* Fortified frontier cuts drug smuggling into Israel
* Police and drug users report dry spell, rising prices
* Bloody turmoil in nearby Arab states also curbs supply
* "High quality" home-grown and medical weed filling void
By Maayan Lubell
ISRAEL-EGYPT BORDER, Jan 30 (Reuters) - Israel's newly fortified Egyptian border has delivered a severe blow to drug smugglers, forcing its hashish and marijuana smokers to deal with a new kind of high - soaring prices.
The ravines that snake past rocky red mountains once provided a popular, low-risk route for traffickers to run drugs, women and African migrants into Israel over the southern frontier along Egypt's Sinai desert.
But with a rise in Islamist militant violence in Sinai, Israel in 2011 accelerated the fortification of the border with a five-metre (16-foot)-high fence, state-of-the art surveillance and special military forces - with a crippling side effect for smugglers.
And as workers weld the few remaining patches of the metal barrier, drug supply in Israel is down and prices are up.
"We've hit smuggling hard. Just last week we caught almost 100 kilos of hashish. That's millions of shekels," said a senior Israeli military officer in the area.
As far as the army is concerned, any breach of the border could be a potential militant attack by one of the jihadi groups that inhabit the Sinai. That is why soldiers can find themselves dealing with criminal activity together with police.
The Bedouin traffickers have deep knowledge of the millennia-old trade route, the officer said.
"They (the smugglers) know the terrain as well as we do. They collect intelligence on us and observe our movements. They do all that well, but we wait for them at the right spots and we catch them."
Middle East turmoil has affected the northern drug route into Israel too. Neighbouring Lebanon has become increasingly embroiled in the Syrian civil war and violence in the area has complicated cross-border narcotics trafficking.
Though a criminal offence, marijuana and hashish consumption is fairly common in mainstream Israel. According to the United Nations Office on Drugs and Crime, almost nine percent of Israelis use cannabis.
These drug consumers today spend between double to triple what they would have before 2011, when neighbouring Arab states descended into political turbulence and bloodshed.
"I just paid 5,200 shekels ($1,492) for a plate (100 grams) of hash. Two or three years ago it would have cost 2,000 shekels," complained one Israeli who said he smokes the drug daily. Palestinian hashish consumers in the West Bank have cited the same price jump.
Briefing an Israeli parliamentary committee last week, police said the drug "dry-spell" caused by the fence on the Egyptian border might not last, with the eastern Jordanian frontier possibly turning into an alternative drug route.
In the meantime, to meet market demands, suppliers have been increasingly dealing home-grown "Hydro", which is marijuana grown on water.
"We see more and more labs operated inside flats, basements, and private homes equipped with automatic ventilation, watering and even fertilisation," police said. "This cannabis yields high-quality drugs in relation to that smuggled over the borders."
Smokers, it appears, agree.
"All I need is one slim joint of Hydro in the evening and that's cool, I'm flying," said a second smoker.
Medicinal marijuana, which is allowed in Israel under certain Health Ministry regulations, has also been seeping into the illegal drug market, according to users and police.
Hydro-marijuana and medicinal marijuana both sell for the same street rate - about 1,000 shekels for 10 grams. The same amount smuggled in from Sinai before the border was fortified would have gone for about a third of the price.
"The high with these drugs is much better than the regular weed that came in from Sinai," said a third smoker. But scarcity and costliness have dampened the fun. "It's become like cocaine. You think about each and every gram." ($1 = 3.49 Israeli shekels) (Additional reporting by Noah browning in Ramallah; Writing by Maayan Lubell; Editing by Mark Heinrich)