Mexican cartel moves beyond drugs, diversifies its illegal revenue streams

BY Talia Mindich  March 17, 2014 at 5:42 PM EST
Photo by Alfredo Guerrero/Mexican federal government/Flickr

The Mexican drug cartel known as the Knights Templar is supplementing illegal drug trade with the illegal trade of lucrative raw materials from the port of Lazaro Cardenas — so much so that it has become their top source of income. Photo by Alfredo Guerrero/Mexican federal government/Flickr

The pseudo-religious Knights Templar drug cartel has diversified to the extent that illegal mining, logging and extortion now rank as the gang’s top sources of income, a Mexican government official told the AP in the country’s first official acknowledgement that a major organized crime group has moved beyond drugs.

The cartel was once known for their production and smuggling of methamphetamine. Now, iron ore tops the list as their “principal source of income,” said Alfred Castillo. He is the Mexican government’s special envoy sent to restore rule of law in Michoacán, the Mexican state controlled by the Knights Templar through extortion, kidnapping and murder over the last several years.

“They’re charging $15 (a metric ton) for the process, from extraction to transport, processing, storage permits and finally export,” said Castillo. The gang controls the entire production chain, according to authorities.

Mexico’s total exports of iron ore to China through Michoacán’s port of Lazaro Cardenas climbed from 1.5 percent in 2008 to nearly 50 percent in 2012. This month, the government seized 119,000 tons of minerals at the port and 124 pieces of heavy machinery.

The Knight’s Templar’s also controls, through extortion, Michoacán’s lime and avocado production.