The market for crack cocaine is booming in Brazil, and may already be bringing in major profits for organized crime in São Paulo and Rio de Janeiro.

The extent of Brazil’s crack cocaine problem became clear in January 2012, when São Paulo police raided a central neighborhood known colloquially as a “cracolandia,” or crack land. Over 100 people were arrested and around 350 addicts were placed in the care of social services.

Brazil’s next largest city, Rio de Janerio, has also deployed police this year to sweep through “cracolandias,” bringing hundreds into government recovery programs.

Such operations are part of a widening effort to hamper crack distribution and consumption in Brazil, the world’s biggest consumer of cocaine after the United States. And cocaine’s cheaper, more addictive by-product is attracting both the wealthy and the desperately poor in Brazil. According to news website UOL, an estimated 40 percent of crack users in·Rio de Janeiro are believed to belong to the middle class. Police have said that the country now consumes around one ton of crack a day, amounting to some $11 million in profits a day. In the city of Rio de Janeiro alone, the crack trade brings in over $800,000 per month, according to police estimates.

There are some indications that the criminal group most deeply involved in the crack trade is prison gang the First Capital Command (PCC). One top anti-narcotics official has said that the PCC supplies much of the crack cocaine distributed in northeast Brazil, from the group’s homebase in São Paulo. Coca base is reportedly processed in Bolivia and shipped to Paraguay, where it is purchased by the PCC and moved to São Paulo. The PCC processes the base into cocaine, and sells the by-product as crack. Frequently, anyone who buys a cocaine shipment for distribution must also buy a percentage of crack, according to the UOL report. Drug dealers inside Brazil’s prison system will then place orders to PCC distributors via cell phones. After the deals are made, the crack is moved by trucks and buses all over the northeast.

Police have also voiced the theory that the PCC is responsible for flooding the Rio de Janeiro city market with crack, supplying it to the region’s most powerful criminal group, the Red Command (Comando Vermelho). About 90 percent of Rio’s crack is reportedly shipped from São Paulo to the southeastern city of Taubate, then onto Rio via the Dutra highway, the primary road connecting Brazil’s largest two cities.

Rio de Janeiro police told news website UOL that they first began seizing significant quantities of crack in 2003. By 2008, as many as ten favelas were suffering from a booming crack trade, all of them controlled by the Red Command. Police seizures increased dramatically, from just 14 pounds seized in 2008 to nearly 200 pounds seized in 2010. According to anti-narcotics agency the DCOD, the number of crack addicts in the city doubled during a 16-month period between 2009 and 2010.

The Red Command is so strongly associated with Rio’s crack trade that rival gangs in the city’s favelas, including the Friends of Friends (Amigos dos Amigos – ADA) and the Pure Third Command (Terceiro Comando Puro), have tried to disassociate themselves from the business. In one Rio de Janeiro neighborhood, UOL notes, the Pure Third Command hung a banner at the entrance to a favela they controlled, reading “Here we do not sell crack.” On one hand, this may be a ploy to shore up support from local communities hit hard by the crack epidemic. But it is more likely that these groups refused to begin peddling crack out of concern that the cheaper drug could drain profits from their cocaine sales.

The militia-controlled favelas in Rio have also reportedly banned the sale of crack. Nor is the drug sold in the favelas which house the community police force units known as the UPP, according to UOL.

The federal government has already promised $2 billion in aid to fight the spread of crack cocaine across Brazil. A successful strategy would likely have to involve breaking up the PCC’s control of the business in São Paulo and the northeast, as well as the Red Command’s monopoly in Rio de Janeiro. For now, there are plenty of alarm bells indicating that the crack market can only grow larger.

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