CULIACAN, Mexico—It’s considered the most powerful criminal organization in the Americas, if not the world. But now the brutal Sinaloa cartel is preparing to go legit—and make millions of dollars through front organizations in Mexico’s new legal pot industry.
Cartel operatives told The Daily Beast they hope to transit from the illegal market to the multi-million-dollar legal weed market as soon as Mexico passes reform to legalize marijuana for adult use. Proponents of the drug reforms had hoped legalizing sale of the narcotics would take the profits out of the hands of killers and criminals, but members of the Sinaloa cartel are already working on infiltrating the legal market.
The result could be even greater profits for the gangland bosses—to spend on weapons, buying off politicians and growing their criminal empire. For legitimate businesses preparing for legalization of marijuana, which is expected to pass later this year, there is now the alarming prospect of competing with the cartels.
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One of the first changes as the Sinaloa cartel prepares to compete on the open market is the introduction of much more powerful marijuana. Mexican farmers working with the Sinaloa cartel in remote areas told the Daily Beast, they are already dropping the old techniques and adopting a sophisticated process that includes genetically modified crops and fertilization systems to produce more potent weed.
Some inside the Sinaloa cartel are exploring ways to set up legal shops under front men, according to cartel members. Inevitably some of the more powerful crop could also end up on the black market or smuggled into the U.S.
“We are now leaving the old Mexican marijuana aside. Our bosses brought new seeds from Germany for us to grow a better quality weed and ordered to start harvesting this new weed strain,” said a Sinaloa cartel farmer interviewed by The Daily Beast.
According to the farmer the plan for the Sinaloa cartel is to start “experimenting” with advanced techniques and top-notch seeds to be ready to "deliver paperwork” as soon as Mexico passes it’s new law and—using front operations—make out they have never been in the illegal market.
Mexico’s Senate passed a bill in late November legalizing recreational use of marijuana, but lawmakers in the lower house stalled it while trying to raise the amount of pot consumers may carry in public over the actual proposed limit of 28 grams.
The bill to legalize adult weed is currently waiting for approval from the lower house, with the deadline set for April this year.
In January, Mexico’s health ministry published rules to regulate the use of medicinal cannabis, a huge step to create the largest legal weed market in Latin America.
The new law sets rules for cultivation and harvesting of cannabis for medicinal purposes, which would allow businesses to grow marijuana legally on Mexican soil.
This is where some drug cartel members want in.
“The bosses are ready with lawyers and everything. They have been watching closely the development of weed legalization and are ready to establish a legal business,” the pot farmer said.
Another man allegedly in charge of the crops said they will still have “cheap marijuana” harvests, but mostly for local distribution.
“Our weed is getting stuck in stash houses in the U.S., it’s not selling as before. We still sell, but not as much as before since they legalized it in some places. But we are trying to make a more potent weed, more kicking, to sell in Mexico and in the U.S., wherever they want it,” the cartel operative said.
Although there is still U.S. demand for Mexican weed, seizures at the border have been dropping steadily since 2015, according to Customs and Border Protection stats.
While in 2015 the U.S. seized more than 600,000 pounds of weed at the border, 5 years later, in 2020 the number of pot seizures dropped to less than half, down to 290,000.
The Sinaloa cartel members interviewed on the outskirts of Culiacan are taking care of an unusual marijuana crop: 8,000 square meters (50 acres) under a greenhouse roof with an irrigation and fertilization system.
“This was not usual before. Here in the mountains the weed grows by itself, but this is different”, said the farmer.
This scenario has become more and more common in northern Mexico, a change from the traditional outdoor cultivation.
The farm is in the middle of nowhere, surrounded by a deep forest. The farmers have cut out the trees surrounding the field to leave room to install a metal structure as a roof from where the halogen lights hang.
Inside, the smell of fresh weed and some citric terpenes—reminiscent of citrus fruit—fills the whole greenhouse. This looks nothing like the average illegal field in Mexico.
These new strains, unlike the traditional varieties, don’t rely on sunlight. The halogen lights vary from cold to warm temperatures, depending on the stage of growing and remain on 24/7.
In 2010, the Mexican Army found a similar greenhouse containing more than 20,000 marijuana plants. Years later, inside a building in Culiacan, authorities seized another greenhouse with more than 600 plants. In 2015, another sophisticated greenhouse was found in Guadalajara, Jalisco.
“We are learning. We bring the equipment from the U.S. and most of the seeds from Europe and also from the U.S., like the California Dream. These new plants are more potent, they test up to 60 to 70 percent THC, as compared to the 5 or 8 percent in the Mexican one,” said the farmer.
What the Sinaloa cartel is planning might not be too far from the general idea behind the bill to legalize marijuana.
The war on drugs has left hundreds of thousands of victims, and the new approach is designed to reduce the violence of the cartels, according to Zara Snapp, co-founder of RIA Institute, a Mexican research and advocacy organization.
“What this new bill is trying to do is to have the people, groups or organizations that have participated in an illegal market, to transit into the legal market. If there are groups trying to transition, that’s great. Thats the whole point,” said Snapp.
She insisted that the plan wouldn’t grant any immunity to criminal organizations or individuals just because they were also selling legal drugs.
“If these groups or organizations are still participating in illegal activities—like the use of unauthorized guns—the Mexican government has the responsibility to act against them,” she said.
But realistically the cartels are not planning to go straight—the murders, blackmail and lawlessness will continue—they are simply demanding their slice of a more profitable market. While an average price for a pound of “Mexican brick” pot is around $500, a higher strain could be up to $2,500 per pound, according to U.S. official statistics.
Mexican Senator Julio Menchaca, co-author of the bill, said regularizing cannabis in Mexico would be a “big hit” to the cartels.
“This is an opportunity to pacify the country, since the production of this plant has built mafias with a huge economic power that has caused Mexico a lot of violence”, he said in an official statement.
But cartel members are not so sure they will stop operating on the illicit market.
“The group has a lot of other activities. We have to, in order to survive. It is still not sure if weed is going to get legal in Mexico and we can’t stay waiting for that to happen”, said the Sinaloa operative.
One thing is for sure: Mexican cartels will try to be in the game. While it seems like a good idea on paper, “pacifying” the country doesn’t seem that easy. The cartels in Mexico have gained most of their power not by selling weed, but by showing off their violent and ruthless hunger for money.
“If we started it all with our Mexican weed, how would we stay out of it? I don’t think so,” said the Sinaloa farmer.
