I've been trying to understand some of the economics of the heroin trade. Lehrer did a piece yesterday about the poppy business in afghanistan.
If we take the story at face value, they discuss a farmer, Ahmed Ollah, who " is a small farmer, just a couple of acres." Ahmed sells his 800kg of opium at the farm door for about $40/kg = $30,000. The opium gets trafficked into Iran and turned into 'potentially' 80kg of heroin; street value in Europe, approx $7 Million.
Does anyone have a good idea of the economics of what happens between the farm gate and the street?