Saturday, January 2, 2016

Mexican marijuana farmers see profits tumble as U.S. loosens laws

Posted by DD.   Republished from LA Times  


This farmer in western Mexico says he began growing marijuana when he was a teenager. He says this will be his last crop. (Deborah Bonello / For The Times)

He started growing marijuana as a teenager and for four decades earned a modest living from his tiny plot tucked at the base of these rugged mountains of western Mexico.

He proudly shows off his illegal plants, waist-high and fragrant, strategically hidden from view by rows of corn and nearly ready to be harvested.

"I've always liked this business, producing marijuana," the 50-year-old farmer said wistfully. He had decided that this season's crop would be his last.

The reason: free-market economics.

The loosening of marijuana laws across much of the United States has increased competition from growers north of the border, apparently enough to drive down prices paid to Mexican farmers. Small-scale growers here in the state of Sinaloa, one of the country's biggest production areas, said that over the last four years the amount they receive per kilogram has fallen from $100 to $30.

The price decline appears to have led to reduced marijuana production in Mexico and a drop in trafficking to the U.S., according to officials on both sides of the border and available data.
"People don't want to abandon their illicit crops, but more and more they are realizing that it is no longer good business," said Juan Guerra, the state's agriculture secretary.

For decades, the U.S. and Mexican governments looked for ways to reduce marijuana cultivation. They paid farmers to grow legal crops or periodically sent Mexican soldiers to seek out and eradicate drug fields.
But those efforts failed, because marijuana was still more profitable than the alternatives.
Soldiers uproot marijuana plants to be burned
 As recently as 2008, Mexico was providing as much as two-thirds of the marijuana consumed in the U.S. each year, said Beau Kilmer, co-director of the Drug Policy Research Center at the Rand Corp. think tank.
U.S. growers, however, have been spurred on by the increasing number of states that have lifted restrictions on the drug.

In 1996, California, the nation's biggest producer, became the first state to legalize it for medical purposes. Twenty-two states have followed suit over the last two decades. Alaska, Colorado, Oregon and Washington have also allowed cultivation and sale for recreational use.

Though federal law still criminalizes production and possession, the U.S. Justice Department has backed off its enforcement efforts when they clash with state law.

The relaxed legal environment has upended the old business model.

"Changes on the other side of the border are making marijuana less profitable for organizations like the Cartel de Sinaloa," said Antonio Mazzitelli, the representative in Mexico for the United Nations Office on Drugs and Crime.

Although Mexico remains a major supplier of marijuana to the U.S., its market share is thought to have declined significantly. Alejandro Hope, a security and drug analyst in Mexico City, estimated that Mexican marijuana now accounts for less than a third of the total consumed in the U.S.
There is little reliable data on marijuana production in Mexico. But two key measures — how much is destroyed in the fields and how much is intercepted at the U.S. border — strongly suggest it has been in decline.

The Mexican government is on pace to eradicate about 12,000 acres this year, down from more than 44,000 in 2010, according to the Mexican attorney general's office.

U.S. Customs and Border Protection seized about 1,085 tons of marijuana at the border in 2014. In the previous four years, that figure hovered around 1,500 tons. Seizures are thought to represent a tiny fraction of the amount that gets successfully imported.

In addition, the number of U.S. arrests by federal agents involving foreign-grown marijuana dropped from 4,519 in 2010 to 2,367 in 2014, according to the U.S. Drug Enforcement Administration. The number involving domestically produced marijuana held relatively steady over that time with an average of 1,536 arrests per year.

U.S. and Mexican growers compete not only on price but also on quality. Legalization has expanded the market for more expensive specialty strains, which are more powerful than standard Mexican product because of a higher concentration of THC, the ingredient that delivers the high.

"Mexican marijuana is deemed lowest on the totem pole and very few people who consider themselves aficionados or connoisseurs would admit to smoking it," said Daniel Vinkovetsky, who writes under the name Danny Danko for High Times magazine. "It's typically brown, pressed tightly together for transport, and full of seeds."

"Access to better quality American cannabis has led many to turn their backs on imports from Mexico and beyond," he said.

Ethan Nadelmann, who runs Drug Policy Alliance, a nonprofit based in New York that promotes decriminalization of drugs, said he expects that Mexican exports of marijuana will continue to fall as legal cannabis proliferates. "More and more, the U.S. is going to grow marijuana here," he said.

From 2013 to 2014, the legal market grew from $1.5 billion to $2.7 billion, according to a report this year from the ArcView Group, a cannabis industry investment and research firm based in Oakland. Illegal sales are thought to be many times that.

