Mexico’s Farmers Face Widespread Extortion, Raising Food Prices and Disrupting Commerce
The June 2024 kidnapping of two US government agricultural inspectors in Mexico’s Michoacán state is just a taste of the daily reality that thousands of Mexican farmers face under constant extortion from criminal organizations.
While President-elect Claudia Sheinbaum has acknowledged that extortion is a major issue, the practice has only grown in Mexico’s rural agriculture sector. These crimes have contributed to higher food prices, affected exports, and even prompted farmers to move to the US and Canada.
Avocado Production: Just the Tip of the Iceberg
On 18 June 2024, US Ambassador to Mexico Ken Salazar announced that the US Agriculture Department (USDA)’s Animal and Plant Health Inspection Service (APHIS) had suspended avocado and mango inspections in Michoacán after two of its inspectors were assaulted and briefly detained.
The suspension was limited to Michoacán and did not affect shipments already in transit to the US. The inspection program resumed soon after Salazar met with Michoacán’s governor on 24 June 2024 to discuss security conditions for the APHIS inspectors.
While the agreement assured acceptable security conditions for those US employees, it did little to alleviate the constant harassment and protection rackets that organized crime inflicts on Mexican farmers across the country.
Mexican farmers have become an easy target for organized criminal groups for three main reasons. Rural communities are isolated, which makes it hard for federal and state security forces to access them. These remote communities also rely on cash transactions because they often lack access to the banking system. Criminal organizations can also easily detect farmers’ harvests and produce shipments along unguarded secondary roads, making these goods vulnerable to seizures and theft.
Extortion Hits a Wide Range of Food Products
Mexico’s agriculture, livestock, fishery, and forestry activities accounted for 4% of its GDP in 2023, World Bank figures show. These sectors can all be targets for extortion.
Extortion is affecting prices for many agricultural products, Mexican magazine Gatopardo reported on 30 August 2023. Consumer prices for avocados, chicken, fish, limes, mangoes, papayas, and tomatoes have risen due to the protection rackets that farmers, fishermen, cattle ranchers, and truckers must pay to drug cartels and criminal organizations.
Organized criminal activity in the agriculture sector has a 10%-12% impact on price increases for the end consumer, the National Agriculture Council (CNA)’s Félix Martínez Cabrera told national newspaper El Sol de Mexico in November 2023. CNA is Mexico’s largest organization of farmers and rural producers.
Government figures showed that prices for agricultural products rose 14.33% annually in the first half of July 2024, Mexican columnist Eduardo Ruiz-Healy wrote in the business newspaper El Economista. He added that fruit and vegetable prices rose 25.6%.
“Many of these increases are due to the additional cost of payments to organized crime by producers, transporters, warehouse owners, wholesale distributors, and retailers of fruits and vegetables,” Ruiz-Healy said. “The price increases for prepared food vendors were to recover what they had to give to the criminals who extorted them.”
Criminal organizations have been known to charge between MXN6,000 and MXN7,000 (about USD300 to USD350) to allow produce truckloads to reach their destinations on a weekly or monthly basis, Marisol Ochoa wrote in a 29 July 2024 El Economista article. The same criminals charge each harvest worker between MXN500 and MXN800 per month (about USD25 to USD40) to work undisturbed, El Sol de México reported.
Extortion in Mexico reached a rate of 7.95 cases for every 100,000 inhabitants in 2022, El Sol de Mexico reported — the highest figure in a decade. The actual rate is likely even higher, as extortion incidents are notoriously unreported.
Community Displacement: Another Consequence
A lack of response from state and federal authorities has prompted farmers to seek job opportunities elsewhere.
Extortion is prompting farmers to migrate to the US and Canada, General Farmers and Workers Union (UGOCP) leader Luís Gómez Garay told local newspaper Diario de Xalapa. About 15% of Mexico’s usable farmland is underutilized because of increased extortion by organized crime, he added.
While extortion occurs across the country, Gómez Garay said the most affected states are Guanajuato in Central México and Guerrero and Michoacán in Western Mexico.
Figures from Mexico’s statistics agency indicate that nearly 700,000 people were displaced in 2022 due to criminal violence, Mexican news outlet Imagen Radio reported. This includes extortion and armed confrontations between rival cartels. Many lived in rural communities relying on agriculture, forestry, and small-scale commerce to generate income.
Lack of Government Action
President Andrés Manuel López Obrador has openly refused to engage in any significant plan to combat organized crime, instead using a strategy he calls “Hugs, not bullets” (Abrazos, no balazos). However, criminal violence has grown exponentially since the hands-off policy went into effect, the Wall Street Journal reported in February 2024.
Criminal gangs have grown more rapidly and exerted greater control over larger portions of Mexican territory since López Obrador took office in 2018, the article stated.
Arrests have dropped significantly since the president’s strategy of “Hugs, not bullets” went into effect. Mexico’s Federal Police force arrested nearly 19,800 people in 2017 who were suspected of committing criminal acts, national statistics show. López Obrador replaced that force with the National Guard during his first year in office, which carried out 3,588 arrests in 2023.
“The Mexican army has largely stopped fighting drug cartels here, instead ordering soldiers to guard the dividing lines between gang territories so they won’t invade each other’s turf — and turn a blind eye to the cartels’ illegal activities just a few hundred yards away,” a November 2021 Associated Press report from Michoacán stated.
No Change in Sight
Claudia Sheinbaum, who will be inaugurated as president on 1 October 2024, has promised to take action to combat extortion against Mexican farmers. However, she will have a busy agenda during the first few weeks in her new role.
Congress must discuss and vote on several constitutional reforms that López Obrador has put forward. One proposes classifying extortion as a “high-impact” crime. If passed, the reform would prevent those accused of extortion from being released on bail — a common scenario.
During a meeting with CNA leaders in April 2024, Sheinbaum said extortion is not considered a serious offense under Mexican law. This complicates enforcement, as those arrested for extortion can obtain bail relatively easily and are rarely apprehended again.
“Extortion must be classified as a serious crime, which it is not,” Sheinbaum said, adding that this distinction must be included in both federal and state penal codes. Farmers are often too afraid to report extortion to authorities, she said. This information can be leaked back to the criminals who take reprisals in the form of beatings, kidnapping, and — frequently — murder.
Only a handful of Mexican state governments have shown they can effectively take action against extortion and organized criminal activity. They have strengthened state police forces by adding troops, raising wages, and improving training and equipment. The most successful examples (on paper) include Aguascalientes, Baja California Sur, Durango, Querétaro, and Yucatán. The states most affected by crime, which include Guerrero and Michoacán, continue to be plagued by internal corruption.
Despite these challenges, navigating a business within an increasingly complex criminal environment requires an eyes-open approach to the issue. While a proposal to strengthen penalties for extortion is in play, we currently do not anticipate the security realities to improve under the Sheinbaum administration. Businesses must prepare accordingly.
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