Narrator: In 2016, an international smuggler was fined $9.8 million after taking golden kiwi sprouts to China. A few years earlier, thieves siphoned $18.4 million worth of Quebec's pure maple syrup. And in 2022, authorities caught smugglers transporting $2.2 million worth of these clear pearl lobster larvae from Indonesia to Singapore. A lot of the world's most expensive foods get smuggled. So, depending on the strategy, all they need to do is get that price lower. Narrator: But some smugglers say they have legitimate reasons for illegally cashing in. So, what leads to food smuggling? And how are governments and food producers fighting back? Food smugglers often, one, exploit products with high demand, creating black markets; two, exploit environmental protections meant to limit supply; or, three, exploit specific household brands to make a profit. New Zealand's golden kiwis and Canada's maple syrup

fall into this last category. They can't be grown by just anybody anywhere. This limits supply, keeps prices high, and attracts smugglers. Pure maple syrup was at the center of one of Canada's biggest heists. In general, pure maple syrup is rare and time-consuming to make. A bottle of grade A maple syrup can cost over $40. That's almost 15 times as expensive as popular imitation syrup. So, table syrup, that is actually not maple syrup. It's usually corn syrup or cane syrup. Maybe a little bit of maple flavoring added to it, because it's not from a maple tree at all. Narrator: And while this syrup was tapped in New York, and this was tapped in Vermont, Canada produces the most maple syrup of any nation, with Quebec leading the way. Syrup from the province is heavily regulated by the organization Quebec Maple Syrup Producers.

also known simply as The Federation. The Federation sets the quality standards and the price for all maple syrup made in Quebec, but also sets quotas on how many trees producers can tap. The journalist Brendan Borrell reported on the maple-syrup heist in Quebec in 2012. Brendan: At the time I was working on this article, there were about 7,000 farms that were producing maple syrup, and there was a waiting list of about 1,200 farms, and pretty much year after year they weren't adding anybody to the list. Narrator: These other farms weren't allowed to officially sell their syrup within the province, which led to an underground market. Farms in other Canadian provinces and the US were ready to buy this surplus syrup for cash. By this point, The Federation was already reserving about 10% of Quebec's production a year, housing it in a warehouse.

Brendan: The floor is all sticky, and all these barrels are stacked, like, six high. Each barrel is worth, by the way, about $1,200. Narrator: This ensured constant supply even during a bad harvest year, but it also laid the foundation for the great Canadian maple-syrup heist. Brendan: Turned out there was an insider, a guy who rented space next door. Every evening, he would let in the gang of rebels to come in and siphon out the maple syrup, and in many cases, they replaced the syrup with water so that nobody would notice, and then they drove away. And because there was already this kind of underground economy operating, they had people who were willing to buy the syrup and had sort of these trade routes to get it out of Quebec and out of Canada. Narrator: Between 2011 and 2012, 6 million gallons, worth 18.4 million US dollars,

were stolen from the warehouse. So, it put a dent on syrup demand, and farmers don't get paid until their syrup gets sold. Narrator: The heist didn't stop production, which continued to rise, but by then, the market had changed. Quebec wasn't the only player anymore. Between the introduction of The Federation's quotas and 2020, maple-syrup production in Vermont increased by 264%. Brendan: Ultimately, this boils down to being an ideological debate. I mean, on the one side, you have this very controlled socialist system where it's like, all for one, one for all. You know, we're going to agree to only sell this much and at this price because it benefits us as a group, versus sort of the free-market philosophy. Jeff: A lot of our recommendations to governments are to pull back on the laws. You know, it's you want to control, you want to maintain safety, right, consumer safety,

you want to ensure fair trade and competition. That's what lowers prices, not artificially introducing excise taxes or different laws that create differences between markets or across borders that facilitate smuggling, for example. Narrator: Another smuggling debate is happening across the globe between New Zealand and China, this time about a special fruit. The golden kiwi is a unique strain of kiwifruit developed through crossbreeding to be sweeter and softer than a normal green kiwi. While green kiwis have a thick, hairy skin that provides a protective layer, golden kiwis are completely hairless and much more easily damaged. Even though they're smaller, golden kiwis cost almost twice as much as green kiwis. This particular variety of golden kiwi, called SunGold, is controlled by Zespri, a cooperative of kiwifruit growers in New Zealand. This perfected strain has an export value of 253 million New Zealand dollars.

