Former drug investigators have shed more light on the likely reason the cocaine worth tens of millions of dollars that’s washing up on NSW beaches was loose in the water in the first place.
NSW Police have now recovered 253 tightly bound 1-kilogram packages of the illicit drug since the first popped up on Magenta Beach on the Central Coast on December 22.
At the beginning of the week, police said that figure was at 213.
Detectives are working closely with local and specialist police, federal authorities and Surf Life Saving NSW to seize any outstanding packages and determine their origin.
The main theory behind why the cocaine was in the water
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NSW Police State Crime Command director Jason Weinstein last month said authorities were aware of drugs being attached to a cargo ship, which would explain why the waterproofed parcels were in the water in the first place.
But it’s unclear how much could be out there.
The NSW Crime Commission 2022-2023 annual report said there had been an increase in detections of “multi-tonne and multi-hundred-kilogram cocaine importations” using “mother-daughter vessel transfers”.
“This method requires a large commercial vessel, known as the mother ship, to transport the cocaine to the vicinity of Australia’s coastline,” the report says.
“The cocaine is then either transferred to a daughter ship or dropped into the ocean at a designated location, before being transported to shore.
“These ventures are increasingly sophisticated, often involving concealment of cocaine in under-water compartments of the ship and the hiring of specialist divers to retrieve the cocaine.”
It’s not the first time this importation tactic made headlines. In 2022 a body was found floating close to a bag of the drugs and a vessel from Argentina.
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Two former NSW detectives say the tactic is nothing new and that it’s likely the cocaine blocks that washed up recently were likely attached to the hull of a “mother” cargo ship, and have dislodged at some point of the journey.
This could be due to strong changes in currents, large waves from cyclones and wild weather or just bad engineering.
Former NSW Police detective sergeant Peter Moroney spent 18 years in the force and was also investigations manager for the NSW Crime Commission and said he witnessed this technique a lot back in the late 90s when he was investigating organised crime.
“Hiding the cocaine within shipments and having that ‘rip and go’ … that technique has been around for as long as I can remember,” he said.
Macquarie University criminologist Vince Hurley spent 29 years in the NSW Police Force, including several as an undercover operative, and said the method is often used by international crime syndicates to get large quantities of cocaine to Australia.
“That methodology is hundreds of years old, pirates used to do it off the coast of England, and off the coast of Africa,” he said.
“So that mother-daughter methodology is nothing new at all.”
Why the drugs were put in the water
The mark-up on cocaine in Australia is significantly higher than anywhere else in the world.
A kilo of cocaine in Sydney is on average about $300,000 to $350,000, Mr Moroney said, much more than it can sell for in South America, where it’s produced.
“If you looked at it cold-heartedly as a business model, why wouldn’t you ship your product to Australia?”
According to the Australian Federal Police, in 2022 1kg could fetch up to $400,000 wholesale, although the NSW Crime Commission annual report found the “influx of cocaine into the Australian market” pushed the wholesale price of cocaine down to $180,000 per kilogram in mid-2023.
“Which is low for Australian standards but still far higher than global averages,” the report said.
That’s a lot of money no matter how you look at it and that’s before it’s chopped up and onsold, in varying degrees of purity. Therefore, the retail value is significantly higher again.
And because of Australia’s geographical isolation, a few major players dominate this highly profitable market, unlike in North America or Europe.
Once it gets here, it’s easily sold, as most of the population is concentrated along the east coast.
Dr Hurley said police and customs officials are unable to check every single vessel entering Australia’s waters and the massive container ships parked off the coast of major ports including Wollongong, Newcastle or Sydney.
“Because Australia imports millions of pounds of goods per year, cargo ships sitting off our coast, is completely normal,” Dr Hurley said.
“And in the dead of night, for example, another smaller vessel, or a sailing boat, will come along and the cocaine or the drugs will be offloaded onto that.”
The shipment is then dropped to land at a convenient time.
Despite a cost-of-living crisis, Dr Hurley said there are enough people with plenty of disposable cash to ensure the demand remains high.
“We generally have a good standard of living, therefore we can afford the price of cocaine.”
Will the loss of the 253kg haul make a dent in the market?
While it’s impossible to know how much is making its way into the country, more is being caught in transit.
Dr Hurley said a drug once considered “choice for the beautiful people…. for the wealthy,” is now ubiquitous.
“Now because there’s so much of it, it’s become a common person’s drug.”
Mr Moroney said he’d heard anecdotally that cocaine was now the most commonly available drug in any suburban or metro pub, well above marijuana, meaning the castaway cargo washing up along the coastline is unlikely to leave a noticeable hole in the market.
“We used to work on Colombian syndicates that were shipping in, you know, several 100 kilos a week.
“And that’s the stuff that we detect and we see.”
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