The matcha market has exploded over the past few years, as consumers have become increasingly health-conscious and in search of coffee alternatives.
This influx of demand has opened new opportunities in the market, but as a premium product with limited production, it presents difficulties scaling in a price-sensitive retail environment.
Liam Fahy, founder of Zenergi Matcha, explained the changes this new consumer interest has caused.
“What we've noticed most is a significant increase in matcha-specific cafés opening, as well as a greater presence online in the matcha space,” he said.
However, this growth has also come with drawbacks.
“The caveat is that wider availability doesn't always mean better quality; not everywhere is preparing matcha correctly, and that's something we care about a lot.”
Although Zenergi Matcha focuses on high-quality products like first-harvest matcha, often referred to as ceremonial grade, Fahy acknowledged that there is a wide spectrum of consumers, from the purist who wants to know everything to someone who just knows they feel better drinking matcha than coffee.
He added that consumers value not only quality but also the story behind the tea and were interested in supporting small farmers and learning details such as the growing region, farm, and cultivar.
Reflecting this, Fahy said there were multiple causes for matcha’s growth. An increasing desire among consumers to be more health-conscious and curiosity about where their food comes from were leading drivers, along with the growth of cafe culture, especially on social media platforms such as TikTok, which have accelerated the surge.
At the same time, Fahy highlighted that this rapid increase in demand can lead to scaling issues, which have become a clear challenge for the matcha industry.
“High-quality matcha isn't grown in large quantities and is only harvested once a year. Buying limits tighten, prices inevitably increase, and that then flows through to the customer. When prices go up, some customers unfortunately do step back.”
Despite these limitations, Zenegri Matcha has committed not to compromise on scale, so Fahy was interested to see how the upcoming announcement of pricing for this year's harvest would look.
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