Galvez, opening an international conference on the production and uses of ethanol, said high oil prices and increased demand for ethanol had created "perhaps the most promising moment ever" for the sugar industry.

Galvez said Cuba's annual output was just 1 million hectoliters, though installed capacity was far greater.

Cuba, once the world's biggest raw sugar exporter, has reduced acreage by more than 60 percent since 2003 and dismantled 71 of 156 mills.

Last June, 43 more mills were closed, though preserved, while this year just 11 distilleries operated, most at well below capacity for lack of cane.

Reuters estimates final output this year at just under 1.2 million tonnes of raw sugar, based on provincial media and source reports, the lowest since 1908.

The Caribbean island consumes a minimum 700,000 tonnes of sugar per year and 400,000 tonnes are destined for a toll agreement with China.

With sugar and ethanol prices soaring earlier this year, the government decided to revitalize the industry, allocating money for inputs, increasing the price mills pay for cane and opening joint-venture negotiations.

Ministry officials have stated they expect at least a 15 percent increase in output in 2007, and far more in 2008 due to a crash sowing plan, more inputs and increased rainfall so far this summer.

The harvest runs from January to May.

"I think Cuba should rethink its policy of running down sugar. I am seeing the minister this afternoon and will strongly encourage him that there is a new life line for the industry coming up," Peter Baron, director of the International Sugar Industry, told Reuters.

Baron, like other speakers at the event, was optimistic about the world sugar industry's future, stating high oil prices and improved technology had made ethanol an ever more attractive fuel.