Afghanistan opium crop blight sends drug prices soaring

The Afghanistan opium harvest dropped 48 percent this year, the United Nations announced. But analysts say the resulting higher prices could draw more farmers into the business.

A crop disease in Afghanistan took a major toll on the country’s opium harvest this year, reducing output by 48 percent from last year, the United Nations Office on Drug and Crimes said in a report released Thursday.

The blight, however, is expected to have little affect on the Taliban, for whom opium is an important source of funding. Those hit hardest will likely be the poppy farmers themselves, who rely on opium revenue for most of their cash spending. Opium is the narcotic latex sap of a variety of poppy flower and can also be processed into heroin and other drugs.

“The poppy income is not the single, major income or revenue source for the Taliban. It’s different from region to region, but I think it does not hit them particularly hard if the crop goes down,” says Thomas Ruttig, codirector of the Afghanistan Analysts Network in Kabul.

For years the Taliban has depended on diverse revenue streams that include informal taxation and protection rackets. Mr. Ruttig says those sources of revenue are probably more important to the organization than opium.

Additionally, opium has a long shelf life and the Taliban is likely to maintain reserves for times when there is a poor yield, such as this season. Afghan opium production outpaced global demand in both 2008 and 2009.

Still, the International Security Assistance Force (ISAF) and NATO troops who have been working to curb the cultivation and production of narcotics in Afghanistan are hoping that the blight may take at least a small bite out of the insurgency's operational ability.

Future impact

“The crop disease is not expected to have a significant impact on security operations in the near future," says US Navy Lt. Nicole Schwegman, an ISAF spokeswoman. "Crop loss, however, may have an impact on insurgent activity in the next year by creating a loss in insurgent revenue.”

Afghanistan produces about 90 percent of the world's opium, with almost all of it harvested in nine southern and western provinces, including Helmand and Kandahar, the country’s most unstable areas.

The production decline came almost entirely from crop disease, not a result of farmers turning away from the crop, as the amount of land used to cultivate poppies in 2010 remained virtually unchanged from 2009, according to the 32-page UN report (pdf). The disease struck when it was too late in the season for farmers to plant another crop.

After remaining relatively stable for years, opium prices climbed 38 percent this year. The price increase raised concern among UN officials that opium cultivation will increase next season as more farmers are drawn to the crop by this season's higher prices. When the price of almost any agricultural commodity rises, farmers plant more acreage with that crop. Heroin demand in Russia and Western Europe, the principal market for Afghan production, appears robust.

“With those high prices, what are the farmers’ intentions for what to plant in the coming season?” says Jean-Luc Lemahieu, a UNODC representative in Kabul. The nearly 50 percent reduction “might look good in the short-term, but in the long-term it really creates a situation of anxiety.”

To avoid more farmers turning to opium next season, Mr. Lemahieu says the government and international agencies must work convince farmers that by growing alternative crops their security will improve.