha, that means less tea for daily life and more matcha for overseas consumers. I hope we can keep sencha, but I’m really worried.”

For farmers unable to ride the wave of matcha mania, the alternative is often to sink. A decline in lesser-known tea varieties, alongside a fast-aging farmer population, has contributed to a fall in the number of tea farms. Japan lost nearly three-quarters of its commercial tea farms in 20 years, from 53,687 in 2000 to just 12,325 in 2020. 

“You have a lot of tea leaf producers — as well as tea leaf sellers — who are going bankrupt and disappearing, closing shop, ending their businesses,” Chun, the Yunomi.life CEO, said. 

“So there’s a big disappearance of tea companies in Japan, unless they are able to tap into the global matcha export market,” Chun said.  

‘Not enough to make a living’

As matcha grows mightier in the global economy, some in the industry worry Japanese tea will survive only as an export commodity. In that case, Chun said, tea would become “a caricature” of “a Japanese culture that doesn’t actually exist anymore.” 

“It would be sad for tea to become consumable, tourist culture,” Chun added.  

The future of the broader tea industry remains unclear. Alongside disappearing tea varieties, farms and traditions, production volume and harvesting area are in decline across Japan. Today, Endo is one of just seven gyokuro farmers in Shizuoka, according to the Japan National Tourism Organization.

“The youngest one is 46 years old, and the rest are in their 70s and 80s,” he said. “I’ve been doing (gyokuro) for 50 years now — my grandfather started it, and I’m the third generation. Right now, there are no successors.” 

For the farmers who remain, Endo noted that “everyone’s switched to tencha,” the leaf used to make matcha, because it has become significantly more profitable than gyokuro or other tea varieties. Tencha rose 6.2% in price per kilogram over the past decade. 

Other gyokuro farmers in the area have turned to growing local vegetables alongside gyokuro to financially sustain themselves, according to Endo. 

In the matcha boom, he said, “growing gyokuro alone is not enough to make a living.”