Police in Colombia have seized over 1,800 cows smuggled into the country from Venezuela so far this year, shining a light on one of the few contraband sectors still thriving during Venezuela's economic crisis.
In the first 10 months of 2016, Colombia's Tax and Customs Police (Policia Fiscal y Aduanera – POLFA) seized 1,895 contraband cows, worth approximately $730,000, alongside 86,000 kilos of smuggled meat, reported El Tiempo.
However, the estimates of the Colombian Ranchers Federation (Federación Colombiana de Ganaderos – Fedegan) suggest seizures represent a fraction of what is smuggled. The guild calculates the contraband meat trade is worth nearly $100 million a year and that 10,000 Venezuelan cows illegally cross into Colombia every month in the border state of Norte de Santander alone.
The cattle, which often have their brandings mutilated to disguise their Venezuelan markings, are herded along clandestine border crossings and often butchered in rudimentary -- and illegal -- slaughterhouses. Much of the meat ends up in border towns such as Cucuta -- where officials estimate 90 percent of meat consumed is illegal -- but some is also distributed to urban centres around the country, El Tiempo stated.
The trade is based on a huge price differential; one cow is worth over $500 in Colombia but under $100 in Venezuela, according to El Tiempo.
Such profit margins have led to the creation of dedicated cattle and meat smuggling mafias in the border regions. They have also attracted the interests of established underworld players, especially the Colombian guerrilla groups that maintain a strong presence in the region.
Ranchers from the border region described to El Tiempo how the National Liberation Army (Ejército de Liberación Nacional – ELN) escort herds across the border, riding ahead to check for roadblocks. According to the source, the guerrillas charge 50 percent of the value of the herd for their services.
The rancher also told El Tiempo that corrupt local officials and members of ranchers guilds also profit from the trade.
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Until recently, price differentials generated by Venezuelan price and currency controls had created a lucrative black market in Colombia for a huge range of basic goods, and smuggling had become a major source of income for organized crime and the principal economic activity in many border regions.
However, the contraband smuggling boom on the Colombia-Venezuela border is now in decline. Venezuela's economic crisis has led to widespread shortages of food and basic goods, leaving little for the smugglers to move into Colombia. However, there are two sectors in particular that have bucked this downward trend.
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The first is gasoline, which is still subject to extreme price controls and can still be easily sourced. The second, as evidenced by the POLFA results, is cattle, which exchange rate differences still make much more profitable to raise in Venezuela and then sell in Colombia.
Both sectors remain, for the moment, major sources of income for organized crime networks in the border region, especially insurgents such as the ELN, which rely heavily on capturing their share of contraband profits.