Cocaine Huge Profit Margins

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Victor Pinzon's opinion

Cocaine Huge Profit Margins

The following data is based on an article by Geraldo Reyes, The Miami Herald, 3/01

Colombia produces 882 tons cocaine per year

One kilogram of cocaine costs $1,500 in Colombia

One kilogram of cocaine costs $30,000 in Miami

Americans spent $36.1 billion buying cocaine in 2000 which is equivalent to 6 times GM’s profits, the first company of the 500 Fortune.

Colombian peasants in Putumayo produce about $3,000 per hectare monthly, and they produce cocaine paste now.

Colombian peasants sell cocaine between $500 and $600 per kilogram.

One hectare of coca produces about 1.6 kilos of base that converts into 1.4 kilos of pure cocain. And, 5 crops per year.

The current cultivated area is about 122,500 hectares.

FARC buys at $500 per kilo and pays in cash or with coupons that convert into food or supplies

It costs about $300 to process base into cocaine

Cocain price is about $1,200 and $1,500 per kilo at the lab

FARC charges a tax of $2,600 for each national flight and $5,600 for each international flight from airfields controlled by them

Thoise who transport the cocaine charge $1,000 to $1,500 per kilo placed in Mexico or the Caribbean. The price raises to $7,000 per kilo in Mexico or the Caribbean. 60% enter the US via Mexico.

On the US border, the price raises to about $16,000 per kilo

Placed in cities in the US the price goes up to $30,000 per kilo.

The price of one kilo of pure coca at $30,000 increase bustantially more when is mixed with other substances for retail sales for cocaine less pure or as raw material for crack.

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