From Cocaine Base to Cocaine Hydrochloride: How Brazilian Criminal Governance Is Reshaping the Transatlantic Cocaine Trade

The May 2026 designation of the Primeiro Comando da Capital (PCC) and Comando Vermelho (CV) as Foreign Terrorist Organizations by the United States was framed around a threat whose underlying geography had already shifted. This article argues that the transatlantic cocaine value chain has undergone a structural reconfiguration since 2016: a growing share of the final conversion of cocaine paste and base into hydrochloride, historically concentrated in South America, now takes place on European soil, particularly in the Netherlands, Spain, and Belgium. Drawing on European Monitoring Centre for Drugs and Drug Addiction(EMCDDA)/Europol reporting (2022-2026), data from Brazil’s Fórum Brasileiro de Segurança Pública (2024-2026), and Gabriel Feltran’s ethnographic research on the “Agência,” a platform-type governance mechanism developed by the PCC to coordinate wholesale pricing and quality, the article argues, while acknowledging an unresolved attribution gap regarding the PCC’s specific role as a supplier to European processing networks, that this partial verticalization in Europe reflects a rational, asymmetric power bargain rather than South American network fragility: reducing value-in-transit exposure across the Atlantic crossing at the cost of ceding margin on final conversion. The article concludes that current regulatory instruments, aimed at the organization of origin, have not kept pace with this shift in the geography of the value chain, and proposes redirecting intelligence cooperation toward the flow of chemical intermediaries, not merely the finished product.

Introduction

In May 2026, the US Department of State designated the Primeiro Comando da Capital (PCC) and the Comando Vermelho (CV) as Foreign Terrorist Organizations and Specially Designated Global Terrorists.[1] The move was widely debated for its domestic and hemispheric dimensions: the impact on bilateral legal cooperation, Brasília’s discomfort with a classification that diverges from national criminal law, and the compliance implications for financial institutions operating in Brazil.[2] That debate, however, overlooks a deeper and less visible shift: the geography of the cocaine value chain itself had already moved, quietly, beyond the Americas.

Since 2016, European drug-intelligence agencies have documented a phenomenon that alters the classical architecture of transatlantic trafficking. Traditionally, the conversion of cocaine paste and base into hydrochloride, the highest value, most technically demanding stage of the chain, occurred almost exclusively on South American soil, with the finished product exported ready for consumption. Reports from the EMCDDA and Europol now describe a growing scale of “secondary extraction” and final-conversion laboratories uncovered in the Netherlands, Spain, and, more recently, Portugal, facilities capable of processing up to 1.4 tons of hydrochloride per week.[3] This is not a residual phenomenon. It is, as this article argues, a structural reconfiguration of the division of criminal labor along the transatlantic cocaine chain.

This article contends that this partial verticalization in Europe is not a symptom of South American network fragility, nor simply a consequence of intensified maritime interdiction along traditional routes. It is rather, the outcome of an asymmetric power bargain, made possible by a Brazilian criminal governance innovation: the PCC’s “Agência,” a price- and quality-coordination mechanism that allowed the organization to negotiate from a position of relative strength, with European processing networks, ceding margin at the final conversion stage in exchange for reduced value exposure during the Atlantic crossing.[4] Brazil, in this arrangement, is neither a mere logistics corridor nor a consumer market: it is the node that structures the bargain.

The implications for transnational security architecture are direct. Instruments such as the foreign terrorist organization/specially designated global terrorist (FTO/SDGT) designation mobilize counterterrorism tools against the organization of origin, but the chain’s real vulnerability, the flow of chemical intermediaries and cocaine paste and base toward Europe, remains poorly monitored and insufficiently understood on both sides of the Atlantic. This article examines, in four parts, the mechanics of this reconfiguration: the rupture in the classical chain beginning in 2016; the economic-criminal logic that makes European refining rational; the Brazilian link of routes and ports; and the implications for transnational security cooperation.

