The matcha market is expected to witness exponential growth by 2027 primarily driven by surging product demand in key regions across the globe. Moreover, rising awareness regarding the health benefits of matcha is anticipated to further fuel market expansion through the forecast period.

Matcha is a nutritious food ingredient that has recently gained popularity due to various advantages associated with its consumption. It is known to be rich in several phenolic compounds and bioactive substances like catechins and tannins. These catechins offer many bioactive effects, such as neuroprotective and renal effects, antidiabetic effects, and liver injury inhibitory effects, among others, which has bolster product demand.

Notably, Japanese matcha is a type of powdered green tea that is grown in the traditional way. Regular consumption of matcha tea has been found to positively effect both the mental and physical health owing to its potential for protecting against several diseases and supporting cognitive function, which has aided business growth in recent years.

Matcha green tea powder is known to contain key ingredients that provide numerous benefits for strengthening cognitive functions of elderly people. To that effect, a November 2020 study published in Nutrients suggested that daily intake of matcha green tea powder has demonstrated preventive effects against cognitive decline in community-dwelling elderly women. As a result, the expanding geriatric population has been favorable for product penetration.

Furthermore, industry players have been deploying strategic initiatives to extend their consumer reach in leading marketplaces, thereby fostering industry outlook. For instance, Ito En, a major green tea supplier, inked a partnership agreement with Taiyo International, a key company engaged in the research and manufacturing of functional food ingredients, to make its way into the food, beverage, and supplement sectors in North America. With the partnership, the two companies added novel clinical research to enable additional structure and function claims.

For comprehensive assessment, the matcha market has been categorized on the basis of production technology, grade, application, and region. In terms of grade, the market has been segregated into classic, ceremonial, and culinary. The culinary grade segment is anticipated to grow at over 7.5% CAGR through the analysis period to reach a sizable valuation by the end of 2027.

From the application perspective, the matcha market has been segmented into matcha beverages, regular tea, personal care & cosmetics, and food. In 2020, the matcha beverages application segment held a substantial market share in terms of revenue and is calculated to expand at a CAGR of approximately 8% over the estimated timeline.

On the regional front, the LATAM matcha market is estimated to see robust growth by 2027, progressing at a CAGR of around 6% through the study timeframe. Meanwhile, the MEA matcha market accounts for a considerable portion of the overall industry revenue and is projected to grow at about 7% CAGR over the forecast period.