China produced over 12,000 tonnes of matcha in 2025, accounting for nearly 70 percent of global output, with the industry posting an average annual compound growth rate of 28.67 percent over the past nearly five years, according to the newly released 2026 China Matcha Industry Development Report.

Industry insiders said the surge in orders for Chinese-made matcha worldwide is no coincidence, but the result of demand, supply and cultural storytelling converging at the right moment.

Traditional tea-growing regions across China are racing to reinvent themselves. Wuyi county in Jinhua, east China's Zhejiang Province, long known for premium traditional teas, is among those leading the shift.

"Traditional premium teas are labor-intensive to produce, output is limited, and the market is nearing saturation," said Zhou Xiaofen, head of the county's tea technology service station.

However, as consumers increasingly seek out processed and diversified tea drinks, tea producers have new opportunities to move up the value chain.

At Zhejiang Xiangyu Tea Co., Ltd., eight tencha (the raw material for matcha) production lines run continuously. Fresh leaves are processed through 12 steps — including steaming, drying and precision grinding — into fine matcha powder shipped worldwide.

The company began matcha production in 2019 and has since mastered core processing techniques for producing high-quality matcha.

Zhejiang has developed four major matcha production areas, namely Hangzhou, Shaoxing, Jinhua and Ningbo, with the province turning out 8,851 tonnes last year worth 1.1 billion yuan ($162.48 million).

In the first quarter of this year alone, Zhejiang exported 1,242 tonnes of matcha valued at 140 million yuan, up 7.3 times year on year.

Tongren in southwest China's Guizhou Province is another core matcha-producing region. Its high altitude, low latitude, abundant fog and limited sunlight combine to create ideal conditions for tea cultivation.

"By late April, we had already produced and sold 1,100 tonnes of matcha, with production orders stretching into the second half of the year," said Meng Zude, chairman and general manager of Gui Tea Group, a leading tea company.

Tongren matcha is primarily used in the international food industry and the premium tea beverage market, with partnerships established with more than 300 leading new-style tea beverage companies at home and abroad.

The city's full-year output of matcha reached 2,500 tonnes in 2025, with exports of 1,300 tonnes — up threefold year on year, ranking first nationally and second globally. In the first quarter of this year, the city's matcha export volume rose by more than 40 percent year on year, with destinations expanding to 54 countries and regions.

Wang Qing, president of the China Tea Marketing Association, described matcha as a core area for extending and upgrading China's tea industry chain, and a key lever for developing new quality productive forces in agriculture and modernizing the tea industry.

The transition from low-end contract manufacturing to becoming a premium global supplier of matcha has required significant investment in technology and standards.

Quality matcha requires a particle fineness of 800 to 1,000 mesh, less than one-tenth the size of milk powder particles, Meng said. To meet that standard, Gui Tea Group has expanded its intelligent grinding lines to 10, achieving a fineness of 1,200 to 1,300 mesh. A newly built 5,000-tonne cold-storage facility further supports ingredient preservation.

"We set up a dedicated matcha research institute, joining hands with the Tea Research Institute of the Chinese Academy of Agricultural Sciences, Jiangnan University and other institutions to tackle key technical challenges, build shared R&D platforms, and continuously refine tea cultivars and processing techniques," said Meng. "We have filed more than 40 patent applications to date."

Tongren matcha has passed more than 500 EU pesticide residue tests.

A robust standards framework has also proven indispensable. In recent years, Zhejiang has rolled out multiple technical standards covering tea garden management and matcha processing.

Various group standards for matcha were released at the 2026 Matcha Conference in Tongren in late May.

As China seeks to further expand overseas, cultivating demand for premium matcha products and raising consumer awareness remain key challenges. A potential breakthrough lies in better showcasing the cultural value behind matcha products and enhancing the cultural appeal of Chinese matcha.

Jingshan town in Hangzhou's Yuhang district offers a compelling case. Home to the famed Jingshan tea that dates back to the Tang Dynasty (618-907), the town is recognized as the birthplace of "diancha," or tea-whisking, a way of preparing tea that dates back to the Song Dynasty (960-1279), and the origin of Japan's matcha tradition.

"Traditional tea processing techniques and associated social practices in China" were added to UNESCO's Representative List of the Intangible Cultural Heritage of Humanity in 2022, of which the Jingshan Tea Ceremony is an important part. Thanks to this, Yuhang's matcha exports grew by more than 70 percent in 2025.

Using matcha as a draw, places across China are deepening the integration of tea culture and tourism, building diverse experiences for domestic and international visitors.

Tongren, for example, is tapping its historical and cultural resources to preserve the intangible heritage of Song-style tea whisking, with plans underway to develop a matcha industrial park, a matcha town and dedicated matcha districts.

During the 15th Five-Year Plan period (2026-2030), Guizhou aims to embed matcha into 10,000 consumption touchpoints and achieve a combined output value of 10 billion yuan.