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Torchberries are are found by harvesting Torchberry Plants. They are clusters of 5 small berries. Crafting a Torchberry with a stick, similar to crafting a Torch, will give you five Torches. Combined with the Roots commonly found in Caves that drop Sticks, you are almost guaranteed to have the necessary materials for light underground.

You can also use Torchberries to feed a Moonworm Queen, by crafting 3 Torchberries and a Moonworm Queen.