Coca and Agriculture in Cochabamba, Bolivia: Historical and Contemporary Perspectives

Does history repeat itself? Two coca booms in one hundred years.

Robert H. Jackson

In May and June of 1987 a series of short articles appeared in Los Tiempos, one of two daily newspapers published in Cochabamba City in Bolivia. The articles recorded the concern of the Cochabamba wheat farmers association (Asociación de Productores de Trigo) over the failure of the government of Víctor Paz Estenssoro to raise the price of a quintal (hundredweight) of wheat from 17.25 to 20.05 bolivianos, the price for a quintal of imported wheat flour. The articles also noted that the United States government intended to donate 180,000 tons of wheat flour to Bolivia, an action that would further distort the local wheat market.¹ In the following year, Bolivia, under pressure from the United States government, passed law 1008. This legislation attempted to limit the amount of land dedicated to coca cultivation to 12,000 hectares in the Yungas, the humid subtropical region in Western Bolivia, and in one older settlement in Chaparé, near Cochabamba. In addition, Law 1008 provided for eradicating 5,000-8,000 hectares of coca plants, pending the availability of funds in the Bolivian budget or donations from other countries.²

Although apparently unrelated, both incidents provide important insights to the ongoing issue of the illicit cocaine economy, Bolivia's role in that economy, and particularly the relationship between coca cultivation and the economy of other more traditional crops grown in Bolivia. Much of the recent literature has examined the illicit cocaine economy from the perspective of the larger coca-cocaine production process, cocaine as a part of the larger world drug problem, and United States government efforts to control production at the source.³ General studies touch on the scale of coca production, and the process of manufacturing cocaine. However, little consideration is given to the relationship between coca and other legal crops.

The current coca and cocaine boom is the second in Andean history, although the scale today is much greater. In the last years of the nineteenth century, Peru and Bolivia exported relatively large quantities of coca leaf and smaller amounts of processed cocaine primarily to Germany and the United States.⁴ Until outlawed in 1914 by the Harrison Act, cocaine found multiple uses in the United States from soft drinks to patent medicines. Coca, traditionally chewed by Andean peasants and mine workers or consumed as a tea, became a profitable export, and contributed to the development of the yungas zone, a relatively underpopulated region in the eastern part of the country.

An analysis of coca as one of different crops grown in the Cochabamba region provides insights to the inherent difficulties in the current campaign to limit coca production to traditional uses. Efforts to encourage small scale coca producers to shift to other crops are achieving limited success, both for technical and economic reasons highlighted by the 1987 articles that appeared in Los Tiempos. For one thing, the coca bush robs the soil of nutrients, and the chemicals used by the coca growers enhance soil sterility. Moreover, the removal of coca bushes hardens the soil, and makes the cultivation of other plants more difficult.⁵ The effective eradication of coca production and illicit coca exports would potentially have a devastating economic impact on Bolivia. According to one estimate, illicit coca and cocaine exports totaled in 1990 as much as half of legal exports, and therefore accounted for a large share of the gross domestic product. The illicit coca and cocaine industry employs thousands of workers, and absorbed most of the mine workers laid off in the mid-1980s by the Paz Estenssoro administration as part of a structural adjustment program (SAP) imposed by the International Monetary Fund.⁶

This essay examines coca production within the context of Cochabamba agriculture, and the relative profitability of coca when compared to prices for other crops grown in the region. The time periods covered are from the late 1890s to 1920s, and the 1980s. The objective is to document the dynamic coca production during the period of the first coca boom to provide insights to the second boom that began in the late 1970s and early 1980s, and continues to dominate Bolivia's economy and internal and foreign policies. Particularly, I hope to demonstrate the factors that made coca production attractive as an alternative to traditional agriculture, and to evaluate the impact of the current approach to illicit production as established by Law 1008 that emphasizes restriction of legal production and eradication of excess plants.

The first section examines the first coca boom. It offers an analysis of agriculture in the Cochabamba yungas, focusing on a case study of the Totora yungas, and is followed by a price of coca and selected other crops in different Cochabamba area markets, and a discussion of Bolivian coca exports. This is followed by a discussion of the boom in the 1980s that places the growth of coca within the context of political and economic changes, and the inherent contradictions between trade and agricultural policies that resulted in the series of complaints lodged by the Cochabamba wheat farmers. The dilemma of the wheat farmers, examined in detail, highlights one of the important factors that pushed peasants and laid-off mine workers to illicit coca production: the limited number of options open to many Bolivians during a period of economic crisis caused, in part, by hyperinflation related to the influx of coca dollars. Despite these contradictions, the Paz Estensorro administration imposed the structural adjustment plan that entailed reductions in social spending and the creation of a value added tax, while at the same time implementing Law 1008 designed to reduce one of the largest sectors of the economy that generated export earnings. The Bolivian coca problem, therefore, is much broader and complex than eradication.

