North Korean ships are earning large sums of foreign currency through drug smuggling between Southeast Asia and China in 2026, according to a source in North Korea.
“North Korean ships are carrying illegal goods from Southeast Asia to China and collecting shipping fees from Chinese traders,” the source said recently. “Much of the cargo is narcotics such as cannabis and methamphetamine, along with medicines and counterfeit goods that China bans or strictly controls.”
Chinese smugglers turn to North Korean vessels mainly because they find it easier to evade inspections that way. North Korean crews reportedly switch off their automatic identification system (AIS) or broadcast false ship names and positions. AIS transponders constantly transmit a vessel’s identity, location and course so that coast guards can track shipping. The crews also move cargo through ship-to-ship transfers late at night or in waters that are hard to patrol. This tactic has long been tied to North Korean sanctions evasion, particularly in oil and coal shipments.
The collapse of international monitoring also appears to be working in Pyongyang’s favor. The UN Security Council’s Panel of Experts on North Korea once tracked suspicious movements by North Korean ships. That oversight ended in April 2024 after Russia vetoed renewal of the panel’s mandate the previous month. South Korea, the United States, Japan and eight other countries then launched the Multilateral Sanctions Monitoring Team to help fill the gap. That group, however, operates outside the UN system and lacks the panel’s formal authority.
Once the illicit cargo reaches China, it is reportedly stored in North Korean-run warehouses approved by Chinese authorities. Chinese officials rarely inspect or control these facilities directly, so the warehouses have become a blind spot for law enforcement.
Drug smuggling deals turn sour as North Korean crews steal cargo
A single run of illicit cargo reportedly earns a North Korean ship tens of thousands of dollars. “The foreign currency North Korean ships earn by carrying drugs, undeclared medicines and other illegal goods is considerable,” the source said. “As a result, more and more North Korean vessels are getting involved in this kind of shipping.”
Because these deals take place outside any official oversight, North Korean crews sometimes seize the cargo for themselves. In some cases, they take delivery of goods in Southeast Asia and then disappear before reaching the agreed destination.
“Early last month, a Chinese trader suffered exactly this kind of loss while bringing in cannabis from Southeast Asia,” the source said. “The North Korean side took delivery of the goods and then simply vanished without a trace.”
The stolen shipment was a large load of cannabis worth about 4 million Chinese yuan (about $560,000). The crew apparently judged that keeping the cargo would pay far better than the usual fee. North Korean ships typically charge around 10% of a shipment’s value to carry it.
Since the trader had been smuggling narcotics, he could not report the theft and had to absorb the entire loss himself. According to the source, similar incidents happen fairly often because the trade operates entirely in the shadows.
For this reason, Chinese traders now commonly demand a deposit or collateral from North Korean crews before a deal goes ahead. The trader in this case had no such safeguard in place and was left to bear the loss alone.
Illicit shipping has become one of several ways the Kim Jong Un regime earns hard currency despite sanctions. Others include cryptocurrency theft by state hackers and the dispatch of overseas workers to China and Russia.
This article was originally written in Korean and translated with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
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