I'm not a trader, but I will say that this is simply wrong. Trading should always be more profitable than anything, but not at a ludicrous amount.
If smuggling goods from a market is more profitable than trading, then why would anyone trade?
It would completely kill trading, and all the traders would go to smuggling.
What the backwards thinking batman!?!?
SMUGGLING should always be more profitable than trading!!!
Why else would anyone SMUGGLE!!!
If I buy bananas in south america and sell it in the US for the same profit per KG as I get from smuggling cocaine, then why would I take the RISK of SMUGGLING cocaine in the first place???
Bananas = trade
Cocaine = smuggle
Which one do you think should give you the most profit?
What do you think happened to import of alcohol in the US during the prohibition period in the 1920's? You think the price of alcohol remained constant? No, it skyrocketed as a result of being illegal, and thus generating a massive demand. So the mafia made massive profits from doing smuggling runs. It was risky, but it had a heck of a reward associated with it.
If I buy drugs in one station where it is legal then the sell price at a station where it is illegal (and wanted) should easily be twice as high and net me some good profit. Why else would I run the risk of smuggling in the first place? The WHOLE point of smuggling is to bring large cargo of illegal wares into a place where they are wanted for much higher profits than the regular market offers. Otherwise all that smuggled alcohol that went into the US during prohibition period could have just been sold in countries where it was legal, right?
Smuggling needs to be vastly improved in this game, and there needs to be a significant differentiation between smuggled trade goods (actual smuggling) and salvaged / scooped items. Smuggled trade goods have an investment cost associated (cause you have to buy the wares somewhere) while salvaged / scooped items, which may be illegal, have no investment cost since you literally picked it up for free.
The risk of smuggling should also be increased. Not only should you risk scanning at stations, but also interdiction and scanning during supercruise. Furthermore, the outposts should also be subject to patrols that actively cargo scan. Especially if it's a system that has had a lot of smuggling going into it. A natural response of the background simulation would be to increase the amount of NPC ships that perform scanning... and if players smuggle less again due to the active scanning then price will begin to rise again and thus make it attractive once more to smuggle into that system.
The whole reason I don't smuggle in this game is simply because the profits for smuggling is completely broken and leaves zero motivation to put myself at the risk of getting bounties since the rewards are minimal / non-existent.