Pandan Tea Market Size & Forecasts 2026-2035, By Segments (Form, Distribution Channel), Growth Opportunities, Innovation Landscape, Regulatory Shifts, Strategic Regional Insights (U.S., Japan, China, South Korea, UK, Germany, France), and Competitive Dynamics (Teasenz, Harney & Sons, The Tea Makers, TWG Tea, Dilmah)

Market Outlook

Pandan Tea Market size is estimated to increase from USD 341.15 million in 2025 to USD 722.99 million by 2035, supported by a CAGR exceeding 7.8% during 2026-2035. In 2026, revenues are forecast to reach USD 364.49 million.

• Base Year Value (2025): USD 341.15 Million
• CAGR (2026-2035): 7.8%
• Forecast Year Value (2035): USD 722.99 Million
• Historical Data Period: 2021-2025
• Largest Region: Asia Pacific
• Forecast Period: 2026-2035

Key Takeaways

• Asia Pacific region secured over 46.4% revenue share in 2025, supported by cultural popularity in Asia.
• Asia Pacific region will expand at more than 8.5% CAGR during the forecast period, attributed to health beverage trends.
• Capturing 63.7% pandan tea market share in 2025, offline segment expanded its dominance, supported by traditional retail channels dominate pandan tea sales.
• The tea bags segment reached 49.5% revenue share in 2025, fueled by convenience and ease of use drive tea bag popularity.
• Key companies dominating the pandan tea market are Teasenz (China), Harney & Sons (USA), The Tea Makers (UK), TWG Tea (Singapore), Dilmah (Sri Lanka), BOH Tea (Malaysia), Basilur Tea (Sri Lanka), Ahmad Tea (UK), T2 (Australia), Celestial Seasonings (USA).

Market Dynamics

Increasing Demand for Pandan Tea as a Specialty and Functional Beverage

The pandan tea market is witnessing a surge in consumer interest, driven by the growing recognition of specialty and functional beverages. As health-conscious consumers increasingly seek natural and wellness-oriented products, pandan tea's unique flavor and potential health benefits, such as antioxidant properties, resonate well with this demographic. According to the Food and Agriculture Organization, the shift towards functional foods is not merely a trend but a fundamental change in consumer preferences, leading to a more significant market share for beverages like pandan tea. This creates strategic opportunities for established brands to innovate and cater to this demand while allowing new entrants to carve out niche markets focused on health and wellness.

Expansion of Ready-to-Drink Pandan Tea and Premium Segments

The pandan tea market is also evolving with the expansion of ready-to-drink (RTD) options and premium product segments. As busy lifestyles drive consumers towards convenience, the RTD format offers an accessible way to enjoy pandan tea without preparation hassle. Companies like Tealive have successfully launched RTD pandan tea products that appeal to younger consumers, reflecting broader trends in convenience and premiumization within the beverage industry. This development opens avenues for both established players to diversify their product lines and new entrants to innovate with unique packaging and flavors, tapping into the premium market that values quality and authenticity.

Development of Fortified and Functional Pandan Tea Variants

The evolution of the pandan tea market is further propelled by the development of fortified and functional variants. With a rising consumer focus on health and nutrition, brands are increasingly infusing pandan tea with additional vitamins, minerals, and herbal ingredients to enhance its health benefits. Research from the International Journal of Food Sciences indicates that fortified beverages are gaining traction, particularly among health-conscious consumers. This trend presents strategic opportunities for established companies to leverage their R&D capabilities and for new entrants to introduce innovative blends that cater to specific health needs, ultimately enriching the pandan tea market and aligning it with evolving consumer preferences.

Growth Driver Assessment Framework
Growth Driver	Impact On CAGR	Regulatory Influence	Geographic Relevance	Adoption Rate	Impact Timeline
Increasing demand for pandan tea as a specialty and functional beverage	2.50%	Short term (≤ 2 yrs)	North America, Europe (spillover: Asia Pacific)	Medium	Fast
Expansion of ready-to-drink pandan tea and premium segments	2.60%	Medium term (2–5 yrs)	Asia Pacific, North America (spillover: Europe)	Low	Moderate
Development of fortified and functional pandan tea variants	2.70%	Long term (5+ yrs)	Europe, Asia Pacific (spillover: North America)	Low	Slow

Industry Restraints:

Regulatory Compliance Challenges

The pandan tea market faces significant regulatory compliance challenges that hinder its growth potential. Stringent food safety standards and labeling requirements imposed by authorities such as the Food and Drug Administration (FDA) in the United States can create operational inefficiencies for producers. These regulations often necessitate extensive testing and documentation, which can be particularly burdensome for smaller producers lacking the resources to navigate complex compliance landscapes. For example, the European Food Safety Authority (EFSA) has set rigorous guidelines for herbal teas, including pandan, that can deter new entrants from investing in the market. As a result, established companies might dominate due to their ability to absorb compliance costs, potentially stifling innovation and diversity in product offerings.

