New Marijuana Laws Pull Down Profits of Mexican Farmers
The more relaxed marijuana laws across the country affected a variety of industries in the different states, but it also deflated the demand and profit of farmers in Mexico. A report from LA Times expounded on the steep decline of the marijuana industry that the south of the border is experiencing.
While the U.S. federal laws still prohibit marijuana, the enforcement has been more relaxed as more states lifted their restrictions on the drug. California pioneered the legalization of the drug and 22 other states followed. Recreational use of marijuana is now allowed in various areas including Alaska, Colorado, Oregon and Washington.
The liberal treatment of marijuana legally encouraged U.S. growers and increased the competition, affecting the profitability of the Mexican industry who is a major supplier to the country.
Sinaloa small-scale growers revealed that the price for every kilogram of marijuana has decreased from $100 to $30 in the past four years. This significant drop in the earnings consequently resulted in less production, as well as less trafficking to the U.S.
Beau Kilmer of the Drug Policy Research Center said that Mexico provided about two-thirds of the marijuana consumed in the U.S. back in 2008. Now, the number has fallen to less than a third of the total, according to security and drug analyst Alejandro Hope.
Marijuana production in Mexico has declined as suggested by the decreasing number of eradications and seizures recorded. The national government is on pace to destroy 12,000 acres in 2015, a far cry from the 44,000 eradicated in 2010 according to the attorney general's office.
Quality of the produce also plays a part in the fall of Mexico-produced marijuana as U.S. growers continue to develop specialty strains with a higher amount of THC, the compound that brings 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," Daniel "Danny Danko" Vinkovetsky of High Times magazine explained. "Access to better quality American cannabis has led many to turn their backs on imports from Mexico and beyond."
According to experts, the Mexican cartels will likely follow the trend of pouring their resources in more profitable illegal drugs such as heroine, methamphetamine and cocaine. Already, the cost of heroin has been rising in the U.S.
Mexican legislator Fernando Belaunzarán is pushing for the legalization of marijuana in his own country, to disempower the drug cartels.
"We should have taken up [legalization] a while ago," Belaunzarán told Fox News Latino. "Now we've done it poorly and late, while over [in the U.S.], there's already an industry, companies that even send marijuana to this country through our porous border."
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