HEROIN HAUL: A DROP IN THE OCEAN OR ENOUGH TO MAKE WAVES?

Take 400kg of heroin out of the equation, and who knows the effect it will
have on Australia's habit? It all depends on who's talking, writes GREG
BEARUP.

MICK PALMER, the straightforward and likable head of the Australian Federal
Police, stood proud at a podium in Sydney on Wednesday morning to announce
his troops' greatest triumph in their fight against the drug barons.

"To respond to some of the criticisms that are made from time to time which
say that the war against drugs has been lost, I think that is absolute
nonsense," the AFP commissioner said. "Drugs are imported by real people,
they communicate over real telephones and on the real Internet and they
transport a commodity on real ships and real boats just like any other
business anywhere else in the world.

"If we can't be successful in dealing with that because the commodity
happens to be drugs, then really there is no place for law enforcement at
all, because it could just as easily be illegal immigration, germ warfare,
small arms, nuclear arms ... and if it was any of those things then I
wouldn't suggest for a moment that we couldn't be successful."

But the real problem for Palmer and his troops is that Australia has become
a dumping ground for the huge oversupply of China White - high-grade
South-East Asian heroin.

Ray Tinker, the Federal officer who co-ordinated this week's operation, said
yesterday that intelligence from Interpol, the United States Drug
Enforcement Agency (DEA) and the AFP revealed that there are now only two
main markets being targeted by the Golden Triangle's heroin lords - Canada
and Australia.

Much of the heroin grown in Burma, Laos and Thailand used to end up in the
world's largest market, the United States, but now the South American
cocaine cartels have diversified into heroin and squeezed the Chinese
brokers out. Europe is dominated by Afghanistan and Turkey.

The DEA's report on illicit drugs said that by 1995, 62 per cent of heroin
seized in the US came from South America (there had been virtually none at
the start of this decade) and 17 per cent from the Golden Triangle. Last
year, sources said, the seizure figures for South-East Asia had shrunk even
further.

However, according to the International Narcotics Control Board, production
of heroin from the Golden Triangle has remained stable at about 240 tonnes a
year.

The effect on the Australian heroin market has been dramatic. The cost of
wholesale heroin, delivered to brokers in Sydney, has fallen from a high of
$250,000 a kilogram about five years ago to less than $100,000 a kilogram.

Paul Dillon, from the National Drug and Alcohol Research Council, says the
impact at street level has been even more drastic. An average cap of heroin
on the streets of Cabramatta or Kings Cross dropped from $80 in 1996 to $50
in 1997. This year it fell again to $30. The dealers don't even bother to
cut the heroin any more, and most times it is sold in as pure a form as it
was when it left the hills of Burma.

There has been no great increase in the number of heroin shipments arriving
in Australia, but the size of shipments has risen dramatically.

No-one knows how much heroin is consumed by our addicts and recreational
users, but for many years law enforcement bodies have been happy to boast
that they were capturing about 10 per cent. At an average of about 160
kilograms seized each year over the past five years, that would mean annual
consumption is about 1.6 tonnes.

On those figures, this week's haul of 400 kilograms means that a quarter of
all the heroin consumption has been taken out, and State and Federal police
officers believe it will have a great effect on the street-level market.
"The fact is that 20 million less caps of heroin will hit the streets of
Sydney," Tinker said.

The NSW Police Commissioner, Peter Ryan, said vigilance would be required,
especially if prices rose and addicts were forced to commit more crime to
support the inflated cost of their habits.

However, many criminologists say that the size of Australia's heroin market
has been grossly underestimated "by several tonnes", and that even a seizure
of such size will make little difference.

The AFP commissioned a study to try to estimate heroin use in Australia. It
has refused to make the document public, but the Herald understands it
estimates that consumption is much greater than previously thought.

Paul Dillon believes this week's seizure will do little to alter the market
at street level.

He is backed by the head of the NSW Bureau of Crime Statistics, Dr Don
Weatherburn, who said the "likely effect will probably be zero, because I
think it is only a small fraction of the total amount of heroin coming in".

His organisation has conducted studies following other large seizures and
found that there was no rise in prices or drop in quantity.

Checked-by: Don Beck