Growing golden kiwis is so lucrative that it's caused a feud between New Zealand and China, where the fruit is native, because not just anyone can grow these kiwis. Zespri only releases a certain number of licenses every year, and growers bid on them. In 2022, the median price for a SunGold license hit $801,000 per hectare. We have IP protections around who's able to grow it and who shouldn't be growing it. And gold kiwifruit is, it's a handcrafted product. Yeah, we grow it in nature, but so many hours go into it. They get touched so much. And whether it be fertilization, pruning, tying down the fruiting wood, thinning flowers, it just needs so much attention. Narrator: However, after a kiwi grower successfully smuggled SunGold sprouts overseas, a number of illegal orchards popped up in China.

The smuggler was fined NZ$14 million in damages, but since then, the unauthorized SunGold orchards have soared, so much so that at one point, there were more illegal golden kiwis than legal ones. In 2022, China was growing 12,000 hectares of golden kiwis, and New Zealand 9,000. In 2023, Zespri estimated the numbers in China were back down to about 8,000. But Zespri is still fighting, and it's starting to take legal action against individual growers. Jeff: One of the things that comes to my mind when I see that is intellectual-property rights aren't just limited to consumer products or electronics or clothing or handbags or watches. You know, we think about that, but it's also a big aspect of innovation in the agricultural sector. Narrator: Here at Wiroa Orchard, located in Kerikeri, in the heart of Northland, New Zealand,

golden kiwis are carefully harvested with gloved hands. It can be five years before a new SunGold kiwi orchard is ready for harvest. Most of the work is orchard care. I don't think a lot of people actually understand how much labor and work goes into creating the product that they're eating. Jeff: That's a significant loss of revenue to these corporations. In addition, their brand is being jeopardized, right? They've invested a lot to do that, and then someone comes along and steals it. Most importantly, all that time was put into developing that seed, the consumer buys that seed, there's no logo on it. Their IP is at risk. And what's that say to other developers? You try to develop something new, and you think, well, why bother if it's just going to be stolen the next day? Narrator: Sometimes there's no ideological debate. Smugglers see foods with high demand and take shortcuts.

That's what happened with pearl lobsters, fish maw, and stockfish, each of which had their own black market. Stockfish is cod that's dried by cold air and wind without using salt, and the market has all the qualities that entice smugglers. First, stockfish has to be imported. Due to Nigeria's hot and humid climate, stockfish has to be dried here in Norway, where there are entire operations dedicated to the seafood. Second, it's expensive. A full drying rack like this is worth over $500,000, and it sells for $65 per kilogram, seven times as much as other popular fish, like croaker. Third, the demand is high. Narrator: That's Abbey Cheke. She's the fisheries consultant at the Norwegian Seafood Council. Narrator: In 2015, Nigeria imported $8.94 million worth of stockfish from Norway. But how does the black market work?

Narrator: Those import duties are reflected in the final price the consumer pays, making the product more expensive. To evade these duties, smugglers started operating in Nigeria's neighboring countries and then smuggled the fish over land borders. A lot of that is tax arbitration. So you have two neighboring countries; one country has a higher tax, one country has a lower tax. So they can move products between one country or the other and avoid the taxes, thereby charging a slightly lower price to the consumer, and that's what drives smuggling. Narrator: To fight smuggling, Nigeria closed its land borders in 2019, easing trade for many dealers. Roughly 10,000 metric tons of stockfish entered Nigeria in the years leading up to 2023. Narrator: But Abbey says the most important move Nigeria made was simplifying the legal process for importing stockfish and making sure traders understood just how simple the process could be.