The First Coca Boom

In the last decades of the nineteenth century the Bolivian government instituted a number of fiscal reforms, including the creation of a single land tax based upon a detailed cadastral survey. The information provided by the compilation and revision of the cadastral survey contained details not only on land tenure, but also crop production. A report prepared in 1898 by the Sociedad de Fomento Agrícola recorded the production of 81,575 cestos (1 cesto = 25 lbs) or 926.99 metric tons of coca in Cochabamba department. Coca ranked in importance in total production behind corn (24,238 metric tons), wheat (11,121 metric tons), potatoes and other tubers (45,888 metric tons), barley (4,251 metric tons), and hay (93,608 metric tons). The report also estimated the relative return per hectare for selected crops. It did not include coca, but the report clearly shows the greater profitability of more specialized crops. For example, wheat gave a return of Bs 35 per hectare, compared to Bs 100 for corn, Bs 156.66 for hay, and Bs 169.40 for fruits and vegetables.⁷ Coca most likely also gave a relatively high return per hectare.

A second report prepared in 1907 based on the cadastral survey provided more details on Cochabamba agriculture and the coca producing regions. Cultivated lands in the yungas totaled some 125,075 hectares. Yungas land values were relatively low.An average hectare of land had a value of Bs 345. This compares to Bs 1,725 for the fertile and densely populated lands in the central valley districts of Quillacollo, Sacaba, Cliza, Torata, and Punata.⁸ This second report points to an important characteristic of yungas agriculture. Land was abundant and labor scarce. The population of the yungas was small. A population count from the 1880s showed a population of 459 in Mendoza, a yungas zone in Chaparé province, and a mere 60 in the Yungas de Palomar. Pojo in Totora, which included an important coca producing region, counted 3,047. The 1900 census reported a population of only 534 in Mendoza, and in Pojo 3,150, most concentrated in higher elevation areas.⁹

The cadastral survey prepared about 1912 provides examples of the relationship between the value of coca estates, and the labor force. One property in the Yungas de Arepucho (Totora province) named San Mateo y Baltimore reportedly had an extension of 20,828 hectares, but only an assessed value of Bs 10,416. The survey did not report on the size of the labor force.¹⁰ A property named Santa María located in Machuyunga Pojo, an apparently more developed yungas zone, had a reported worth of Bs 62,500, and a large labor force of seventeen peones, the largest number reported for any yungas property.¹¹

In the majority of Cochabamba jurisdictions the cadastral survey reported both the extension and value of rural land. The Totora yungas was the one exception. The survey recorded only the value of most properties in four yungas zones: Ycuna, Arepucho, Pojo, and Machuyunga Pojo. As recorded in Table 1, the majority of the cocales had a total value of between Bs 1,000 and Bs 10,000. The more valuable estates such as Santa Barbara had a dependent labor force, and most properties did not report having peones (see Table 1).¹²

Published market prices from Cochabamba City and several regional markets document the relative value of coca when compared to other crops, such as wheat and corn. Beginning in 1898, in response to growing concerns over price inflation in Bolivia, local newspapers such as El Heraldo, El Comercio, El Ferrocarril, and later El Republicano collected and reported weekly prices from the markets in Cochabamba City, and periodically from the major markets in the provinces such as Cliza, Sacaba, and Quillacollo. For most weeks the newspapers reported basic consumer prices for grains, rice, coffee, and other foods. However, coca prices did appear periodically, particularly in the first decade of the present century. (The units of the different agricultural products discussed here are not uniform, but I have calculated the price per pound (lb.) to make the comparisons valid.)

Climatic conditions and inflationary pressures influenced price levels. Variable rainfall was a particular problem in the years 1902-1906, and agricultural prices were high.¹³ World War I stimulated demand for raw materials, but also caused a world wide inflationary trend, particularly in the last years of the conflict. Bolivian export earnings soared and, in 1918, exports, mostly tin and rubber, had a total value of Bs 182,612,851 as against imports of Bs 34,999,887.¹⁴ The short-lived export boom lead to an expansion of the money supply, and increases in agricultural prices.

The first set of coca prices comes from Quillacollo in 1900 and 1905. Quillacollo was a major regional market center in the Valle Bajo, an important agricultural zone. However, Quillacollo was not close to any coca producing region. Coca prices in Quillacollo were between two and six times greater than corn and wheat, the major grain crops (see Table 2). The Sacaba price series is larger, and contains prices from 1898 to 1906. Sacaba was a valley agricultural zone, but was also the closest major regional market to the Chaparé. Coca prices were 1.6 times to five times greater than corn (see Table 3). The largest price series comes from Cliza located in the Valle Alto, and close to the Totora yungas. The series includes barley, corn, and wheat, as well as coca. Coca prices were eight to ten times greater than barley, and two to five times greater than corn and wheat (see Table 4).