Starbucks has announced a price reduction for some of its iced beverages in China, lowering prices by an average of 5 yuan (approx. $0.70) nationwide as of Tuesday, according to Reuters.

The move comes amid growing consumer caution and intensifying competition in the country’s coffee market, which is Starbucks’ second-largest after the US.

According to a post on its official Weixin account, the company said dozens of drinks – including non-coffee options and Frappuccinos – will now be available at lower prices, with some starting from 23 yuan (approx. $3.20)

China’s coffee sector has become increasingly competitive, with domestic chains like Luckin Coffee and Cotti offering drinks at prices as low as 8.8 yuan (approx. $1.22).

A source close to Starbucks told Reuters that the decision is not a response to pricing pressure from rivals but rather an effort to boost customer visits during slower afternoon hours. The individual added that Starbucks is likely focusing on growing demand for non-coffee beverages in that time slot.

While the company has previously stated it would not participate in a price war, it has introduced smaller drink sizes and issued discount coupons to attract customers. Starbucks is also exploring options to revitalise its business in China, including the potential sale of stakes in its local operations.