Narrator: This awareness is making a difference. Abbey says there are now 150,000 people involved in the stockfish trade, up from 90,000 when the black market was operating. While Nigerians love stockfish, Chinese consumers across the globe can't get enough of fish maw, and that high demand has led to a growing black market. It's this balloon-like internal organ, known as a fish maw or a swim bladder. Fish maw is traditionally considered one of the four treasures of Cantonese cuisine, along with shark fin, abalone, and sea cucumber. Narrator: Dried fish maws can sell for up to $800 a pound, but older maws like this one, from a large slate cod croaker, are valued as high as $4,000 for a single piece. But the supply chain in China is facing a big problem. Fish maw is so prized that Chinese waters have been overfished,

leading to new limits preventing local fishers from catching and selling. Today, the majority of fish maw is imported from other countries, including Uganda, where fishing for an invasive species called Nile perch on Lake Victoria has become a lucrative business for locals. Narrator: In just five years from 2014 to 2019, the fish-maw trade in Uganda grew from $35 million to $76 million. The organ is so prized that smuggling and theft are rampant in the industry. Fishers like Amba Francis place their bait in the water and come back later to check their catches. Each hook is demarcated with a bottle, so he knows which lines belong to him. But smugglers have learned that too. Narrator: This is a huge loss for fishers, who have already made a big investment to get into the trade. Not everyone can afford the initial investment of equipment, which includes a government-licensed boat,

an engine, plus regulation hooks and bait. Narrator: Smugglers, on the other hand, operate without a license and keep their fishing costs much lower, maximizing profits. Jeff: The vessels that these people go out in are barely seaworthy, right? So their costs right from the beginning on the capital are low. Narrator: Crime is also an issue on land. Hakeem says some of his colleagues have been robbed while transporting their goods to Chinese buyers. Narrator: Because of the regulations and pricey entry into the trade in Uganda, some fishers, like David Olyabo, have given up on Nile perch and the fish-maw trade completely and turned to cage farming as a safer investment and a cheaper alternative. Narrator: While the Nile perch in Lake Victoria is considered an invasive species, for years, fish maw has been linked to the illegal fishing of endangered species worldwide. A large croaker in Mexico's Gulf of California

called the totoaba is now in danger of extinction. But this fish, often dubbed the cocaine of the sea, is still illegally trafficked into China. In April 2023, US Customs seized $2.7 million worth of totoaba fish maw hidden in a shipment of frozen fish fillets in Arizona. In Indonesia, smugglers are after something much smaller to the eye. These tiny clear larvae are pearl lobsters. An adult lobster can cost nearly $100 a kilogram, six times as expensive as other popular varieties, like Maine lobsters. They're known for their blue-green shells, rainbow-colored spots, and extra-long antennae. Narrator: Pearl lobsters are found throughout the Indian Ocean and west Pacific, from Africa to northern Australia. But the waters around Indonesia are where their largest communities exist, like here in Ekas Bay. The demand for Indonesian lobsters, particularly pearl lobsters, is very high in countries

like Singapore, China, and Vietnam. Wild pearl lobsters are always more expensive because they tend to be larger than their captive counterparts. Narrator: They're not available year-round, so Indonesia started farming them. It's not an easy job, but it can be very profitable. Narrator: Breeders like Murdim raise pearl lobsters in captivity. This method ensures a more reliable supply of lobsters, but keeping them healthy is no easy feat. The lobster larvae, or seeds, as they're called, are placed in nets that float directly in the ocean, exposed to natural elements. Narrator: But perhaps even riskier, they're exposed to smugglers. Large suitcases of larvae are smuggled to Singapore, and from there exported to Vietnam and China. Singapore is asking its lobster traders for clearer paperwork, but the illegal activity doesn't seem to stop. A suitcase seized in May 2024 had over $300,000 worth of larvae.

