Mexican Knights Templar Cartel Exporting Iron Ore, Army Takes Over Port

A couple of weeks ago, we reported on the population of Michoacán State, Mexico taking up arms against the Knights Templar cartel,  the remnants of La Familia Michoacán.  The Army has made a huge push into Michoacan State now, too.  Some of the popular unrest and army action is coming into focus now. The cartel has apparently gotten so large that it has taken over the mining and export of major commodities, including iron ore and effectively taken over the country’s second largest port.

Mexican soldiers entering an iron ore mine

The Houston Chronicle reports  that the cartel, which long ago moved into oil theft, extortion and kidnapping, has now moved into exporting iron ore to Chinese mills: Such large-scale illegal mining operations were long thought to be wild rumor, but federal officials confirmed they had known about the cartels' involvement in mining since 2010, and that the Nov. 4 military takeover of Lazaro Cardenas, Mexico's second-largest port, was aimed at cutting off the cartels' export trade.

That news served as a wake-up call to Mexicans that drug traffickers have penetrated the country's economy at unheard-of levels, becoming true Mafia-style organizations, ready to defend their mines at gun point.

The cartel had apparently managed to extort land owners, mine owners, miners, state agents and even port operators.  The government instituted a rule requiring all ore exporters to certify the source of their ore and that it hadn’t come from cartel hands, and few could. 

Ofelia Alcala, a resident of the Michoacan mining village of Aquila, said that since 2012, the Knights Templar cartel has demanded residents hand over part of the royalty payments from a local iron ore mine operated by Ternium, a Luxembourg-based consortium. Alcala, a member of a self-defense group that rose up in arms in Aquila this summer to kick the cartel out, said the cartel also had been hiring people to extract the ore without permits, and then exporting it through another Pacific coast port, Manzanillo.

"They weren't content with getting our money and robbing our trucks, so they began secretly extracting our minerals," said Alcala.

This may explain in part the local uprising.  The cartels had totally taken over the state, and co-opted all levels of society, to the point that there was almost no legitimate state.  The citizens then decided to take up arms and take the state back by themselves.  Faced with this affront from the population to the State’s traditional role as having the monopoly on legitimate force, the state was forced to act. 

The state also apparently realized it may have been a two-way street from China, with ore going out and precursor ingredients for methamphetamine coming in, to say nothing of the possibility of Chinese manufactured guns.  When the cartels controlled the port, they controlled not only what went out, but what came in.