Supply Chain Disruptions

Supply chain disruptions represent another critical restraint impacting the pandan tea market. The reliance on specific geographic regions for sourcing pandan leaves makes the market vulnerable to environmental changes and geopolitical tensions. For instance, the recent supply chain challenges highlighted by the World Trade Organization (WTO) due to the COVID-19 pandemic have led to increased costs and delays in sourcing raw materials. Such disruptions not only affect pricing strategies but also limit the ability of market participants to meet consumer demand consistently. Established companies with robust supply chain networks may weather these challenges better, while new entrants could struggle to establish reliable sourcing channels. Looking ahead, as global trade dynamics continue to evolve, these supply chain vulnerabilities are likely to persist, shaping competitive strategies and market entry decisions.

Regional Forecast

Asia Pacific Market Statistics:

The Asia Pacific region captured over 46.4% of the global pandan tea market in 2025, establishing itself as the largest and fastest-growing segment. This dominance can be attributed to the region's rich cultural popularity of pandan tea, deeply embedded in culinary traditions and health-conscious consumer trends. The increasing demand for natural and herbal beverages, coupled with a shift towards sustainable sourcing practices, has propelled growth in this market. Notably, the Food and Agriculture Organization (FAO) highlights the rising consumer preference for organic products, which aligns with the growing interest in pandan tea as a healthful alternative to conventional beverages. Furthermore, advancements in supply chain logistics and digital transformation have enabled more efficient distribution channels, enhancing market accessibility. As a result, the Asia Pacific region presents significant opportunities for investors and businesses looking to capitalize on the expanding pandan tea market.

Japan is positioned as a pivotal hub in the Asia Pacific pandan tea market, showcasing unique consumer preferences that drive its growth. The country’s appreciation for traditional flavors and natural ingredients has led to an increased demand for pandan tea, particularly among health-conscious consumers. According to the Japan Tea Association, there is a notable shift towards herbal teas, with pandan tea being celebrated for its aroma and versatility in culinary applications. Regulatory support for organic farming practices further enhances the appeal of pandan tea, allowing local producers to meet the rising consumer expectations for quality and sustainability. This cultural alignment with health trends and regulatory frameworks positions Japan as a key player in the regional pandan tea market, reinforcing the broader growth narrative in Asia Pacific.

China anchors the Asia Pacific pandan tea market, driven by its vast consumer base and evolving beverage preferences. The country's increasing focus on health and wellness has spurred a significant surge in demand for herbal teas, with pandan tea emerging as a favored choice among younger consumers seeking natural alternatives. The China National Tea Museum reports a growing trend in the consumption of herbal infusions, emphasizing the cultural shift towards wellness-oriented products. Additionally, the competitive landscape is marked by innovative marketing strategies that highlight the health benefits of pandan tea, appealing to a demographic keen on holistic lifestyles. As China continues to embrace these trends, it solidifies its role in the regional pandan tea market, providing ample opportunities for growth and expansion.

North America Market Analysis:

North America emerged as the fastest-growing region in the pandan tea market, boasting a robust CAGR of 15% driven by rising consumer interest in health and wellness products. This trend is significantly influenced by a growing awareness of the health benefits associated with pandan tea, including its antioxidant properties and potential digestive advantages. As consumers increasingly seek natural and organic beverages, the demand for pandan tea is expected to surge, reflecting a broader shift towards healthier lifestyle choices. Additionally, the North American market benefits from a well-established distribution network, with retailers expanding their product offerings to include specialty teas, thus enhancing accessibility for consumers.

