What’s Taking Canadian Craft Cannabis So Long?

Micro-Cultivation and Micro-Processing Licences Were Designed to Boost Canadian Craft Cannabis. So What Happened? – LPC

Farm gate cannabis in Ontario will be announced in the coming weeks, according to one ex-Health Canada analyst. But that’s little comfort for Nova Scotia cannabis farmer Adam Webster. He and others in the Canadian craft cannabis industry are getting cut out and undercut. And he’s not sure why.

“I’d like to be able to sell straight to customers, either straight from the farm or at a farmers’ market,” said Webster, co-founder of Annapolis Valley Craft Cannabis.

“I feel as long as we pass the tests that Health Canada requires, what’s the reason not to? If it’s safe for the end consumer, I think we should be able to sell straight to them.”

Someone registered as Donald Webster received a Health Canada Micro-Cultivation licence in January 2020. That gave them the ability to sell to another LP for processing and sales. They had hoped to sell their cannabis at $5 per gram. That never happened, Webster said. The highest offer he received is $1 per gram and the lowest $0.20 per gram.

“When it’s sold at the NSLC (Nova Scotia Liquor Corporation) for $15 a gram, that seems like quite a discrepancy,” he said. He added that his family invested $80,000 to launch the venture – Health Canada’s “build first” policy meant everything had to be in place before they could apply. “As of right now we’ve made no income.”

Webster is not alone. These are the hurdles that many in Canadian craft cannabis are facing. And it’s disheartening.

Ex-Health Canada Analyst Feels the Frustration in Canadian Craft Cannabis

Many thought that craft cannabis would be like craft brewing. However, it’s not turning out that way. Small batch cannabis can’t sell directly to consumers, and it’s getting overlooked by retailers.

David Brown said he understands where those in Canadian craft cannabis are coming from. The ex-Health Canada analyst said that it’s part of the growing pains of the industry.

“I think it’s reflective of a lot of the frustrations I’m hearing from a lot of micros in the industry right now,” Brown said.

One key sticking point is THC content, he said. Micro-cultivators tend to grow their cannabis outside. Outdoor-grown cannabis is cheaper to grow and can contain more turpenes. But the THC content tends to be lower.

“One of the barriers for any cultivator to get into a provincial market right now is that provinces have a preference for products that are over 20 per cent THC,” Brown said. “There’s a perceived, or real consumer demand there. So if you have a crop that’s under 20 per cent, you might get less for it, because there’s an impression that consumers are going to want to pay less for that as well.”

As for farm-gate sales – Health Canada does nothing to restrict Canadian craft cannabis from doing it, he said. However, since the provinces are in charge of laying out retail rules, they have to be the ones on board. Brown implied there needs to be a system in place though to handle that.

“Nova Scotia hasn’t established a framework for that,” he said, though Ontario is on the verge. “But there is the potential for that down the road. I don’t think the provincial market in Nova Scotia is quite ready for that yet.”

There is also a push for farm-to-table cannabis tourism in Alberta.

Despite Clear Wins for Canadian Craft Cannabis, It’s a Hard Row to Hoe – LPC

There are winners in Canadian craft cannabis. Last year, VIGR Life Cannabis (VLC) received its micro-cultivation licence. VLC got its product onto local shelves in Regina in January.

But many end up selling their crops thousands of miles away from where they are grown. Webster said they have a deal to sell their cannabis for $1 per gram – to a processor in Saskatchewan. Northern Ontario-based Hearst Organic Cannabis put a deal in place with BC Craft Supply Co. weeks after it received its micro-cultivation licence.

That’s if they sell it at all. Webster said that unless things change, he can’t see himself staying in the industry for long.

“We’re going to give it at least another year, maybe two…. But if something doesn’t change within five years, I doubt we’ll still be doing this,” he said.

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This story was selected to provide analysis, insight, and perspective on current events affecting the Cannabis industry. Click here to see the original story published. www.cbc.ca