Japan Tea Market

Japan Tea Market Overview:

Japan tea market size is projected to exhibit a growth rate (CAGR) of 8.30% during 2024-2032. The growing health consciousness among the masses, rich cultural heritage of tea ceremonies in Japan, and the rising popularity of flavorful, fresh, and ready-to-drink (RTD) beverages are some of the factors impelling the market growth.

Japan Tea Market Analysis:

• Major Market Drivers: The market is experiencing strong growth because of the traditional tea culture in Japan, combined with innovations in tea flavors and packaging.
• Key Market Trends: Consumer preference for natural and premium products is causing a clear move towards organic and specialty teas. In addition, the increasing appeal of ready-to-drink (RTD) tea beverages to consumers looking for convenience is providing a positive market outlook.
• Competitive Landscape: The Japan's tea market is extremely competitive, with large companies and numerous small producers competing for customer loyalty. The rise in international brand recognition has intensified competition in the premium and specialty tea markets.
• Challenges and Opportunities: Challenges involve the changing prices of raw materials and the requirement for sustainable production methods. Nonetheless, there are opportunities in the rising demand for organic teas and the possibility of increasing exports of tea, especially to health-conscious international markets.

Japan Tea Market Trends:

Health Awareness and Wellness Trends

The increasing awareness about health among people is impelling the market growth. The antioxidants, vitamins, and minerals in green tea are well-known for supporting overall health. The trend of healthier way of living is causing a decrease in the consumption of sugary beverages, with tea becoming more popular as a favored choice. Furthermore, the increasing focus on managing weight and maintaining metabolic health, especially among the younger demographic, is enhancing the appeal of tea. This increased interest is because of the health advantages of different teas, including matcha, which contain antioxidants, like catechins, that improve heart health and fight cancer, attracting health-focused buyers. The World Health Organization (WHO) estimates that in 2022 there were around 20 million new cases of cancer and 9.7 million deaths from the disease. Furthermore, 1 in 5 people will be diagnosed with cancer, and studies indicate that 1 in 9 males and 1 in 12 women will pass away from the illness.

Collaborations with International Brands

Collaborations between international firms and Japanese tea companies allow exchange of information, market expansion, and product innovation. Through these partnerships, regional tea businesses can reach new clientele and make use of worldwide shipping networks, increasing their profile internationally. These partnerships also allow for the development of new products designed for international preferences, thereby increasing market attractiveness. The recent partnership between ITOEN, Ltd. and Los Angeles Dodgers' Shohei Ohtani, which was completed on April 30, 2024, for their green tea brand Oi Ocha, serves as an example of this. By partnering with a well-known athlete, this collaboration raises awareness of the brand and emphasizes the benefits of Japanese tea for both culture and health.

Sustainability and Ethical Sourcing

Sustainability and ethical sourcing play a vital role in shaping the Japan tea industry. Consumers are increasingly aware about environmental issues and are looking for products that have a minimal impact on the environment. Tea companies are implementing sustainable farming practices like organic cultivation and reducing pesticide use. This appeals to eco-conscious consumers and enhances the quality of the tea. Furthermore, consumers who value social responsibility resonate with ethical sourcing practices such as fair-trade certifications and guaranteeing fair wages for tea farmers. These methods improve brand image and customer loyalty, appealing to a market segment that prioritizes sustainability and ethical manufacturing. In September 2022, Numi Organic Tea launched a new line of Roasted Japanese Green Tea, featuring umami and yuzu lemon flavors from Japan, offering health benefits like reduced caffeine content and higher antioxidants. The company offered environmentally conscious customers organic teas that were Fair Trade Certified, packaged in compostable materials, and labeled with their carbon footprint. The growing demand for sustainable and ethical products is encouraging companies to develop innovative solutions and invest in eco-friendly manufacturing methods, ultimately supporting market growth.

Japan Tea Market Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the market, along with forecasts at the country and regional levels for 2024-2032. Our report has categorized the market based on product type, packaging, application, and distribution channel.

Breakup by Product Type:

• Green Tea
• Black Tea
• Oolong Tea
• Others
   

The report has provided a detailed breakup and analysis of the market based on the product type. This includes green tea, black tea, oolong tea, and others.

Green tea dominates the market because of its notable cultural significance and established health benefits. Health-conscious individuals prefer green tea because of its antioxidants, which have been associated with reduced risks of heart disease and cancer. The category is identified by a range of products such as matcha, sencha, and gyokuro. In 2023, the market for matcha tea was valued at US$ 3.2 billion, as per the IMARC Group. Producers are constantly coming up with new ideas in this area, supplying a range of options from classic loose leaves to practical ready-to-drink (RTD) and powdered varieties. The increasing popularity of green tea sourced sustainably and organically highlights the growing favor for environment-friendly products.

Black tea is gaining traction, particularly among younger demographics and in city settings. This section meets the increasing demand for Western tea culture and the popularity of flavored and mixed teas like Earl Grey and English Breakfast. Black tea is known for its strong taste and increased caffeine level, which makes it a favored option for a morning or afternoon pick-me-up. Furthermore, black tea is available in loose-leaf and bagged options to accommodate various consumer preferences.

