The price of cocaine, ecstasy, cannabis and other drugs is at an all-time low, clearly indicating that efforts to stem the spread of illegal drugs on Britain's streets are failing.

The data, based on a survey of more than 2,300 people last year, shows that cannabis resin sold for an average of £43 per ounce, down from 2004's figure of £45 - and a big drop from the 1994 average price of £120 per ounce. Even at this low price, the profit margin for the dealer remains high, at 169 per cent.

The annual survey of drug prices, to be released by the charity Drugscope this week, shows how prices remain low.

Cocaine, sold for around £44 a gram, is one of the less profitable drugs, with a profit margin of around 95 per cent.

Britain's continuing "pill-popping" culture, particularly in its clubs, is indicated by the falling price of an ecstasy tablet, which is usually bought for less than £3.

Amphetamines are also down in price, and cost an average of £9 a gram - yielding a 237 per cent profit margin.

Heroin was one drug that went up in price - from £38 a gram in 2004 to £58 a gram last year. Its profit margin more than doubled, to 152 per cent.

Illustrating the economies of scale underpinning the demand for drugs, dealers selling ecstasy tablets for less than £3 were still able to pocket £1.50 a pill.

There are a number of factors involved in what is rapidly becoming a "buyer's market", according to drugs counsellors. The decreasing purity of some drugs is one reason for the fall in prices, as dealers import drugs and then adulterate them with other, cheaper chemicals in an attempt to hang on to their profit margins.

Another more fundamental reason for the steady drop in prices is that traffickers are flooding Britain with illegal drugs, because demand has increased.

Home Office research shows that one person in 20 aged between 16 and 24 has used cocaine or crack.

CUT-PRICE HIGHS: How drug prices have fallen since 2000:

HEROIN: dropped from £70 a gram to £58

COCAINE: down from £65 a gram to £44

ECSTASY: fallen from £9 to less than £3 a pill

According to the Serious Organised Crime Agency (Soca), Britain is one of the world's most profitable narcotics markets for gangsters, despite a long-running "war on drugs".

Soca aims to stem the flow of heroin from Afghanistan and cocaine from Colombia. It estimates that up to 35 tons of heroin are brought into the UK each year.