Coffee is headed for its longest winning streak since 1980, as the market grapples with persistent supply concerns in key growing regions.

China’s Starbucks challenger Luckin Coffee has unveiled a price rise of 3 yuan (HK$3.25) for many products after the 2025 new year.

Earlier, the coffee chain was well-known for its cheap products, most of which were priced at around 10 yuan with coupons.

Meanwhile, futures for the arabica variety, preferred by coffee chains, rose as much as 1.6 percent on Tuesday. The premium bean advanced for a 10th day and is trading just shy of US$4 (HK$31.2) a pound after doubling in the past year.

Shortfalls in Brazil, the top arabica grower, continue to worry traders after record shipments earlier in the season means less availability now. On Monday, Brazilian exporter Comexim Ltda. said that the country’s output of both arabica and cheaper robusta beans is expected to decline in the 2025-26 crop year.

Technical charts suggest that prices may have risen too far and too fast, with arabica’s relative strength index entering overbought territory.

“Technical indicators are still looking overheated,” Harry Howard, a broker at Sucden Financial, said in a note on Tuesday. A decline in certified stocks would continue to fuel concern over supplies, he said.

Inventories held at exchange-monitored warehouses are now at the lowest since November. But a recent increase in the amount of coffee awaiting grading could provide some relief to tight supplies on the exchange.

Crops in Brazil’s primary arabica growing area also saw an uptick in rainfall last week after prolonged periods of dry weather, according to Somar Meteorologia data.

BLOOMBERG AND STAFF REPORTER

Xinhua

Coffee set for longest gaining streak in 45 Years on supply woes