The smugglers are facing an eight-year prison sentence and a $92,000 fine. But this is just the tip of the iceberg. The Indonesian government estimates that in 2019 alone, it lost more than $64 million in revenue to illegal exports. Indonesian authorities have been trying to tackle the issue for years, banning exports of all lobster larvae in 2016 and again in 2021, but that didn't stop smugglers. In autumn 2022, authorities caught smugglers transporting $2.2 million worth of lobster larvae. In 2024, Indonesia decided to resume exports to capitalize on global trade. Exports are only open to Vietnam, which relies solely on imported larvae for its lobster farms. Indonesia is expected to receive $1.2 billion from Vietnam for the larvae. While maple syrup and golden kiwis are limited by quotas to localize production, other foods need quotas to be saved from extinction.

That's the case with Spanish baby eels. But smugglers disregard those limits. Angulas are the young of the European eel. They're a delicacy in Spain, where every year they're auctioned off for thousands of dollars. This kilogram of baby eels has just sold for over $7,000. And while angulas are prized for their crunchy texture, they have a very mild taste, almost nonexistent. Narrator: But angulas are tiny. Fishers need to catch 3,000 of them to reach 1 kilo, a task that requires spending entire nights in the water in total darkness, braving strong tides and stormy seas. Narrator: Eel scarcity is the result of years of overfishing. It's estimated that the European eel population has declined by 95% since the '80s. Many countries have set strict fishing quotas in response to this decline. Eel fishing here in Ribadesella is heavily regulated.

Fishers like Manolo are only allowed to fish baby eels between November and February, with five mandatory rest days each month. Each fisher needs to hold a license, and certain beaches are no-fishing zones. Breaking any of these rules can cost as much as 6,000 euros. These regulations mean that the price of angulas has skyrocketed in recent decades. Narrator: Manolo has been fishing eels for the last 33 years. He's one of 46 fishers here in Ribadesella who are licensed to fish angulas. But smugglers are making things difficult. Despite the quotas, eels are still fished illegally. In 2017, Spanish police uncovered an international trafficking operation headed for China, which included 2 million euros' worth of angulas. Between 2022 and 2023, Europol arrested 256 people responsible for trafficking an estimated 13 million euros' worth of baby eels.

This uncertainty is pushing up the price for legally caught angulas even further. The first-day auctions generate a lot of buzz, with chefs arriving from all over Spain to make their bids. But it's unclear if the seasons to come will be able to support this rise in demand. The European eel is listed as critically endangered, and fewer and fewer baby eels arrive at the beaches of Ribadesella each year. Narrator: Not all baby eels cost over 7,000 euros. Cost is variable depending on the time of the year. That's why for fishers like Manolo, it's impossible to rely on just angula fishing for a living. Narrator: In the last 50 years, the demand for the increasingly scarce eels has risen so much that gulas, a cheaper copy of baby eels, were born. Gulas are made of surimi, the same fish paste used to make imitation crab,

and cost 62 times less than angulas. They're now just as popular as the real thing. Smuggling doesn't just worsen environmental problems like overfishing; it also causes them. Smuggled produce can carry invasive pests that damage crops. There's a real-life example right now going on in California with fruit-fly outbreaks, which have been some of the worst outbreaks that we've seen in 70 years. Narrator: California started fighting the fruit fly in the '60s, and since then, things have only gotten worse. In 2023, the infestation got so bad, some 79 square miles of Los Angeles County were placed under quarantine. The fly is native to Asia. It's unclear which fruit brought it to California, but authorities believe it may have been introduced by travelers or by mail. These pests don't just damage crops; they also damage trade relationships between countries. Brian: Invasive species in general are expected to

have about a $40 million impact on US agriculture here on an annual basis, and that's just here in the United States. Across the world, the United Nations expects that invasive species has about a $220 billion impact and loses about $220 billion worth of exportability just by the presence of invasive species.

6 Of The World's Most Smuggled Foods | So Expensive Marathon | Business Insider

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