Posted on 04/27/2007 1:43:24 PM PDT by Sleeping Beauty
Something strange is going on in the global opium market, and it could spell trouble.
Annual demand for opium is about 4,500 tons. Last year a record 6,100 tons were produced in Afghanistan alone. That country's production is 30 percent more than total world demand. Heroin prices should, in theory, be plummeting. But they are not. So what is going on?
Opium, unlike cocaine, has a long shelf life and can be stored as a form of saving, a source of liquidity and as collateral for credit... So where is it? I fear there may be a more sinister explanation for why the bottom has not fallen out of the opium market: Major traffickers are withholding significant amounts.
Drug traffickers have a symbiotic relationship with insurgents and terrorist groups such as the Taliban and al-Qaeda. Instability makes opium cultivation possible; opium buys protection and pays for weapons and foot soldiers, and these in turn create an environment in which drug lords, insurgents and terrorists can operate with impunity.
Opium is the glue that holds this murky relationship together. If profits fall, these sinister forces have the most to lose. I suspect that the big traffickers are hoarding surplus opium as a hedge against future price shocks and as a source of funding for future terrorist attacks....
(Excerpt) Read more at signonsandiego.com ...
Can there be any surprise that neither Afganistan nor Pakistan leaders will enter those areas?
Are we surprised that during the US bombings of Afganistan, not a single poppy plant was disturbed?
During Iran Contra, we learned that heroin is legal tender for weapons throughout the world.
I believe that THIS is where you cut Al Qaeda off at the knees.
What do you think?
Why isn’t destruction of opium crops a top priority in the WoT? I should think that a nice, big batch of fast defoliant and/or fire bombs thrown regularly at all the ME’s opium fields would be a Very Good Thing.
I think you’re right. I would hate to see the crops destroyed however, because there is a legitimate use for opiates. Seize and distribute to pharmaceutical companies.
Morphine is GOOD...
How about buy the product from the farmers and use as needed and stop the flow at the source.
“Annual demand for opium is about 4,500 tons.”
This statement is a misunderstanding of basic economics. You cannot express demand as a number. It’s a relationship between supply and demand—a curve. What they are talking about is consumption, not demand.
My guess is that a lot of the opium that is produced never makes it to market, and thus is never consumed.
One of the places, certainly.
The CIA has had an on-again off-again relationship with the drug trade. Whether they are involved in this I have no idea.
There is a LOT of money in big drugs. Clinton was heavily involved in the drug trade. George H. W. Bush was involved while he was Reagan’s VP in the Mena smuggling operation conducted by the CIA to raise money for the Contras after congress cut off funding.
The Drug Enforcement Agency seems to go after the little guys and the independent smugglers and leave the large operators alone for the most part. That’s just a perception, difficult to prove.
I doubt whether our current president is personally involved, but he could be turning a blind eye to it. Who knows?
Legalize opium and watch the bottom completely fall out. AQ isn’t going to start growing cocoa plants in Afghanistan or Pakistan anytime soon. I will standby for the subsequent flaming of those who think the War on Drugs is winnable and is more important than the War on Terror.
Probably going to places like China, India, and Russia, just like all the world’s oil.
“My guess is that a lot of the opium that is produced never makes it to market, and thus is never consumed.”
Great point.
Brilliant, I urge you to read the article. The actual economics and distribution is outlined — but I had to leave it out of the exerpt.
War on Drugs and WOT are inextricably joined. Perhaps the WOT would be appreciably more winnable if the poppies were destroyed. But drugs aren’t the only source of money for the terrorists. Iran & Co. have something to do with it, as well.
Or, use Afghanistan as a source for corn production for ethanol.
Iran's motive in all this is to drive the Sunnis out of Iraq. They are not waging war against American troops. Al Qaeda, on the other hand, is. Al Qaeda is also helping the Sunnis fight against the Iran-backed Shia.
There have been plenty of stories posted to FReep that indicate Iran has been supplying weapons to Sunni terroristas including Al Qaeda.
Fundamentals of economics don’t apply to threads posted of Fridays.
” Heroin prices should, in theory, be plummeting. But they are not. So what is going on? “
Costs of processing, refining,shipping and handling, marketing, warehousing, distribution and markup haven’t changed.
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