The shifting market has forced small-scale marijuana farmers in Mexico to look for ways to supplement their incomes.

In remote Sinaloa, a 47-year-old farmer named Emilio tends four marijuana plots with his sons. He inherited the business from his father. Their municipality, Badiraguato, is famous for being the birthplace of Joaquin "El Chapo" Guzman, the world's most-wanted drug lord and head of the powerful Sinaloa cartel.

But there is little sign of the cartel's wealth in their village, official population 1,000, a two-hour drive from the main town square on a crumbling mountain road. Emilio never finished primary school and doesn't know how to read or write. His house has dirt floors. Like the other farmers interviewed for this story, he spoke on condition that his full name not be published.

One of his neighbors, 55-year-old Efrain, said he stopped cultivating marijuana a few years ago and now supports his family as a day laborer. The middlemen who used to purchase his crop barely come around anymore.

"If someone comes to buy it here, they want it really cheap," he said.

But Emilio said he can't afford to give up on marijuana.

"Even though it's not really considered good business anymore here, there's nothing else to do," he said.
His wife and daughter work occasional shifts at a greenhouse where tomatoes are grown for commercial sale — part of a government project to give families a chance to leave the drug business. The work, sporadic and seasonal, pays about $12 a day.

Guerra, the Sinaloa agriculture secretary, said the government has a responsibility to provide more as legalization sweeps the U.S.

The Mexican drug cartels are already adapting.

For one, they are moving to compete in the high-end marijuana market, according to the 2015 National Drug Threat Assessment produced by the DEA. "Law enforcement reporting indicates that Mexican cartels are attempting to produce higher-quality marijuana to keep up with U.S. demand for high-quality marijuana," it said.
 In one of the more telling signs of how legalization has transformed the industry, the DEA has found instances of high-grade marijuana being smuggled from the U.S. into Mexico, an agency official said.
"I don't really have a sense of the amount or scale, but we have seen instances of it occurring," said the official, who was not authorized to speak publicly about the subject.

 More significant, experts said, the cartels are likely to shift resources away from marijuana toward other drugs that are illegal in the U.S., including heroin, methamphetamine and cocaine. A 2010 Rand study estimated that marijuana accounted for 15% to 26% of cartel revenues.

Emilio already farms a few patches of poppies used to produce heroin.

They are a more labor-intensive crop than marijuana and require more water and a bigger investment upfront. "Poppy takes longer," he said. "And if you neglect it, the crop is useless."

But it may be a safer bet than marijuana: High demand for heroin in the U.S. has been driving up prices, and there is little chance it will be legal any time soon.


  1. war on dr

    first steps to peace primr camino a la paz

  2. Chivis!

    The mayor of a city south of Mexico's capital was shot to death on Saturday, less than a day after taking office, officials said.
    Four gunmen burst into the house of Mayor Gisela Mota, 33, in the city of Temixco - which is in disputed drug territory about 60 miles south of Mexico City - and killed her, said the government of Morelos state, where Temixco is located.

    Local police later arrested two alleged attackers, while killing two others, according to a statement issued by the Morelos attorney general's office. The alleged attackers have not been named.

    Seems like someone clearly did not want her in power ;\

  3. Economics. Any one knowledgeable--economics is a tough subject. That is will it impact illegal trade--now or later etc.

    USA is a long way off from full recreational legalization. By then Mexico will be a game player with branded/organic/certified strains. Mexican mota may be sold out of a brick. Without Mexican varieties--there would be far fewer hybrids/breeding stock. Grown well and dried/cured properly--no cannabis connoisseur in US would decline a strain from any area of Mexico (yes--Northern grows are weaker but if grown well= excellent smoke.

    Matter of time before quality increases and Mexican traffickers discover the ease and simplicity of smuggling concentrates and hash type of products.

    Cannabis is part of Mexico's agricultural legacy. Still wild in places (not indigenous).

    My bet is they will step it up and maximize gross profit right along in step lock with state legalization. Keep the price a bit lower and they still have a big market. US cannabis is more expensive than hard core dope in some respects. Perfect--cartel marketing opportunity--let's see how smart they are!

