|Heroin Still a Strong Market in Some Parts of the World|
|Key Words||opium, heroin, Afghanistan, government, regulation, profits|
|News Story||The trade in opium, the main ingredient in production of heroin is remaining stable in Afghanistan, despite the governmentís attempts to reduce the trade. Nowhere else is the market as concentrated than in Helmand province, which produces over half of the total in Afghanistan, which produces 92% of the global supply. And it appears that there will be another record crop this year.
While more and more of the raw product is intercepted by the government, suppliers are seeking to make the heroin purer, using more efficient means of production. That keeps a stable supply. Demand for opiates globally has remained stable as well. As a result, the price for farmers of poppies, the plants that are used to produce opium, has remained remarkably stable over the last few years.
And thatís part of the problem. As the government tries to induce farmers to produce less opium, the fact remains that farmers can get up to eight or nine times as much for opium crop than for wheat.
Further, others beyond farmers have an interest in keeping the illicit trade moving. Policemen, typically poorly paid, are used to taking bribes for looking the other way with opium production. Other members of government are similarly bribed.
The government has tried different ways of reducing the poppy crop. Aerial spraying is the method favored by the US government, but this could create significant backlash against the Afghan government. Encouraging alternative methods of development is another strategy, including licensing the legal production of opium for painkillers. Guaranteeing prices for other crops is another method, but could encourage smuggling, and given the relative prices of opium and wheat, a guaranteed price program could become prohibitively expensive for the Afghan government. Whatever the method, stemming the production of heroin will be no easy feat, when farmers are so used to producing poppies.
|Source||"The Wellness Boom." The Economist. January 4, 2007.|
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