Can Cuba go without rum? – Sugar shortage paralyzes the island’s iconic industry

The once-mighty sugar industry on the brink of collapse

According to reports in the Guardian and Reuters, Cuba’s state sugar monopoly, Azcuba, will produce just 165,000 tonnes of sugar by the end of this season – a dramatic drop from its peak of 8 million tonnes in the late 1980s. The scale of the collapse is well illustrated by Michael Bustamante, a professor at the University of Miami, who says that “we have to go back to the 19th century to see such low yields.”

The island has been forced to import sugar in recent years due to the general economic crisis, but the rum industry – due to strict domestic raw material regulations – cannot use this option. According to an executive who spoke to the Guardian on condition of anonymity, “the fourth quarter will be particularly difficult – there will be no alcohol”.

No exports without rum

The seriousness of the situation is exacerbated not only by the domestic market, but also by the impact on international brands. Cuban rum – which is made either from sugar cane juice or from molasses left over from sugar production – is the island’s best-known export, for which British, French and other European multinational drinks manufacturers are also queuing.

However, global partnerships have been overshadowed for decades by the US trade embargo. Due to strict regulations by Washington’s Office of Foreign Assets Control (OFAC), international companies often use complex legal structures to exploit the market potential of Cuban rum while complying with embargo regulations.