Though crime syndicates struggled to move drugs in the initial months of the pandemic when global shipping shut down and transit came to a halt, they soon learned to adapt.
The result, according to the US Drug Enforcement Administration’s (DEA) latest National Drug Threat Assessment report, has been new fentanyl manufacturing capabilities, altered cocaine smuggling modus operandi, and increased control of supply and distribution chains by Mexican crime groups, which even hiked prices of methamphetamine.
Mexico’s Expanding Role in Fentanyl
Given fentanyl’s potency, only small amounts need to make it to the United States for the deadly synthetic opioid to be profitable. Mexico’s crime groups made fentanyl smuggling a priority during the pandemic. According to the DEA, COVID-19 restrictions did not affect the availability of fentanyl in the United States. In fact, fatal overdoses increased, eroding recent gains made in reducing opioid deaths.
China has long been the main supplier of illegal fentanyl to the United States, but the country has seen its role diminish since 2019 when the United States and Chinese governments agreed to crack down on the supply of fentanyl and fentanyl-related compounds (FRCs). Reduced global maritime shipping and the shutdown of the Chinese city of Wuhan — an epicenter of fentanyl manufacturing – also likely reduced Chinese exports of the drug and its precursor chemicals during the pandemic.
The Sinaloa Cartel and the Jalisco New Generation Cartel (CJNG) — the two Mexican crime groups that control fentanyl smuggling to the United States — responded to the shortage by seeking other sources of precursors and ramping up their “capacity and capabilities” for fentanyl production, according to the DEA report. Clandestine laboratories have been increasingly discovered across the country.
Mexico’s crime groups have also pushed to manufacture mass quantities of fentanyl pills, with the intention to sell them in regions with high opioid pill consumption.
Thirty-eight US states reported deaths related to fentanyl-laced counterfeit pills in January 2020, a massive jump from 22 states in April 2018, according to the DEA.
The increased prevalence of fentanyl pills is alarming, given that the drug is 50 to 100 times more potent than morphine. The number of seized fentanyl tablets containing a potentially lethal dose increased from 10 percent in 2017 to 26 percent in 2019. People addicted to opioids are often unaware that illegal pills they have purchased are laced with fentanyl.
Cocaine Industry Largely Untouched by COVID-19
While COVID-19-related restrictions on vehicle transit between countries and global maritime shipping impacted cocaine networks early in the pandemic, the drug’s availability and pricing were ultimately unaffected in the United States.
This is a clear indicator there is still a massive amount of cocaine flowing from South America and that the “supply chain remains intact,” states the DEA report.
Coca cultivation and cocaine production in South America have remained at near record levels. Large reserves of product stored in warehouses before the pandemic also helped traffickers avoid shortages, according to a report by the Organized Crime and Corruption Project (OCCRP).
Traffickers turned to Central America as a waystation and transit point. Drug plane traffic to the region soared. Land routes to Mexico were also revitalized.
When COVID-19 restrictions eased and it came time to smuggle the drugs across the US-Mexico border or on maritime cargo headed to Europe, traffickers concealed large amounts of cocaine in shipments amid limited transport opportunities. The strategy — a reversal of the typical modus operandi of hiding small amounts — led to massive seizures.
Inflated Methamphetamine Prices
While the cost to purchase methamphetamine remains low compared to other drugs, its prices climbed during the pandemic at both a wholesale and retail level.
The price jump was initially attributed to production or supply chain issues. But the DEA report claims that Mexican crime groups used COVID-19 to artificially hike prices. The Sinaloa Cartel and the CJNG were already looking to raise the price of methamphetamine, according to the DEA, and the groups purposefully held up shipments destined for the United States to create the illusion of a shortage.
Mike Vigil, the former head of the DEA international operations, said that the price hike was a short-term response to supply chain issues brought on by the pandemic in order to mitigate losses, rather than a planned manipulation of the market to increase revenue.
As has been reported with fentanyl, methamphetamine in pill form — either resembling pharmaceutical pills or ecstasy (often referred to by its chemical acronym MDMA) — became more widely available. This is a likely attempt to spread into areas not formally associated with the drug and to tap into niche markets, such as the clubbing scene.
Both the ongoing pandemic and this market expansion could lead to a further rise in methamphetamine prices, the report predicts.