The U.S. plays a pivotal role in the North American pandan tea market, characterized by a burgeoning health-conscious demographic that actively seeks out functional beverages. The increasing popularity of herbal teas, alongside a shift towards plant-based diets, has positioned pandan tea as a desirable option among American consumers. Furthermore, the regulatory environment is becoming more favorable, with the U.S. Food and Drug Administration (FDA) promoting transparency in food labeling, which encourages brands to highlight health benefits. As companies like Harney & Sons Fine Teas expand their product lines to include pandan tea, they are tapping into this growing consumer base, aligning with trends of sustainability and ethical sourcing. This strategic positioning not only enhances market visibility but also meets the evolving preferences of a diverse consumer landscape, ultimately reinforcing North America's leadership in the pandan tea market.

Canada also contributes significantly to the North American pandan tea market, with a notable increase in consumer interest in artisanal and specialty beverages. The Canadian market reflects a strong preference for organic and sustainably sourced products, which aligns well with the characteristics of pandan tea. Retailers such as David's Tea are capitalizing on this trend by offering unique blends that incorporate pandan, thus appealing to health-oriented consumers. Additionally, Canada's multicultural population fosters a diverse palate, leading to an increased demand for exotic flavors, including pandan. This cultural richness not only enhances consumer acceptance but also encourages innovation within the market, providing ample opportunities for brands to differentiate themselves. As Canada continues to embrace health and wellness trends, its role in the North American pandan tea market will likely expand, further solidifying the region's position as a leader in this growing segment.

Europe Market Trends:

The pandan tea market in Europe has maintained a notable presence, characterized by moderate growth driven by increasing consumer interest in herbal and specialty teas. This region's significance stems from a blend of evolving health consciousness and a shift toward natural products, with consumers increasingly prioritizing wellness and sustainability in their purchasing decisions. The European market is witnessing a transformation in spending patterns, as consumers seek out authentic and premium tea experiences, which has fostered a competitive landscape where brands are innovating to meet these demands. For instance, the European Tea Committee has reported a rise in herbal tea consumption, with pandan tea gaining traction among health-conscious consumers. As such, the European region presents substantial opportunities for market players, particularly in product innovation and sustainable sourcing practices.

Germany plays a pivotal role in the European pandan tea market, exhibiting a growing appetite for herbal teas. The country’s cultural inclination towards health and wellness has catalyzed demand for natural beverages, with pandan tea being embraced for its unique flavor and potential health benefits. A recent report by the German Tea Association highlighted a surge in the popularity of specialty teas, with pandan tea being recognized for its aromatic qualities and versatility in beverages. This trend is further supported by an increase in online retail channels, enabling easier access to diverse tea options. Consequently, Germany's position as a key market in the region underscores the potential for growth through targeted marketing strategies and product diversification.

France, similarly, is emerging as a significant player in the pandan tea market, driven by a rich cultural appreciation for tea and evolving consumer preferences. The French market has shown a marked shift towards premium and exotic teas, with pandan tea being increasingly featured in gourmet tea collections. According to a report from the French Association of Tea Producers, the demand for unique and health-oriented beverages is on the rise, with pandan tea appealing to a demographic that values quality and authenticity. This cultural affinity, combined with a growing trend towards sustainable and organic products, positions France as a fertile ground for market expansion. The strategic implication for stakeholders is clear: capitalizing on France's culinary heritage and health trends could unlock significant opportunities in the pandan tea market across Europe.

Regional Market Attractiveness & Strategic Fit Matrix
Parameter	North America	Asia Pacific	Europe	Latin America	MEA
Innovation Hub	Nascent	Developing	Nascent	Developing	Developing
Cost-Sensitive Region	High	Medium	High	Medium	Medium
Regulatory Environment	Neutral	Neutral	Restrictive	Neutral	Neutral
Demand Drivers	Weak	Moderate	Weak	Moderate	Moderate
Development Stage	Developed	Developing	Developed	Developing	Emerging
Adoption Rate	Low	Medium	Low	Medium	Medium
New Entrants / Startups	Sparse	Moderate	Sparse	Moderate	Moderate
Macro Indicators	Stable	Stable	Stable	Stable	Stable

Segmentation Analysis

 

Analysis by Distribution Channel

The pandan tea market is primarily driven by the offline segment, which is projected to hold a commanding 63.7% share in 2025. This dominance is largely attributed to traditional retail channels that facilitate consumer access to pandan tea, allowing for a tactile shopping experience that resonates with many customers. As preferences shift towards familiar shopping environments, the offline segment benefits from established relationships with consumers and a robust supply chain that supports product availability. Notably, organizations like the Food and Agriculture Organization highlight the importance of local markets in promoting traditional beverages, further solidifying the offline segment's stronghold. This segment presents strategic advantages for established firms who can leverage their distribution networks while offering emerging players opportunities to penetrate local markets. Given the ongoing consumer preference for in-person shopping experiences, this segment is expected to remain relevant in the near to medium term.

