SOARING PRICES LURE PERU FARMERS TO COCAINE CROP

LIMA, Peru - The highest prices in almost 20 years for coca leaf, cocaine's
raw material, are pushing farmers in Peru to plant more drug crops, a top
anti-drug official said.

Nils Ericsson, head of Peru's anti-drug agency, told Reuters a kilo of coca
leaf was now selling for between $3 and $4, the highest price since 1985.

Coupled with a violent rebel conflict and government crackdown putting the
squeeze on drug producers in the world's top cocaine-producing nation,
neighbor Colombia, Peru has caught the eye of Colombian drug producers.

"That's why they want drug production to grow in Peru," Ericsson said in a
weekend interview.

Peru, which passed the title of top cocaine producer to Colombia in 1998,
was hailed during the 1990s for stamping out much of its bustling drug trade
under disgraced former President Alberto Fujimori.

But officials in Lima say drug production is back on the rise in the poor
Andean nation, where more than half of the country's 27 million people
scrape by on $1.25 or less a day and economic alternatives are scarce with
rampant unemployment.

Ericsson said drug traffickers, who reportedly can sell cocaine in the
United States and Europe for between $15,000 and $25,000 per kilo, were
counting on production in Peru to make up for difficulties in Colombia.

"Coca farmers have told us repeatedly that there are people paid by
Colombian traffickers are stirring up farmers so that they protest (in favor
of coca cultivation)," Ericsson said.

Peru now has an estimated 86,500-98,800 acres of coca crop, much less than
the 420,000 acres of 20 years ago. A small part of that is a legal crop made
into tea and other traditional uses.

LOW COMMODITY PRICES MAKE COCA ATTRACTIVE

The government of President Alejandro Toledo is hoping its alternative crops
programs -- designed to help farmers put aside coca in favor of legal crops
like coffee and sugar -- and manual eradication will help curb the growing
trade.

But the legal crops do not fetch the high coca leaf prices. Coffee industry
officials say Peruvian farmers get 18 cents to 25 cents per pound of coffee
they produce, but their production costs range between 50 cents and 80 cents
per pound.

Peru, unlike Colombia, does not use aerial spraying to kill coca crops. And
Ericsson said the manual eradication plan -- which entails actually pulling
out coca plants by hand -- was not as effective as expected.

The program had also triggered conflicts with farmers, he said, who
authorities were trying to convince farmers to pull out their own crops.