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New matcha retailers emerge in Singapore against backdrop of global shortage

LaksaNews

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SINGAPORE: Online matcha retailer Matsu Matcha launched just two months ago but has faced supply challenges due to the global matcha shortage.

The local brand is one of a handful that have sprung up in the past year, catering to a growing demand for the popular green tea.

Matsu Matcha's founder Bryan Ong launched his store in October this year offering premium matcha powder for sale. The firm imports the powder from Japan.

Speaking to CNA from Ho Chi Minh City, where he was learning about matcha lattes, Mr Ong said some customers subscribed to a six-month plan for their matcha fix, a testament to the popularity of the beverage.

However, a shortage in supply from Mr Ong's usual tea farms in Japan has forced him to seek alternative sources.

Matcha has been around for centuries. The powder is produced from tea leaves grown in dedicated farms across Japan and comes in different types and grades, depending on their quality and use.

Typically, "ceremonial grade" matcha - as it is known in some circles - is considered top grade, produced from leaves picked from the first harvest of the year in early spring. Such matcha is used in traditional Japanese tea ceremonies.

Matcha can also be used in combination with food and drink.

Various grades of matcha are exported to other markets for matcha beverages and for food products.

Known for its umami flavour and what some claim to be health benefits as a "superfood", its popularity has spread beyond Japan, propelled in part by matcha-related content on social media.

According to a report by Japan's Ministry of Agriculture, Forestry and Fisheries, the supply of matcha dropped in 2020, the year the COVID-19 pandemic was declared.

Anticipating lower demand due to the pandemic, tea farmers reduced the production of tea in general.


The supply of matcha has been growing since but has not kept pace with demand due to production constraints, from adverse weather conditions to limited stone mills grinding tea leaves and a shrinking pool of tea farmers, according to the Japanese report and shops in Singapore that CNA spoke to.

Tight supplies have forced some Japanese producers and retailers to restrict customer purchases.

Leading Japan-based producers Marukyu Koyamaen, Ippodo Tea and Ocha no Kanbayashi placed notices on their websites informing customers of supply shortages due to high demand in the past few months.

In Singapore, signs of trouble began as early as late last year, businesses told CNA.

Despite this, numerous small brands have bloomed onto the scene in the last year or so, riding on matcha's soaring popularity.

Established food and beverage outlets have also injected some green into their menu with the introduction of matcha concoctions into their offerings.

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Sara Tan creates matcha-flavoured desserts, such as this Nama chocolate, for her followers and documents the process on YouTube. (Screenshot from video by Buttermilk Pantry)

GLOBAL APPEAL OF MATCHA


In the virtual world, green has invaded food-related content, with more social media accounts centred around matcha reviews or recipes, observed content creator Sara Tan, a Singaporean based in Australia.

Matcha brands have popped up alongside this "boom", said Ms Tan, who produces food content on her Instagram account Buttermilk Pantry and sometimes collaborates with Singapore businesses.

"Where previously it was just a generic tea in the minds of many, a flavour in a dessert or a drink, there is now more of an appreciation of the different levels of quality and flavour profiles," she said.

"Singaporeans are becoming more discerning in what they look for in their matcha and as such there has been an increase in number of cafes and new brands catering to that aspect," the 37-year-old said.

Ms Tan herself has been posting more matcha-related content, including reviews and recipes, at the request of her more than 50,000 followers.

She said the shortage has pushed her to explore brands outside of her usual go-tos.

"I can’t bring myself to fight against bots or the hoards of people coming through automated mailing lists when new stock drops, and as such I have started to explore smaller brands which I now love even more," she said.

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Sara Tan shared her recipe and instructions for Nama chocolate in a video on her YouTube channel, Buttermilk Pantry. The video has received more than 55,000 views.

Another matcha enthusiast, Mr Pei Wei Jie, has been following the launch of local matcha brands in recent months.

The 36-year-old, who details new matcha products on his Instagram account, said that even established F&B outlets like Koi The and Mr Coconut have been pushing matcha items on their menus.

Koi The, which sells bubble tea, recently started selling a matcha tea ceremony set, which includes a tin of powder and a whisk.

New cafes such as Caligraph Coffee and Little Glass Stand offer specialty matcha beverages, Mr Pei added.

He said the availability of more choices here has made matcha more accessible, and prices more competitive.