The Traditional Chain and Its Rupture

Until the mid-2010s, the cocaine value chain followed a relatively linear logic. Coca cultivation was concentrated in the Andean-Amazonian region, Colombia, Peru, and Bolivia, where leaf was processed into paste and then into cocaine base. The final and most sensitive stage of the process, conversion into cocaine hydrochloride, the marketable and consumed form, occurred almost entirely within that same territory, before the finished product moved on for export. Brazil figured in this arrangement chiefly as a transit corridor and a consumer market of significant size, not as a hub of value aggregation.[5]

This configuration began to fracture around 2016; a turning point the recent literature identifies with reasonable consensus. That year, the assassination of Jorge Rafaat, a central figure in trafficking along the Brazil-Paraguay border, marked the end of a 23-year partnership between the PCC and the CV and the start of open armed conflict between the two organizations.[6] From that conflict, the PCC emerged as the dominant force in logistical intermediation for cocaine, marijuana, and firearms trafficking in the region, consolidating control over the Port of Santos and extending its influence to ports and airports.[7]

The decisive element of that consolidation was not the violence itself, but an organizational innovation: the creation of the “Agência,” known internally in the PCC as the “Sintonia do Progresso,” a governance body that began regulating the cocaine trade through a platform-type model.[8] Although the term “Agência” is specific to Feltran’s recent fieldwork, the broader pattern it describes—centralized coordination bodies regulating an otherwise decentralized membership through shared codes of conduct and collective decision-making—is independently corroborated by earlier ethnographic and sociological accounts of PCC governance, which strengthens confidence in the mechanism even where terminology differs.[9] The “Agência” did not replace the thousands of autonomous traffickers who made up (and still make up) the market; it coordinated them. Its central mechanism standardizes wholesale prices for PCC members, enables economies of scale in joint purchasing, and reduces transaction costs between suppliers on the Bolivian and Peruvian border and distributors on the Brazilian coast. An individual trafficker, previously limited by his own bargaining capacity, gained access to a collective purchasing scale intermediated by the “Agência,” a mechanism recent ethnographic research describes in detail, including cases of price reductions exceeding 40 percent per kilogram when purchases are channeled through the “Agência.”[10]

It is important to circumscribe the scope of this transformation. This is not monopolistic control: information from the Brazilian Federal Police, cited by the EMCDDA, indicates that multiple organizations, not only the PCC, continue to operate out of the Port of Santos, with none exercising exclusivity over port logistics.[11] What the “Agência” produced was not the elimination of competition, but a new level of collective efficiency, and it is that efficiency, this article argues, that created the economic conditions for the next stage of reconfiguration, the partial migration of final refining to the European continent, the subject of the next section.

Why Refine in Europe? The Economic-Criminal Logic

If the “Agência” made price and quality coordination more efficient at the South American origin, why would a growing share of final conversion come to occur across the Atlantic? The answer lies not in any unilateral European decision, but in a logic of risk and cost optimization that became economically rational for both sides of the chain.

The technical evidence is robust and growing. Between October 2019 and July 2021, Spanish authorities dismantled 11 cocaine secondary-extraction facilities, with estimated production capacity ranging from 3 to 500 kilograms of hydrochloride per week.[12] Over the same period, Dutch police identified 45 such facilities, of which more than ten had estimated capacity of 100 to 200 kilograms per day, equivalent to as much as 1.4 tons per week.[13] The scale of these discoveries led the EMCDDA itself to acknowledge that cocaine hydrochloride manufacturing in Europe is “larger and more sophisticated than was previously thought.”[14] More recent data confirm the trend’s persistence: 34 cocaine-production-related sites were dismantled in the European Union in 2023, alongside a sharp rise in seized potassium permanganate, from 173 kilograms in 2022 to 2,082 kilograms in 2023, a chemical associated with the re-oxidation of cocaine base ahead of final conversion.[15] In 2024 and 2026, the pattern holds, with active laboratories in the Netherlands and expansion to five other member states.[16]

