Mexico’s Sinaloa cartel built an empire on cocaine, but it’s betting on another drug to feed US appetites

• The powerful Sinaloa cartel built an empire by smuggling cocaine through Mexico to the US.
• But the cartel is shifting its focus to a new, more potent drug to keep up with changing US appetites.
• At a lab in Sinaloa’s heartland, cartel members told Insider how they’re working to keep US drug users hooked.
• Visit the Business section of Insider for more stories.

Culiacán, MEXICO – Mexico’s powerful Sinaloa cartel built an empire on cocaine, but it’s shifting its focus to a new, more powerful drug in in response to changing demand in the US.

Although the cartel, known for its now-jailed kingpin, Joaquin “El Chapo” Guzman, is still a huge distributor of cocaine in the US, the organization is betting on fentanyl to feed the demand for opioids north of the border while keeping the cartel on top in Mexico.

Fentanyl is a powerful synthetic opioid analgesic similar to morphine but 50 to 100 times more potent, according to US authorities. Mexican drug cartels add fentanyl to heroin to boost its potency and raise its market value.

On a recent trip to Sinaloa state on Mexico’s Pacific coast, Insider got access to a fentanyl laboratory operated by the Sinaloa cartel.

The laboratory was a rudimentary improvised tent a couple of hours outside of Culiacán, Sinaloa’s capital city. The set-up included a huge cooking pot, a homemade press, and some laboratory tools. It took a trip by highway, a switch from a car to an off-road pickup truck, and a short walk into a dry forest to get there.

The lab was occupied by five men: a cook, three helpers and an armed lookout in charge of the two-way radio communications. All were dressed in green camouflage uniforms.

They have operated fentanyl and heroin labs since 2019, when the cartel decided to leave marijuana crops and poppy fields aside to meet the new demand.

"Our client base at the other side [of the border] don't want the old black chiva anymore," said a cartel member in charge of the illegal lab, referring to Mexican black tar heroin.

US drug users "got used to a super powerful heroin boosted with fentanyl," the member added.

According to him, users in the US started asking for fentanyl-boosted heroin in 2015, but they didn't receive the order and recipes to cook it until 2019.

"The cook learned from a Chinese man, brought all the way here by the" cartel. "He is the only one who knows the recipe," the cartel member told Insider.

"But many started dying because we still didn't have the right recipe, and some of them were not aware of the potency of the new product," he added.

One of those victims was Landon Marsh, the youngest son of Arizona State Sen. Christine Marsh.

"He bought a street drug laced with fentanyl, and it killed him", said Marsh, who is now fighting fentanyl in Arizona by advocating the use of fentanyl testing strips.

"Our state is facing an opioid crisis. We have lost 8,140 lives since June of 2017, and fentanyl-laced drugs are a significant factor in that crisis," Marsh told Insider.

In 2018, more than 30,000 people overdosed with fentanyl in the US, making it one of the most lethal illicit drugs in history, according to the US Center for Disease Control and Prevention.

It is precisely this strategy - mixing heroin with fentanyl - that has made the Sinaloa cartel a top player in the relatively new business.

A leaked 2019 DEA report called the cartel "a prominent producer and trafficker of Mexico-based fentanyl into the United States."

Mexican authorities reported a 466% uptick in fentanyl seizures in 2020, amounting to about 2,400 pounds (1,301 kilograms), compared to 405 pounds (222 kilograms) in 2019, according to Mexico's Defense Ministry.

"We busted 175 illegal fentanyl laboratories, 92% more than those in 2019," Luis Cresencio Sandoval, Mexico's defense minister, said at a recent press conference. Sandoval said 76% of the labs discovered last year were outdoors, like the lab in Culiacán.

But Mexican cartels have adapted quickly.

"We stopped using big established laboratories because the [Mexican] government started to hit us hard. This lab was raided by the military a few weeks ago, but we got a heads-up of the operation and left with all the valuable stuff," said the cartel lookout.

Most of the chemicals used in the operations are illegally imported from China and Germany, according to the cook. As soon as the fentanyl powder reaches Mexico, they begin to cook in order to ship it to the US.

"We cook from 10 to 20 kilos (22 to 44 pounds) of heroin a day, and we work most of the week", said the cook. The street value of a 10-kilo batch can be up to $3 million.

On January 29, one of the most prolific Sinaloa cartel operators in the US pleaded guilty in a US court to running a distribution ring.

Ramiro Ramirez-Barreto supplied heroin and fentanyl to Virginia, North Carolina, Texas, and California, according to US authorities.

Ramirez's court documents said the Sinaloa cartel's distributors use "hidden traps in privately owned vehicles, couriers, and semi-trailers, trucks, and recreational vehicles" to smuggle fentanyl-boosted heroin into and around the US.

Ramirez-Barreto worked with several other US nationals, according to the indictment, reflecting changes in how the Sinaloa cartel is feeding demand in the US and broader changes in the cartel's operations.

Mexican cartels are recruiting US citizens specifically to get shipments into the US in an attempt to beat temporary border restrictions that only allow US citizens to get across.

"Since the gringos closed the border to Mexicans, we started using gringos with US passports to smuggle for us. This hasn't stopped, not even during the pandemic," said the cartel operative.

"We will produce as much as they want. There is a lot of money in this. If they want harder drugs, we will produce them and smuggle them to the other side. You have to give the client what he asks for," he said.