"However, I wonder how will the taste and quality be like, and if people can differentiate," he said.

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Specialty beverage outlets like Mr Coconut (left), Calligraph Coffee (centre) and Koi The (right) have been pushing out new matcha concoctions. (Photos: Pei Wei Jie)

SHORTAGE FELT BY VETERANS


Those who have been in the business of matcha for years have felt the effects of stronger demand.

Nana's Green Tea, which sells matcha drinks and desserts, experienced a brief shipment delay of matcha powder around May due to production delays in Japan. The Tokyo-based firm has three retail outlets here.

But its director Takahiro Yumisaki said that the delay did not affect stocks at its cafes.

Tea company Matchaya, which has four outlets in Singapore, has been experiencing a shortage for nearly a year, with its matcha supply reduced by about 10 to 20 per cent.

Its general manager Wade Huang said the tea company has had to order in smaller, more frequent batches, leading to higher shipping costs.

Matchaya is exploring partnerships with other tea farms in Japan to secure alternative supplies.

"The limitation of raw ingredients is certainly a significant challenge, especially with the growing global demand for matcha. Beyond this, the matcha business scene also faces the common challenges experienced by other F&B concepts, such as labour shortages and rising rental costs," Mr Huang added.

Another supplier has been more drastically affected.

Tealife, a Singapore-based online retailer which has been around for four years, said that monthly supply has dropped by around 60 per cent, and might slide further.

Its editor-in-chief and community manager Yuki Ishii said signs of trouble started from September, with multiple matcha providers in Japan hiking prices and declining to sell to new distributors.

"This has been a very frustrating time for our customers, as there are no means of purchasing the quality matcha they are looking for anymore. Naturally it has affected our financial state significantly in a negative way as well," he told CNA.

Related:​


NEW BUSINESSES FINDING THIER WAY​


Against the odds, new entrants have tapped into gaps in Singapore's market of matcha drinkers, hoping to establish themselves in the scene.

Among them are co-founders Tiara Hudyana and Wee Shu-Hui, who launched Matcha Masta in October after Ms Hudyana, a nutritionist, observed that many clients who drank coffee experienced some adverse health effects. Many were also lacking protein in their diet.

As a result, the duo formulated a blend that combined matcha with plant-based protein.

"Protein-infused matcha seemed like the perfect solution for people who need their steady dose of caffeine while supplementing protein in their diet," Ms Hudyana told CNA over email.

Matcha Masta's founders said they mitigated their supply risk by sourcing from multiple ceremonial-grade tea farms from Uji, Kyoto.

Another retailer, Mori Matcha, launched in December last year, selling matcha powder, houjicha powder and matcha-making tools online.

Co-founder Maverick Chua said the brand was born from a personal struggle to find "a reasonably-priced, good matcha powder" for consumption.

"From our travels to Japan we know that quality matcha powder does not necessarily have to break a hole in your wallet and we wanted to bridge the gap between quality and affordability in Singapore," Mr Chua said.

Mr Chua said Mori Matcha has still been able to obtain supplies, possibly because it required a smaller volume than other brands. His suppliers have seen higher demand for exports, but it was unlikely their stock would "disappear overnight", said Mr Chua.

It's another story for Matsu Matcha's Mr Ong, who posted an update in end-November informing customers that his stock of matcha powder may dry up in one to two months – earlier than he anticipated.

His three main types of powder are from tea leaves harvested only once a year and stone-milled at a mere 40g per hour.

The demand for high-quality leaves makes it harder to secure stocks, Mr Ong said, adding that he will explore matcha from other sources and ranges.

Mr Ong has since managed to find new sources of matcha from different farms in Japan to ramp up his supply.

"It took me about two to three weeks of relentless communication, reaching out (to farmers) and negotiations," said Mr Ong.

Mr Ong is due to fly to Kyoto at the end of this month to visit a few other tea farms and secure more stock.

Despite the setback, he remains optimistic about the future of the industry, and is persisting towards his eventual goal of holding workshops and starting a home-based cafe. Mr Ong is also gunning towards launching two types of matcha powder for matcha lattes in February.

"I believe that in the next few years, while matcha consumption will be a lot more than currently, the combined effort of the farmers, expansion to more plots of farms, matcha factories increasing their capacity through more manpower and education of matcha brands, will help make matcha business a sustainable and flourishing one," he said.

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