Oolong tea has a distinct taste and numerous health advantages, like enhancing metabolism, making it appealing to health-conscious people. Oolong tea has established a special place in the market in Japan for those who appreciate tea and want to try something different from the usual green and black teas. This section is known for its high-quality branding and is often promoted as a luxurious or distinctive item, commonly savored in upscale dining establishments or bought as a luxury gift.

Breakup by Packaging:

• Plastic Containers
• Loose Tea
• Paper Boards
• Aluminium Tin
• Tea Bags
• Others
   

A detailed breakup and analysis of the market based on the packaging have also been provided in the report. This includes plastic containers, loose tea, paper boards, aluminium tin, tea bags, and others.

Plastic containers are preferred for packaging because of their convenience and durability. They are commonly used for both ready-made tea beverages and loose-leaf choices. They assist in preserving the flavor and quality of the tea, as well as offering ease in transport and storage. Nevertheless, consumers are becoming increasingly informed about the environmental effects of plastic, prompting manufacturers to explore recyclable or biodegradable plastics in order to meet sustainability objectives.

Loose tea is popular among traditional consumers who enjoy having control over the strength and flavor of their brew. This method of packaging tea enables the tea leaves to expand fully and allows for ideal water circulation, leading to the extraction of maximum flavor. Loose tea is commonly available in large quantities or in premium, resealable packaging to preserve its freshness and aroma over long periods. This section is designed for experts and is often linked with boutique tea stores and upscale supermarket sections.

Paper board packaging is mainly used for tea bags and small amounts of loose tea. This kind of packaging is preferred because it is lightweight and easy to recycle, matching with the values of environmentally conscious individuals. Paper boards are often designed with attractive, culturally relevant artwork, making them popular for gifting purposes. Advancements in barrier technologies are enhancing the protective features of paper boards, leading to improved preservation of tea freshness and quality.

Breakup by Application:

• Residential
• Commercial
   

The report has provided a detailed breakup and analysis of the market based on the application. This includes residential and commercial.

Residential comprises individuals who buy tea for their personal use at home. This section offers a variety of items made to cater to different preferences and brewing needs of households. The main goal is to offer quality, variety, and accessibility through a range of options, including loose leaf teas, tea bags, and specialty blends. Producers focus on this demographic by marketing products in supermarkets, online platforms, and specialty stores, providing packaging options tailored for both single individuals and families.

Commercial consists of tea items supplied to establishments like restaurants, hotels, cafes, and offices. This portion requires bigger packaging sizes and frequently emphasizes the need for consistency and efficiency to meet the demands of busy service settings. Business purchasers seek tea options that can satisfy a wide range of customers, encompassing both in-demand local flavors like green tea and international varieties. The IMARC Group states that the size of the green tea market in Japan is anticipated to expand at a compound annual growth rate (CAGR) of 7.29% from 2024 to 2032. Tea providers in this market frequently offer extra services, such as personalized dispensers, large-quantity brewing choices, and tailor-made mixtures, to boost their appeal to corporate clients. The business sector is also more prone to price changes and supply chain improvements because they buy larger quantities.

Breakup by Distribution Channel:

• Supermarkets/Hypermarkets
• Specialty Stores
• Convenience Stores
• Online
• Others
   

A detailed breakup and analysis of the market based on the distribution channel have also been provided in the report. This includes supermarkets/hypermarkets, specialty stores, convenience stores, online, and others.

Supermarkets and hypermarkets play a major role in the market by providing a wide variety of tea products in one convenient location. These large retail companies are chosen for their convenience and capacity to offer competitive prices due to their economies of scale. They serve a wide range of individuals by carrying a variety of products, including affordable generic brands and high-end specialty teas. The spacious aisles and generous shelf space make it possible to effectively showcase and promote new tea products, making them an important location for launching products and engaging with buyers.

Specialty stores concentrate on offering a carefully chosen range of premium teas, frequently including unique and scarce types that may be found outside of mainstream stores. These stores appeal to tea enthusiasts and individuals looking for a personalized shopping experience, often offering professional advice on choosing tea and brewing methods. Specialty stores in Japan may provide cultural tea experiences, such as tastings or tea ceremony demonstrations, to enhance consumer engagement and loyalty through cultural enrichment.

Convenience stores play a crucial role in the tea market due to their easy access and strategic placement. These stores are designed for busy individuals seeking fast and convenient tea-buying choices. The emphasis in this station is on pre-made teas and individual packets, catering to the busy lifestyle of numerous city residents. These stores frequently react quickly to changes in user preferences by regularly updating their selection with new and inventive tea products.

Online platforms provide a wide selection of tea products, ranging from common essentials to high-end and specialized brands. They offer buyers the opportunity to compare prices, view reviews, and browse a broader selection of products than what is usually found in brick-and-mortar stores. Online platforms are commonly used by retailers to provide subscription services or special offers for rare or imported teas, making e-commerce a popular choice for such products. The Japan e-commerce market is projected to exhibit a growth rate (CAGR) of 8.8% between 2024 and 2032, according to the IMARC Group.

