Mexican drug barons have begun to manufacture fentanyl, the deadly synthetic opioid ravaging North America, according to US Attorney General Jeff Sessions.

Fentanyl, 50-100 times more potent than heroin, is a major cause of the ongoing US drugs death epidemic. Until now, it has been mostly shipped to Mexico and the US from black market labs in China.

But Sessions warned that Mexican drug traffickers, who are behind most of the US heroin supply, are now setting up their own production sites.

"Fentanyl originally started mostly from China – a considerable amount has been shipped to Mexico and then enters across the border in some fashion from Mexico," he told a US-Mexico bilateral meeting on organised crime.

He added: "We are also seeing precursor chemicals in Mexico and manufacturing labs begin to develop in Mexico."

"So one of the priorities I would like to see us do is to nip that in the bud, stay very intensely focused on those laboratories, and make sure that it does not become a big problem in the future," AFP quoted him as saying.

Fentanyl is cut with heroin by dealers in a bid to maximise profits – achieving a strong blend of opioids at reduced cost.

However, the process is incredibly dangerous as a few grains of fentanyl can be deadly, even to experienced users. If the substances are not mixed consistently then any person consuming a fentanyl "hot spot" will overdose.

Fentanyl was connected to 20,000 deaths in the US last year, an almost 400% increase on two years previously. There were a total of 64,000 deaths by drug poisoning overall.

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President Donald Trump has declared the opioid epidemic a public health emergency, estimated to cost the US almost $80bn a year.

The crisis has its roots in over-prescription of opioid-based painkillers such as oxycontin in the 1990s, which pharmaceutical companies claimed were not addictive at the time.

As regulators got wise to America's growing opioid dependency and restricted prescriptions, many addicts turned to street heroin, which has in turn been contaminated with fentanyl.

The US has demanded that China do more to get a grip on illicit fentanyl exporters. But if large-scale production gets off the ground in Mexico, that may be the least of the administration's concerns.