National Drug Intelligence Center   Appalachia High Intensity Drug Trafficking Area Drug Market Analysis 2008   June 2008   UNCLASSIFIED

Production

Illicit drug production in the Appalachia HIDTA region consists of cannabis cultivation, small-scale powder methamphetamine production, and conversion of powder cocaine to crack cocaine. Most of the marijuana available in the Appalachia HIDTA region is produced locally at outdoor grow sites; a small amount is produced at indoor grow sites. Kentucky, Tennessee, and West Virginia are included in the Marijuana Seven (primary marijuana-producing states). According to DCE/SP data, of the indoor and outdoor cannabis plants eradicated in the United States in 2007 (7,033,921), 7 percent were in Kentucky (492,615), 3 percent in Tennessee (178,322), and 1 percent in West Virginia (44,732).

Outdoor cannabis cultivation is prevalent throughout the Appalachia HIDTA region; most outdoor grow sites are operated by Caucasian DTOs, criminal groups, and independent growers. However, a rising number of reported incidents in Tennessee reveal increased involvement in cannabis cultivation by Mexican DTOs or criminal groups in Tennessee, according to the Tennessee Alcoholic Beverage Commission. Some outdoor cannabis grow sites are located by traffickers on public lands and parks to prevent the seizure of private property if discovered; such lands include the Daniel Boone and Cherokee National Forests and the Great Smoky Mountains and Big South Fork National Parks, as well as lands owned and controlled by the Tennessee Valley Authority.¹² Cannabis cultivators often protect their crops from discovery, thievery, and eradication through the use of violence and booby traps. Late frosts and severe droughts occurred during the growing season in 2007 and appear to have affected outdoor cannabis cultivation during the year. Marijuana eradication data from the Kentucky State Police, Tennessee Bureau of Investigation, and West Virginia Army National Guard indicate that approximately 460,146 cultivated cannabis plants were eradicated from outdoor grow sites in the Appalachia HIDTA region in 2007, a 43 percent decrease from the number of cultivated cannabis plants eradicated in 2006. (See Table 2.)

Table 2. Cannabis Plants Eradicated at Outdoor and Indoor Grow Sites, in Appalachia HIDTA Counties, 2005-2007

Source: Kentucky State Police; Tennessee Bureau of Investigation; West Virginia Army National Guard.

Indoor cannabis cultivation occurs on a limited basis throughout most of the Appalachia HIDTA region. According to law enforcement officials, the indoor operations that do exist are increasingly employing more sophisticated growing methods, such as hydroponics. The number of indoor plants eradicated from grow operations in the region fluctuated but decreased overall from 2005 through 2007. (See Table 2.) Nonetheless, officials with the Tennessee Alcoholic Beverage Commission report that a growing number of cannabis cultivators in their jurisdiction are relocating their operations to indoor sites because of vigorous outdoor cannabis eradication efforts by law enforcement. The cultivators are also locating their operations indoors in an attempt to attain a higher profit margin, since higher-potency marijuana produced from indoor grow sites typically yields higher prices. For example, domestic indoor-grown marijuana sold for $3,250 per pound at the wholesale level in the region in 2008, while domestic outdoor-grown marijuana sold for $2,000 per pound at the wholesale level, according to Appalachia HIDTA officials. Moreover, indoor cannabis cultivators are able to cultivate year-round with four to six harvests per year, compared with the two harvests per year that typically occur with outdoor cultivation.

Small-scale, powder methamphetamine production takes place in the Appalachia HIDTA region; however, state-enacted restrictions on the sale of precursor chemicals such as ephedrine and pseudoephedrine have led to a sharp decrease in local methamphetamine production. According to National Seizure System (NSS) data, the number of methamphetamine laboratories seized in the Appalachia HIDTA counties fluctuated but decreased overall from 2003 through 2007; most of the methamphetamine laboratories seized in the Appalachia HIDTA region during this period were discovered in Tennessee HIDTA counties (see Table 3). Moreover, most methamphetamine laboratories seized in the Appalachia HIDTA region were only capable of producing quantities sufficient for personal use and/or limited retail-level distribution, generally less than 2 ounces per production cycle. Caucasian DTOs, criminal groups, and independent dealers are the primary producers of methamphetamine in the region; they typically use the iodine/red phosphorus or anhydrous ammonia method of production.

Table 3. Methamphetamine Laboratories Seized in Appalachia HIDTA Counties, 2003-2008^*

Source: National Seizure System, run date May 2, 2008.
* Partial-year data as of April 30, 2008.

The conversion of powder cocaine to crack occurs throughout the region, particularly in urban locations. African American criminal groups and street gangs produce most of the crack cocaine available in the region; they convert the drug at or near distribution sites on an as-needed basis, typically in ounce quantities.

End Note

12. National forests suffer from the collateral effects of cannabis cultivation, including property damage to natural resources, archeological sites, and wildlife. Cannabis cultivators have destroyed numerous trees, plants, and fauna as well as park gates and fences by clearing grow sites and driving vehicles to and from those sites.

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