Tis the season for tea…Well, to be fair, every season is a season for tea, evidenced by its growing market size. In 2026, the tea market size has been valued at USD $72.51 billion and estimated to grow from $76.95 billion in 2027 to reach $102.4 billion by 2032, at a CAGR of 5.88% during the forecast period (2027-2032), per Mordor Intelligence. 

Three key consumer trends are reshaping and helping to grow the tea market: functional wellness, low-to-no caffeine demand, and organic products, according to a recent article in New Hope Network’s newsletter. 

The first trend is the growth of functional wellness teas. According to Persistence Market Research’s report, Functional Tea Market Size, Share & Growth Trends, 2033, the global functional tea market is currently valued at USD $2.4 billion and is projected to reach $3.8 billion by 2033, growing at a compound annual growth rate (CAGR) of 6.8%. This growth represents a significant opportunity for retailers and coffee shops/cafés/restaurants to expand their functional tea offering and capture more health-conscious consumers in stores and increase tea sales in the aforementioned foodservice establishments. 

Consumers are also seeking out less – or no – caffeine teas. From 2019 to 2023, decaffeinated tea consumption globally rose about 22% per Market Growth Reports’ Decaffeinated Tea Market Size & Outlook to 2035. The global market research firm projects the global decaffeinated tea market is likely to grow from USD 162.41 million in 2026 to USD 237.6 million in 2035, with an average CAGR of 4.4% during the forecast period. Growing options such as herbal blends and decaf black and green teas expanded retail SKUs by some 15% year-over-year in mature markets. Health-concerned consumers – approximately 35% in key markets – now prefer decaf tea as a staple alternative to regular caffeinated tea.  

Mordor Intelligence attributes the shift to health-conscious consumers in general and to Gen Z in particular, noting that they show “a preference for teas that are low in caffeine, organic and ethically sourced.”  

The Market Growth Reports research discusses ‘decaf’ and ‘low caffeine’ but does not discuss ‘caffeine-free’ teas — of which herbal/botanicals are a significant segment. Herbals/botanicals are also fuelling functional and wellness teas, offering a tea for everything from joint and digestive health to panaceas for menopause and mental wellbeing (e.g., stress and tension relief). 

The biggest single driver – the third trend – behind organic tea’s popularity is increasing health awareness according to Mordor Intelligence. The Organic Trade Association reports that sales of certified organic products totalled $76.6 billion in 2025, a 6.8% increase over the prior year (U.S. Organic Marketplace Achieved Significant Growth in 2025 | OTA). Organic products continue to generate steady growth, with Mordor Intelligence projecting a CACR of 12.2% from 2026 to 2031 (Organic Tea Market Size, Trends Analysis & Growth Drivers, 2031). The rising demand for microplastic-free, ethically sourced organic products presents a premium pricing opportunity for retailers, as well as for coffee shops/cafés/ restaurants. 

Retailers offer consumers variety and options, while coffee shops/cafés/restaurants continue with the same offerings when it comes to tea for a simple ‘cuppa’: black tea, green tea, mint tea, and chamomile tea. Foodservice establishments must start to provide a bolder assortment, including organic and decaf/caffeine-free varieties, more flavour options, and of course, functional/wellness teas — and not just in the RTD form. Tea has strong margins so it makes a good case for “if you offer it, they will come — and buy.” 

Vanessa L Facenda is editor of Tea & Coffee Trade Journal. She may be reached at: [email protected].