Addicting information: the cocaine market

Alejandro Hope, writing in the Mexican on-line political journal Animal Politico, breaks down data supplied by convicted cocaine smuggler and “Zeta” regional boss Raúl Lucio Hernández to derive some estimates of the internal market for narcotics in Mexico.

Two things that should be noted.  Coca is one of the few cash crops that cannot grown in Mexico (cranberries is another), so all cocaine is, by definition, imported.  Secondly, Hope is using the highest possible estimates for narcotics use, and admits his estimate of  the amount by which  pure cocaine is “cut”  (adulterated) before it is sold to consumers might inflate the user numbers.  With the bulk of consumption in areas close to the United States border, there is an unstated assumption that much of the retail sale is again cut and sold retailed across the Rio Bravo del Norte.

Still, for all the talk about Mexican narcotics use, and even giving the highest possible user estimates, you are still dealing with what should probably be considered economically as cargo and not as a consumer product:

Hope estimates that the entire Mexican narcotics market is only 1.4 percent of that of the U.S. narcotics market.  Even excluding the fact that the U.S. has three and a quarter times the population of Mexico and is a much wealthier country, the market in Mexican for narcotics is negligible.

As to cocaine, the most recent figure I can find claims about 2.5 percent of the U.S. population are either “recreational users” or addicts.  That would work out to just under 8 million people in the U.S.,  compared to the 422,000 in Mexico, or about 0.035 percent of the population.

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Another interesting fact to look at is that, according to ICE (Immigrations and Customs Enforcement), 53 percent of Mexican narcotics pass through Sonora and into the United States by way of Arizona.  What’s fascinating about that is that Sonoran and Arizonan border towns have much lower levels of violence than communities along the border.  Of course, ICE — being a federal bureaucracy — was justifying its requests for more funding.  And, as the ICE-men note, the Sonoran-Arizona connection is controlled by the Sinaloan “cartel”, which has largely been left alone during this “war on drugs” … a fact that is interesting, but one upon which I don’t feel qualified to comment.