In fact, the government has recently hiked gasoline prices, which might lure the mills to produce more ethanol from cane, perpetrating further shortage of sugar supply in the market. Extreme weather conditions in Brazil - the world's biggest producer and exporter of sugar -adversely affected sugar supplies earlier this year, as sugarcane harvest was hurt badly. Currently, just 377 mills are operating in Brazil's center-south region (the main sugarcane growing region in the country) - the smallest number in six years, as per Brazilian consultancy Datagro .