A forensic element reinforces the case for a deliberate, rather than incidental, flow. The US Drug Enforcement Administration (DEA), through its Cocaine Signature Program, identified a distinctive chemical signature, the “clean ethyl acetate processing” method, associated almost exclusively with cocaine samples seized in Europe and manufactured from Bolivian or Peruvian coca leaf, virtually absent from the thousands of samples analyzed in the United States since 2018, most of which are of Colombian origin.[17] That signature, combined with rising seizures of ethyl acetate in the Netherlands and a growing share of European samples with a Peruvian profile, points to a specific “pipeline,” Bolivian and Peruvian paste and base converted into hydrochloride on European soil.[18]

The underlying economic rationale is twofold. First, there is a risk-reduction logic in transit: transporting cocaine paste or base, intermediate products of lower recognizable purity, more easily concealed in carrier materials such as charcoal, plastic, or coconut pulp, exposes less aggregated value to seizure than transporting high-purity hydrochloride ready for consumption.[19] Second, there is an input-access advantage: the chemical precursors required for final conversion, solvents, oxidizing and reducing agents, are more readily obtained, and possibly of more consistent quality, from countries such as Germany, Poland, and Spain than in the South American context.[20] Add to this a finding the literature still treats as an indication rather than a certainty: equipment seized in Dutch laboratories replicated Colombian layouts, but was manufactured locally to a higher specification, suggesting direct technical collaboration between Latin American and European operators, including Colombian nationals arrested while working inside these facilities.[21]

What emerges from this convergence of evidence is not a chain fragmented by chance, but a rational division of criminal labor, made possible by the same coordination architecture the PCC’s “Agência” established at the origin: by standardizing the price and quality of paste and base at the South American border, the “Agência” made it more predictable, and therefore more attractive to European partners, to invest in the final conversion stage outside the continent of origin. This is not South American network fragility; it is the negotiated extension of a value chain that has itself become more efficient.

The Brazilian Link: Routes, Ports, and the Intelligence Gap

If the final conversion stage has partly migrated to Europe, Brazil remains the indispensable node of intermediation between Andean production and the European continent, and it is precisely in that position that both its strategic relevance and the principal intelligence gap of this phenomenon reside.

Brazilian territory today is structured by two main logistics corridors for international cocaine outflow. The Caipira route, under PCC hegemony, originates in neighboring countries, chiefly Paraguay and Bolivia, using largely overland and river routes in its initial stage, with recurrent use of small aircraft to move cocaine from Bolivia and Paraguay into national territory.[22] Its final maritime outflow points are the ports of Santos, in São Paulo, and Paranaguá, in Paraná, territory where the PCC holds predominant presence, alongside Mato Grosso do Sul and northern Santa Catarina.[23] The Solimões-Amazonas route, under stronger Comando Vermelho influence, has Tabatinga, on the triple border with Colombia and Peru, as its main entry point, following the Solimões and Amazonas rivers to Manaus, a distribution and transshipment hub, and from there to the ports of Vila do Conde (Pará) and Santana (Amapá), both with direct Atlantic access [24]. On this route, river transport is frequently outsourced to smaller groups, paid in kilograms of cocaine but linked, at the wholesale level, to the country’s two major criminal networks[25]

It should be stressed that the routes, ports, and seizure figures described above rest on well-documented enforcement and administrative records, not on inference. The same cannot be said for the claim in Section III linking the “Agência” to European conversion capacity, which remains an analytical inference rather than a causal chain established through direct operational evidence, a distinction this article maintains rather than blurs. A related, narrower gap concerning the PCC’s specific role as a supplier to European networks is addressed later in this section, once the relevant market data have been presented.