Breakup by Region:

• Kanto Region
• Kansai/Kinki Region
• Central/ Chubu Region
• Kyushu-Okinawa Region
• Tohoku Region
• Chugoku Region
• Hokkaido Region
• Shikoku Region
   

The report has also provided a comprehensive analysis of all the major markets in the country, which include Kanto Region, Kansai/Kinki Region, Central/ Chubu Region, Kyushu-Okinawa Region, Tohoku Region, Chugoku Region, Hokkaido Region, and Shikoku Region.

The Kanto Region, including Tokyo and nearby areas, makes up a considerable share of the market because of its dense population and strong economic growth. The area showcases a wide-ranging tea market with a significant representation of both traditional and contemporary tea offerings. Consumer preferences in urban areas frequently lead to advancements in the variety and packaging of teas, with a significant market for both convenient, pre-made teas and high-quality, handcrafted options. The strong distribution network in this area facilitates various sales channels, spanning from major retail stores to specialized tea shops.

The Kansai or Kinki Region, known for cities like Kyoto and Osaka, is famous for its historical connection to Japanese tea culture, especially in the Uji area known for its top-notch green tea. In November 2023, Hojicha Co. partnered with Marukyu Koyamaen to provide authentic Uji matcha through its online store, in response to customer requests for reputable matcha brands. This partnership led to the introduction of Matcha Isuzu, Matcha Yugen, and Matcha Kinrin, serving a range of tastes from matcha lattes to traditional tea ceremonies. This area focuses on classic tea offerings like matcha and sencha and supports a lively market for tea ceremony paraphernalia. The tea market is impacted by both local and foreign tourists buying tea as a cultural souvenir or present.

The warm climate in the Kyushu-Okinawa Region is advantageous for the tea market, particularly for growing specific teas like Kamairicha from Kyushu. The tea sector in the area combines conventional methods with inventive techniques in the processing and infusion of tea. Furthermore, Okinawa provides unique herbal teas such as mugwort, which play a vital role in local health and wellness customs.

Competitive Landscape:

• The market research report has also provided a comprehensive analysis of the competitive landscape in the market.
• Main players are actively partnering with both local and global companies to broaden their range of products and market coverage. These partnerships frequently strive to combine traditional Japanese tea flavors with contemporary, worldwide tastes, developing creative products that attract a varied range of consumers. In November 2023, Hojicha Co. revealed a partnership with Marukyu Koyamaen, bringing genuine Uji, Kyoto-made matcha to its internet store. This new addition was created to provide premium matcha choices for both home and cafe settings, meeting the needs of customers seeking genuine Japanese tea. Additionally, they are focusing on multiple strategic tactics to remain competitive and fulfill changing consumer preferences. This involves adding different new flavors and health-focused tea options to product lines, improving packaging designs to attract younger consumers, and prioritizing sustainability in sourcing and production methods. Furthermore, these businesses are increasingly using digital marketing and e-commerce platforms to connect with a wider audience.

Japan Tea Market News:

• January 2022: Asahi Soft Drinks Co., Ltd. launched a new brand, Japanese Black Tea Unsweetened Straight, using domestic tea leaves to meet growing consumer interest in quality ingredients. The company aimed to sell 2 million cases annually in 500 ml PET bottles for easy consumption.
• October 2021: Hojicha Co. launched hojichapowder.com, an online shop for Hojicha Powder in the USA, offering fast 2-day shipping from distribution centers on both coasts. This new service aimed to provide a convenient shopping experience and meet the growing demand for genuine Japanese roasted green tea.
• March 2023: Tenzo, a premium matcha tea company, collaborated with boutique tequila brand Lo Siento to create three exclusive matcha-infused cocktails. This partnership demonstrated their mutual dedication to quality and innovation.

Japan Tea Market Report Scope:

Key Questions Answered in This Report:

• How has the Japan tea market performed so far, and how will it perform in the coming years?
• What has been the impact of COVID-19 on the Japanese tea market?
• What is the breakup of the market on the basis of product type?
• What is the breakup of the market on the basis of packaging?
• What is the breakup of the market on the basis of application?
• What is the breakup of the market on the basis of distribution channel?
• What are the various stages in the value chain of the market?
• What are the key driving factors and challenges in the market?
• What is the structure of the market, and who are the key players?
• What is the degree of competition in the Japan tea market?

Key Benefits for Stakeholders:

• IMARC’s industry report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, Japan tea market forecasts, and dynamics of the market from 2018-2032.
• The research report provides the latest information on the market drivers, challenges, and opportunities in the Japan tea market.
• The study maps the leading, as well as the fastest-growing, markets. It further enables stakeholders to identify the key country-level markets within the region.
• Porter's five forces analysis assists stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the Japan tea industry and its attractiveness.
• The competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.