    1. ... BHO & CO2 Extracts Like Wax, Crumble , Shatter Or Referred To As DABS Will Be The Next Hot Item Being Shipped Across The Border ... 70-80% THC Content After Extraction & Vacuum Oven Purging ... Prices Range From $25-$60 A Gram ... Next Level Medication For Those That " Know " ... Trim Run Is Good While The Best Would Be Nug Run ... Gorilla Glue #4 Is One Of My Favorites At This Moment ... El Gabo

    2. check out jamaica "strain hunters" expedition on vice news... reason I say this is they are facing similar market issues in jamaica; the foreign strains they have brought in have been hybiridised with the original african ghana landraces to such an extent that they now grow as standard issue many different breeda of ganja - kushes, big buds, citrics, sweet, sour, purple, all sorts of goodies. Like you say though, the original bush herb ganja grown outdoors if tended to well is an excellent smoke, dare I say maybe even exceeding many indoor grows - depending on the soil quality and climate. I was wondering where the mexican landraces originated from, I'm presuming central africa but I may be wrong, perhaps asian or middle eastern strains were brought over to Mx and Latin America? Anyhow if Mx growers introduce a decent mix of foreign strains I'm pretty sure they will emulate the jamaican's fine example of ganja production and forecasting for the future markets. Rasta.

    3. I read that Mexican consumers were buying high grade pot from the USA. If they are doing that then Mexico is far behind the curve, if they are going to do as you say, as they cannot even supply there own with this high grade pot. IF that is the case then why are people quitting the growing if they know the options you suggest are in the works? I know pot growers here on Mexico and they are not that savvy into high tech growing and cultivating. Building and just about everything down here is not a science and done like it is in the USA. Just drive the lousy roads here and take a drive in the USA. They know the USA has nicer roads and how to do it, but why when it takes more time and money to do it. I just drove 3,200 miles in the US in the last 10 days and the roads were free of potholes. I got home home here in Mexico and found 10 potholes in 2 minutes after crossing the border. Emergency lanes would save many lanes in Mexico, but many roads have none and are super narrow. Do not expect them to get that high tech when they are knowing that pot is not going to be a money maker in the future after being made legal. When people can eventually grow there own why buy it. Most of the people that grow pot here are not educated. In fact far from it. They will go for the easy way even if it costs them more money out of their pockets. I see it everyday.

    4. Thanks a great deal for input.

      Appears most in the know see Mexican crops as not being an economic winner. Thank all those living in Mexico for your input--excelente!

      So, like prohibition regulated legalization wins.


    5. Everybody suscribes to high times..bravo!

    6. Feed the shit to cows pigs and chicken, it will be cheager than feed from the US that eats all the profit...

    7. Regular mexicans, about 90% of them do not have the $$$ to be buying "high grade fancy" shit, and the juniors that do are not what moves the drug market economy...
      --even the farmers, if they make less money now, because of "legalization" it is not a big deal, because the middlemen always shortchanged them, to the point that they can't shortchange them all that much anymore...
      --90% is supposed to be the margin for the final pushers of the cut and diluted shit, the lion's share goes to the banks of the top middlemen on the US...

  4. Can you write an article about the female mayor in Mexico that was killed? Thx

  5. Great post. Although the days of weed farming may be coming to an end, the fields will probably just be switched to poppy and things will go on.

    1. People are switching to poppy because they get paid more for it

    2. that means places that can grow poppy fields are going to get bloody because they are going to fight over those places. guerrero and michoacan mostly

    3. Yes that's true. I think that things will cool down in the 'golden triangle' though. Right now it's very violent there maybe because business is bad with the weed. So when poppy is farmed by all, things will go back to normal.

    4. @ 7:11 You're damn right. Those facking animals are only going to get worse in those places fighting for the big cash cow.

  6. BB can you tell us about the Mayor that was gun down on the first of January after being elected mayor on the 31st of Dec. I'm not sure if she was from Temixco I think she's from Morelos ..thanks BB happy new year.

  7. Member of los crisis arressted

  8. It's funny because now that marihuana is legal in many states here in the U.S, Mexico just passed a law a few months ago making marihuana legal to grow and consume in Mexico lol it's ironic because now that the Government knows there won't be any sales or transport of weed, they decide to make it legal im Mexico. Before the soldiers would take you to jail or give you a beating if they found weed on your property. That's what my dad said, he's from Michoacan.

  9. Mexican pot has a small cult following composed of those who enjoy things just like nature entended.

  10. The only thing about medical marijuana are the prices!!!Why haven't the prices dropped before it became somewhat legal?1/8 th. Of an ounce still costs between 35 to 60 dollars,and that's just for herb.once you get into wax,the price is 20 to 60 per gram.people that smoke wax build up a high tolerance and cannot go back to smoking herb.By all means if you have an actual disease like cancer,and aids go right ahead.smoking high level marijuana and wax makes people unmotivated and lazy.I know people on this site are going to disagree,but if you smoke this every day,you are a junkie.try to quit and see how that goes for you.high tch marijuana is addictive,at first it's fun and relaxing with a few tokes,but then you build up a tolerance.Just don't start and you will save a lot of money.