The financial scale of this flow is substantial. A study by the Fórum Brasileiro de Segurança Pública estimated that cocaine seized in the states of the Legal Amazon alone in 2024 corresponded to a market value of at least US$703.7 million, enough to rank it as the region’s sixth largest “commodity.”[26] Nationally, the volume of the cocaine market passing through Brazil in 2023 was estimated at no less than US$5.8 billion.[27] Seizure data on the specific Brazil-Europe route had already confirmed, as of 2020, roughly 45 tons of cocaine intercepted at Brazilian and European ports bound for the European market, with Santos and Paranaguá identified as the main points of departure, though alternative ports, such as the Paraguayan port of Villeta, are gaining relevance, possibly reflecting the influence of Brazilian criminal networks operating beyond the border.[28]

It is necessary, however, to acknowledge the limits of what this data permits us to claim. The EMCDDA identified an explicit knowledge gap as early as 2022: the PCC’s role as a potential supplier, rather than merely a logistics facilitator, of cocaine to Europe remains poorly documented, as do its possible operational connections with European criminal networks.[29] Unlike its posture in South America, where the PCC typically maintains permanent senior representatives to coordinate activities, there is no equivalent evidence of a stable representational structure on European soil.[30]

Ethnographic research on PCC governance, the same body of work drawn on earlier in support of the “Agência’s” coordination mechanism, corroborates this caution: the PCC’s international presence, though documented in internal communications (“salves”) listing members in countries such as the Netherlands, Spain, Portugal, Italy, and France as early as 2018, remains, according to the authors, “still much more oriented toward Brazil” than consolidated as a fully internationalized network.[31] This gap does not invalidate the article’s central argument, the European technical evidence on the Bolivian/Peruvian origin of European-manufactured hydrochloride stands on its own, but it imposes a clear limit: the direct causal link between specific paste or base shipments originating in Brazil and laboratories identified in the Netherlands or Spain has not yet been established with the degree of certainty required for precise operational attribution.

Implications for Transnational Security Architecture

The May 2026 designation of the PCC and CV as Foreign Terrorist Organizations and Specially Designated Global Terrorists mobilizes a counterterrorism toolkit including extraterritorial financial sanctions, expanded involvement of counterterrorism intelligence agencies, and broadened compliance requirements for financial institutions maintaining relations with Brazil.[32] These tools are extraterritorial in legal reach, capable in principle of sanctioning any entity found to provide material support to the PCC, wherever that entity operates, but they remain organizationally anchored: their reach follows demonstrated ties to the named organization, not the independent geography of the value chain. It is in this narrower, organizational sense that the instrument is designed to respond to the organization of origin, its hierarchical structure, its primary territory of operation, and its base of domestic power accumulation. What this article has shown is that the real threat no longer resides there alone: it resides also, and increasingly, at the European end of a value chain whose own production architecture has become transcontinental.

This institutional mismatch has a concrete manifestation. The same European agencies that document, with growing forensic precision, a refining capacity “larger and more sophisticated than previously thought,” facilities capable of processing tons of hydrochloride per week, a specific chemical signature linking that hydrochloride to Bolivian and Peruvian coca, simultaneously acknowledge lacking equivalent tools to trace the flow of intermediaries (paste and base) feeding that capacity.[33] On the Brazilian side, the gap is mirrored: there are no seizures of paste or base at a volume commensurate with the refining scale identified in the Netherlands and Spain, which suggests not the absence of the flow, but insufficient detection.[34] In other words, enforcement architecture on both continents still targets primarily the finished product and the organization of origin, while the chain’s most vulnerable and least monitored link, the transport of chemical intermediaries and the technical coordination of their conversion, remains relatively opaque.

Two recommendations follow directly from this analysis. First, intelligence cooperation between Brazil and the principal European destination countries (the Netherlands, Spain, Belgium) should be reoriented to focus specifically on the flow of cocaine paste and base and of chemical precursors, not solely on interdicting the finished product or mapping criminal leadership. In practice, this implies greater investment in joint port intelligence and in sharing forensic profiles (such as the “clean ethyl acetate” signature already identified by the DEA) between South American and European authorities. Second, the logic of FTO/SDGT designation, and related extraterritorial sanction instruments, needs to track the actual geography of the value chain, not merely the geography of the named organization. A regulatory response that treats the PCC as an exclusively Brazilian, or hemispheric, threat leaves uncovered precisely the segment of the chain, European refining, that has grown the most over the past decade.

