Cuba’s sugar production collapse endangers rum industry

Cuba’s once-thriving rum industry is facing a severe threat as this year’s sugar harvest has plummeted to historic lows, raising concerns over the future of one of the island’s few profitable exports. With just 165,000 metric tonnes of sugar expected from the 2025 crop, Cuba is producing less than 3% of the 8 million tonnes it generated annually in the 1980s.

The collapse in production is a direct hit to rum distillers, who depend on molasses—a byproduct of sugar refining—for their spirits. “You have to go back to the 19th century to find numbers this low,” said Michael Bustamante, chair of Cuban and Cuban-American Studies at the University of Miami. “It’s dismal.”

While Cuba has imported sugar to meet basic food needs, its rum industry cannot follow suit due to regulations requiring all ingredients be sourced domestically. The impact is potentially devastating for an industry that had seen a resurgence, with foreign investment from luxury drinks giants such as Pernod Ricard, Diageo, and LVMH.

These international players have helped elevate Cuban rum on the global stage, each navigating Cuba’s complex political and economic climate—and the U.S. trade embargo—to establish a foothold. Pernod Ricard, for instance, struck a landmark deal with state producer Corporación Cuba Ron in 1993 to manage and expand the Havana Club brand. Since then, sales have skyrocketed from 300,000 cases to over 4 million.

Other brands, like Ron Santiago, Eminente, and Black Tears, have followed, leveraging Cuba’s master rum-makers and historic reserves to produce high-end rums. The Island Rum Company, a newer player, has successfully marketed its Black Tears label by tying it to Cuban music and culture.

But as Cuba’s sugar mills crumble—down from 133 in 1959 to just 14 today, with only six reportedly still functioning—the supply of molasses is drying up fast.

“The fourth quarter will be particularly tough,” one rum executive warned. “There won’t be any alcohol.”

The rot goes deeper than rum. Cuba’s sugar industry was once the backbone of its economy, especially under the revolutionary government that hoped sugar would fuel financial independence. In 1970, Fidel Castro famously mobilized half a million volunteers in a failed bid to harvest 10 million tonnes.

But decades of underinvestment, aging equipment, and the impact of the U.S. embargo have left the sector in ruins. At the Enrique Varona mill in Falla, central Cuba, workers struggle to keep machinery alive with makeshift repairs. In stark contrast, Pernod Ricard’s modern facility near Havana operates with efficiency and global ambition—but even it depends on molasses that may no longer exist.

As the island grapples with a wider economic collapse, the fading fortunes of its rum industry underscore a deeper crisis. “It’s one of the clearest signals of the dire straits the Cuban economy is in,” said Bustamante.

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