    1. Agree i smoke weed every day id be lying if i said im an addict

    2. Indeed. Concentrates take the romance out of smoking or vaporization of whole plant/hash.

  11. You guys are all fucking nuts mexican weed or as we call it in socal "reggie" is still a big business maybe not texas or even arizona but in atlanta philly the carolinas its still cost 1000-1300 a pound.. But like everything else if your not in it you dont know.

  12. The cartels are already growing high grade marijuana here in the u.s. California, Oregon, Washington, Idaho, Colorado...a lot of times on native American reservations, others in remote areas, others in vegetable farms disguised

  13. fine just switch to poppy plants full on. i want to see a gram of china white at 50 pesos and not 300 dollars come on cartels!! tale the high grade heroin off the asians anf make a humble junkie like me happy.

  14. Here. We're going to help you guys with some options for reporting. This way you won't have to keep posting stuff that doesn't matter. You can keep you audience interested in your website. Check out the link below.

    1. We do appreciate story suggestion but in this case the story is very old to anyone who really studies narcos. first of all it is sinaloa cartel who have the state, the drugs come up from Tx and Lousiana to st. paul (a sinaloa hub) and across to N D. to 2/3 the state, incl western portion north and southwest and across the southern plains. all drugs are push into the state but for the oil fields Meth for obvious reasons are the drug of choice. For many years. I remember reading a US Gov study on this 5 years ago.

      these experts who gave info and wrote the story are narco news skim surfers, not deep divers.

    2. @3:32PM. Sorry you feel the stories we have been publishing "don't matter" and are uninteresting. Otis's series on Pablo Acosta has so far received almost 300 comments and virtually all the comments are in praise of his reporting. Most of the other stories also received far more favorable comments than derogatory comments.
      As I said sorry we don't please you, but that is why they make Coke and Pepsi. Each to his own taste.

    3. Ah yes, reminds me of my sister. She could not believe I thought Pepsi was better than coke. She claimed pepsi had a "weird taste" that was "stomach turning". all her life she was a coke gal....then one day after years of chugging coke I walk in her home and see her sipping a Pepsi..."WTF?? I asked She replied "well honestly I don't remember drinking it much, and my daughter gave me a taste test -blind fold- of several cola brands, (niece is a pepsi gal) for a school project,,,you know what happened, yup old sis picked pepsi labeling it "far superior"

    4. RC is even better than Pepsi.

    5. Chivis, wanna go out and have a Pepsi sometime? I'm buying.

    6. Root beer is better, CUÑADA!!!
      For real high class, Sangría Señorial
      but the mother, the original, the best of the best, Coca~Cola will never be beaten on taste, logos, color or pedigree...
      --what is Pepsi pedigree, peptobismol?
      --by the way, anybody ever hear of Delaware Punch?

  15. The U.S. is dumb pretty soon they will want to legalize cocaine too.

    1. sure because prohibition works so well. Wasting billions of dollars is something that will never change. so glad your kind will be extinct in a few decades along with the DEA.

  16. Bb is the best i dont know what id do if it didnt exist! For new years my family was all quiet nothing to talk felt awkward. but as soon as someone said "Chapo" the chit chatter wouldnt stop at the table.everybody pitched in their was great! BB sell me a shirt or a least a coffee mug.please

  17. That's the hypocrisy of the war on drugs all those years USA AND STATES FOUGHT AGAINST MARIJUANA MANY MEXICANS WERE KILLED till this day . Waging a war on Mx soil and in the USA legalizing it that's akward GEORGE CARLING 1 RULE I LIVE BYE DON'T TRUST ANYTHING THE GOVERNMENT HAS TO SAY!!!

  18. 8:07 I am curious about how many mentadas de madre the unhappy critics of BB receive every day, can you help?

  19. Would be remiss in not providing this link below..

    Appears to be a clarification concerning new federal legislation which "does not" (according to author and his citations) restrict federal enforcement in legal/med pot states.

    Could be years and years before a major dent in Mexican pot export. And like some have stated Mexican nationals already run grow houses and big grows on federal land. Who knows they could be hired hands with unknown bosses.

  20. to bad for the people of sinaloa, that's all they know how to do. grow weed, smoke weed, sell weed,change weed for a litle coke and back to business. pobrecitos....

  21. It is a great website.. The Design looks very good.. Keep working like that!. marijuana


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