There is, finally, a structural tension that should inform any forecast. The UNODC’s World Drug Report 2026 estimates that global cocaine production exceeded 4,000 tons in pure form in 2024, four times the volume produced a decade earlier, with supply growing faster than demand.[35] This structural surplus is likely to intensify, rather than reduce competition among criminal organizations for new markets and cost efficiency across the entire chain, suggesting that the economic incentive toward partial verticalization of refining in Europe should persist, or even deepen, in the years ahead.

A related empirical question, raised in peer review and more pertinent to the United States than to Europe, is whether a cheaper, more abundant cocaine supply could function as a partial substitute for more lethal synthetic opioids such as fentanyl. There are suggestive signs: US overdose deaths involving synthetic opioids fell by 36 percent between 2023 and 2024, alongside a contracting fentanyl market.[36] Whether this reflects substitution toward cocaine, reduced fentanyl-precursor access, or other factors remains an open empirical question beyond this article’s scope, and the same data record fentanyl continuing to appear, on occasion, as an adulterant in non-opioid markets, including cocaine, a risk that would cut against any substitution benefit.

Conclusion

The May 2026 designation of the PCC and CV as terrorist organizations targets the organization at its point of origin. This article has argued that the transatlantic cocaine value chain now extends well beyond that point: a growing share of the final conversion of paste and base into high-purity hydrochloride occurs on European soil, sustained by a criminal coordination architecture that made it rational, for actors on both sides of the Atlantic, to divide labor this way. This is not a South American network in retreat, but a network that has learned to negotiate its position in the global chain from a power base consolidated in Brazil. Whatever view one takes of the FTO/SDGT designation itself, the evidence assembled here indicates that instruments calibrated to the organization of origin alone address only part of the geography this article has described.

The forensic and institutional evidence assembled here, from Dutch and Spanish laboratories to the chemical signature linking European hydrochloride to Bolivian and Peruvian coca, through Brazilian logistics corridors and the mechanics of the Agência itself, converges on a conclusion that demands an operational, not merely rhetorical, response: transnational security instruments need to target the flow of intermediaries and the technical coordination of their conversion, not only the named organization or the finished product in transit.

As long as global cocaine production continues to grow faster than demand, the economic incentive toward this partial verticalization in Europe is unlikely to wane. The relevant question for policymakers, in Brasília, in The Hague, in Lisbon, or in Washington, is no longer whether this reconfiguration is underway; the available evidence already answers that with sufficient clarity. The question is whether transnational cooperation architecture will adapt to the value chain as it actually operates, or continue chasing the chain as it used to be.

Endnotes

[1] “Terrorist Designation of Comando Vermelho and Primeiro Comando da Capital.” United States, Department of State, Washington, DC, 28 May 2026, https://www.state.gov/releases/office-of-the-spokesperson/2026/05/terrorist-designation-of-comando-vermelho-and-primeiro-comando-da-capital.

[2] Anuário Brasileiro de Segurança Pública 2026. São Paulo: Fórum Brasileiro de Segurança Pública (FBSP), 2026.

[3] European Monitoring Centre for Drugs and Drug Addiction (EMCDDA) and Europol, EU Drug Market: Cocaine – In-Depth Analysis. Luxembourg: Publications Office of the European Union, 2022.

[4] Gabriel Feltran, “A Criminal Platform for the Cocaine Trade: Governance Mechanisms Changing the Balance of Power in a Transcontinental Value Chain.” European Journal of Sociology. Vol. 66, no. 2. 2025: pp. 169-197, https://doi.org/10.1017/S0003975625100064.

[5] Op. cit., EMCDDA and Europol at Note 3.

[6] Op. cit., Feltran at Note 4, p. 188.

[7] Ibid.

[8] Op. cit., Feltran at Note 4, pp. 181–182.