Analysis by Form

In the pandan tea market, the tea bags segment is set to capture over 49.5% of the market share in 2025, reflecting its appeal driven by convenience and ease of use. The growing trend towards ready-to-brew options aligns with busy lifestyles, making tea bags a favored choice among consumers seeking quick preparation methods. Industry insights from the International Tea Committee indicate that convenience products are increasingly in demand, particularly in urban areas where time constraints are prevalent. This segment offers established brands a chance to innovate with new flavors and packaging, while also providing emerging players with a platform to differentiate through quality and sustainability. As consumer habits continue to evolve towards convenience, the tea bags segment is likely to maintain its relevance and growth trajectory in the foreseeable future.

Report Segmentation
Segment	Sub-Segment
Form	Loose Leaves, Powder, Tea Bags
Distribution Channel	Offline, Online

Competitive Landscape

Key players in the pandan tea market include Teasenz, Harney & Sons, The Tea Makers, TWG Tea, Dilmah, BOH Tea, Basilur Tea, Ahmad Tea, T2, and Celestial Seasonings. These companies demonstrate significant influence and prominence, driven by their unique offerings and market strategies. Teasenz stands out for its authentic sourcing and vibrant online presence, while Harney & Sons leverages its strong brand heritage and premium positioning in the U.S. The Tea Makers and TWG Tea excel in luxury markets, offering artisanal blends and exclusive experiences. In Asia, Dilmah and BOH Tea are recognized for their commitment to quality and sustainability, which resonates well with environmentally conscious consumers. Basilur Tea and Ahmad Tea emphasize traditional flavors and cultural heritage, appealing to niche markets, while T2 and Celestial Seasonings focus on innovative flavors and wellness, attracting a younger demographic.

The competitive landscape of the pandan tea market is characterized by dynamic strategic initiatives among the leading players. Collaborations with local growers and investment in sustainable sourcing practices enhance brand authenticity and consumer trust. New product launches featuring unique flavor profiles or health benefits are increasingly common, as companies seek to differentiate themselves in a crowded marketplace. Additionally, some players are embracing digital transformation to enhance customer engagement and streamline operations, fostering a more agile response to market trends. These strategic moves not only bolster market positioning but also drive innovation, ensuring that these companies remain competitive in an evolving consumer landscape.

Strategic / Actionable Recommendations for Regional Players

In North America, market players could explore partnerships with local wellness brands to co-develop products that align with health-conscious consumer trends. Emphasizing unique flavor combinations and health benefits will also enhance product appeal, capturing the attention of a diverse customer base.

In the Asia Pacific region, leveraging emerging e-commerce platforms can facilitate broader market access, particularly among younger consumers who favor online shopping. Collaborating with local influencers to promote pandan tea's cultural significance may also strengthen brand positioning and consumer connection.

In Europe, focusing on sustainability initiatives will resonate with environmentally aware consumers. Engaging in community-based projects or sourcing partnerships can enhance brand image while addressing the growing demand for ethically produced goods. Tailoring marketing efforts to highlight these values will likely attract discerning consumers seeking authenticity.

Competitive Dynamics and Strategic Insights
Assessment Parameter	Assigned Scale	Scale Justification
Market Concentration	Low	Fragmented with small producers and regional suppliers, lacking dominant global brands.
M&A Activity / Consolidation Trend	Low	Limited deals; focus on partnerships for exotic flavor expansions in herbal segments.
Degree of Product Differentiation	Medium	Blends with health-boosting ingredients like ginger vary for functional beverage needs.
Competitive Advantage Sustainability	Durable	Natural wellness trends and cultural authenticity foster niche loyalty in exotic teas.
Innovation Intensity	Medium	Ready-to-drink and infused formats advance convenience in herbal tea consumption.
Customer Loyalty / Stickiness	Moderate	Unique flavor profiles encourage repeats, but availability limits broader adoption.
Vertical Integration Level	Low	Suppliers focus on leaf sourcing, relying on blenders for product development.