By Mica Rosenberg
CULIACAN, Mexico, May 20 (Reuters) - Violence has exploded in Mexico’s drug smuggling heartland in a three-way battle between rival gangs and security forces, the biggest challenge yet to President Felipe Calderon’s war against the cartels.
About 300 people have died in drug murders so far this year in Sinaloa, an arid western state that serves as the home turf of one of Mexico’s main drug gangs and where traffickers worship a bandit as their own patron saint.
The killing spilled over to Mexico City this month when assassins hired by Sinaloan smugglers shot dead one of Mexico’s top federal policemen at his home, in a direct challenge to the government.
Calderon has staked his reputation on weakening the cartels, and responded to the murder by sending an extra 2,700 soldiers to Sinaloa to try to tame the state.
But Sinaloa’s hitmen, known for their swagger, were undaunted. A gang threw grenades at a police station and machine-gunned three houses just hours after the troop deployment, killing one person in the town of Guamuchil.
Synonymous for many Mexicans with drugs and "narcocorrido" folk ballads that glamorize the lives of leading traffickers, Sinaloa had a tradition of growing marijuana and opium long before U.S. illegal drug demand took off in the 1960s.
The cartel now mostly smuggles methamphetamines and South American cocaine up the Pacific coast.
"There has always been violence here because this is where drug trafficking was born ... but before it was under control," said 73-year-old Culiacan native Juan Murray.
Residents of state capital Culiacan say they now rarely go out at night because of the violence which they fear will worsen after rival drug hitmen killed the son of Sinaloa cartel leader Joaquin "Shorty" Guzman, Mexico’s most wanted man.
In a military-style attack, armed men from a rival faction gunned Edgar Guzman down at a strip mall in central Culiacan, on May 8, leaving 500 bullet casings strewn on the ground. Some 20 cars nearby were damaged in the withering gunfire.
The murder is widely attributed to the Beltran Leyva family, former allies in the cartel who have recently split with Guzman. The city expects bloody recriminations.
"The gangs are fighting each other and now with the army here the only thing we can do is hide in our houses," said Yira Sanchez, 26, holding her one-year-old daughter.
Beyond its own internal strife, the Sinaloa gang is locked in a nationwide turf war with the Gulf cartel and both sides abduct, torture and murder their rivals, sometimes beheading them.
While the Sinaloans have managed to stage attacks in Gulf territory just south of Texas, outsiders rarely penetrate Sinaloa.
Calderon, who has sent 25,000 troops against the crime syndicates since taking office in Dec. 2006, has scored successes against the Gulf cartel, extraditing its leader Osiel Cardenas to the United States last year.
But the U.S. Drug Enforcement Administration complains that Mexico’s federal forces are hindered by corrupt local police and the respect shown to Sinaloan drug bosses by the state’s residents.
"This is the center of gravity of narcotics activity from a historical perspective and its going to take a very concerted effort to be successful," said Fred Burton, an analyst for the U.S.-based private intelligence firm Stratfor.
Despite the gang’s power, residents say the Sinaloa cartel is now splitting after the January arrest of senior member Alfredo Beltran Leyva, seized with almost $1 million in cash.
The Beltran Leyva family is playing a more prominent role and has been blamed by the Mexican media for the killing in the capital earlier this month of Edgar Millan, the No. 2 in one of Mexico’s federal police forces.
That shooting raised fears that Mexico could spiral down into a drug conflict like the one in Colombia in the 1980s and ‘90s, when traffickers planted car bombs and even downed a commercial jet in a terror campaign against the government.
"The attack on Millan has taken it to another level," said Statfor’s Burton. "It is a signal to Calderon that these groups are very capable of reaching out and killing who they want to, where they want to."
Some 1,300 people have died in Mexico’s drug conflict this year but most of the deaths are still among rival traffickers.
In Sinaloa, the local economy is closely linked to drugs and traffickers even have their own patron saint.
Near the old statehouse in Culiacan, devotees flock to the shrine of Jesus Malverde an outlaw figure who, according to local legend, robbed from corrupt officials and gave the spoils to the poor in the early 1900s.
Vendors hawk everything from keychains to tequila glasses with his image.
Soldiers wearing ski-masks in the sweltering heat last week shut down foreign exchange stores on Culiacan’s Juarez Street to crack down on money laundering.
"The economy of Culiacan is half tomatoes ... and half marijuana and poppies. If they are really going to fight the narcos here, the economy of the state will completely collapse," said one street vendor too scared to give his name. (Additional reporting by Anahi Rama; Editing by Kieran Murray)