[9] See Karina Biondi, Sharing This Walk: An Ethnography of Prison Life and the PCC in Brazil. Chapel Hill: UNC Press Books, 2016; and Camila Nunes Dias and Edgar Dias, “Notas contextuales acerca de la creciente presencia transnacional del grupo criminal brasileño Primer Comando de la Capital (PCC).” Aisthesis, no. 70. 2021: pp. 331–354, both of which describe centralized sintonia-based coordination structures within the PCC independently of the platform terminology used in op. cit., see especially Feltran at Note 4.

[10] Op. cit., Feltran at Note 4, p. 189.

[11] Op. cit., EMCDDA and Europol at Note 3, p. 52.

[12] Centro de Inteligencia contra el Terrorismo y el Crimen Organizado (CITCO), Cocaine Laboratories in Spain(January 2019–June 2021), communication to the EMCDDA, 2021, cited in op. cit., EMCDDA and Europol at Note 3, p. 16.

[13] Op. cit., EMCDDA and Europol at Note 3, p. 16.

[14] Ibid.

[15] European Union Drugs Agency (EUDA), Drug Supply, Production and Precursors: The Current Situation in Europe—European Drug Report 2025. Lisbon: EUDA, 2025. [Note: the EMCDDA, cited elsewhere in these endnotes, was renamed the European Union Drugs Agency (EUDA) in July 2024 under Regulation (EU) 2023/1751; citations to the EMCDDA and to the EUDA in this article refer to the same institution under its names before and after that date.]

[16] European Union Drugs Agency (EUDA), Cocaine: The Current Situation in Europe—European Drug Report 2026. Lisbon: EUDA, 2026.

[17] US Drug Enforcement Administration, Cocaine Signature Program Reports (2020, 2021, 2022), cited in op. cit., EMCDDA and Europol at Note 3, p. 15.

[18] Op. cit., EMCDDA and Europol at Note 3, p. 15.

[19] Ibid., p. 16.

[20] Op. cit., EUDA at Note 15.

[21] Op. cit., EMCDDA and Europol at Note 3, p. 17.

[22] Op. cit., FBSP at Note 2, section “Rota Caipira.”

[23] Ibid.

[24] Anuário Brasileiro de Segurança Pública 2025. São Paulo: Fórum Brasileiro de Segurança Pública (FBSP), 2025, section “Rota do Solimões.”

[25] Ibid.

[26] Op. cit., FBSP at Note 2, citing FBSP study on the Legal Amazon (2024).

[27] Anuário Brasileiro de Segurança Pública 2024. São Paulo: Fórum Brasileiro de Segurança Pública (FBSP),, 2024, p. 267.

[28] Op. cit., EMCDDA and Europol at Note 3, p. 52; InSight Crime and American University’s Center for Latin American & Latino Studies, The Rise of the PCC: How South America’s Most Powerful Prison Gang Is Spreading in Brazil and Beyond. Washington, DC: InSight Crime and American University’s Center for Latin American & Latino Studies. December 2020, https://insightcrime.org/wp-content/uploads/2020/12/InSight-Crime_The-Rise-of-the-PCC-1.pdf.

[29] Op. cit., EMCDDA and Europol at Note 3, p. 52.

[30] Ibid.

[31] Camila Nunes Dias and Edgar Dias, “Notas contextuales acerca de la creciente presencia transnacional del grupo criminal brasileño Primer Comando de la Capital (PCC),” Aisthesis, no. 70. 202: pp. 341-342. This is the same source cited at Note 9 above in support of the Agência’s governance mechanism; here it is read for its more cautious assessment of the pace of PCC internationalization.

[32] Op. cit., FBSP at Note 2, section on the FTO/SDGT designation.

[33] Op. cit., EMCDDA and Europol at Note 3; op. cit. EUDA at Note 15.

[34] Op. cit., EMCDDA and Europol at Note 3, p. 15.

[35] United Nations Office on Drugs and Crime (UNODC), World Drug Report 2026, cited in op. cit., FBSP at Note 2.

[36] United Nations Office on Drugs and Crime (UNODC), World Drug Report 2025. Vienna: UNODC, 2025.