Rum deal: Cuba's drinks industry faces crisis as sugar mills close

It's a crisis that would have sent a shiver down Ernest Hemingway's drinking arm. Cuba's communist government is struggling to process enough sugar to make the rum for his beloved mojitos and daiquiris.

- Ruaridh Nicoll

As summer rains bring the Caribbean island's 2025 harvest to an end, a recent analysis by Reuters suggests that Cuba's state-run monopoly, Azcuba, is likely to produce just 165,000 tonnes of sugar this year. That compares with harvests of 8m in the late 1980s.

Michael Bustamante, the chair of Cuban and Cuban-American Studies at the University of Miami, described the situation as "dismal": "You have to go back to the 19th century to find numbers this low."

Cuba is in the grip of an economic crisis, and for the past few years has been importing sugar to feed its people, but rum producers do not have that luxury. "The regulations provide that all the liquids have to come from within the country," an industry executive said, speaking anonymously.

It is worrying because the island's rum industry has been a rare bright spot in its economy. Big international brands are involved, competing in world markets with distinctive Cuban spirits.

Diageo, LVMH and Pernod Ricard all have ventures with Cuba's government, often involving tortuous legal structures to placate OFAC, the US Office of Foreign Assets Control, which polices Washington's six-decade-plus trade embargo against the island.