The report from Packaged Facts, a division of MarketResearch.com, puts the US market for tea and ready-to-drink tea at $6.8 billion in 2005, a 9.4 percent increase over last year. By 2010 it projects that it will reach $10 billion.
Seventy-two percent of overall sales are accounted for by ready-to-drink bottled and canned ice teas, but loose tea and tea bags for future brewing comes second with 20 percent of sales. Within this category green tea is the most dynamic variety and is imbuing it with new life.
The health properties of green and white tea are being more widely publicized. It is a message that America, in the grip of an obesity epidemic, with all the health consequences it entails, is ready to hear.
It was also the most used flavor in new tea drinks in 2004, according to Productscan Online and is also used in non-beverage items including ice cream and cosmetics, bringing the benefits to those too busy to brew and drink a cup of tea.
"Green tea is hot right now - in fact, it is getting dangerously close to a cliché for a food to contain green tea," said Packaged Facts publisher Don Montuori.
Green tea has a lighter flavor than black tea, less caffeine and higher antioxidant content. But according to the report, interest in green tea in the US is a bit of a surprise since the flavor is not typical of American tastes.
Rather, it attributes the trend to the tea's reputation as "cornucopia of wellness" for everything from weight loss to preventing some kinds of cancer. This makes it a perfect fit with the wellness and anti-aging aims of baby boomers, who are unlikely to be tempted by ready-to-drink teas targeted primarily at the 18- to 24- age group.
Green tea's polyphenols and catechins have been the subject of much scientific research, and the report expects this interest to continue, helping to isolate the beneficial characteristics and most efficacious vehicles for use.
However last month green tea was dealt a blow by the FDA, which said, after reviewing evidence to support a health claim, that a link with prevention of breast, prostate and other forms of cancer was "highly unlikely".
Montuori does not think this conclusion will prove a major stumbling block for the market, though:
"If you ask a consumer what are some of the health benefits they just say that it is better for you. Only real foodies will go as far as looking at the health claims," he told NutraIngredients-USA.com.
If the FDA had concluded that green tea is harmful in some way, he believes that might affect the sales.
Dr Sin Hang Lee, a cancer pathologist who markets a green tea health drink through his company Fleminger, believes the FDA decision may even have a positive effect on the market.
"It represents the first time the FDA was willing to even consider tea as a potential health beverage and to render an opinion on it," he said.
Nor does Lee think a rubber stamp from the FDA is required to create consumer demand: "We are living in an era of information explosion. The educated consumers may become better equipped in data interpretation than the individual scientists and FDA officials."