Cannabis cooperatives arise as small producers seek to compete



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VANCOUVER – British Columbia may be famous for its flora, but some say that Canada's new marijuana legalization structure is excluding small-scale producers with established know-how.

A movement is growing in the province to solve this problem with a common idea: cannabis cooperatives.

"Some may argue that we lost our place to Ontario or Alberta based on the number of licensed producers based in those provinces," said Barinder Rasode, CEO and co-founder of Grow Tech Labs, a cannabis business accelerator.

"We are very focused on ensuring that B.C continues to be a world leader in the field."

Rasode, who also formed the National Institute of Cannabis Health and Education, said he traveled around the province talking to small farmers who grow marijuana long before legalization.

She has heard common complaints that entering the legal market is very expensive and the regulations are very complex, including barriers such as a production limit of 195 square meters and non-specific safety authorization criteria.

"There's a myth out there that these legalization producers are sitting in cash bunkers," she said.

Grow Tech Labs and Victory Square Technologies have launched a cannabis cooperative this month, which will begin with a provincewide consultation of small producers and processors, Rasode said.

Grow Tech will provide initial funding, but it will be up to members to choose an executive and define their roles according to statute and governance model.

"Having a cooperative-based model in which there is collaboration not only in success but in risk mitigation and in the learning outcomes of each other is a model that worked in Canada and definitely in BC with other commodities like wheat and cranberries," said she. .

Others have begun to build cooperatives and identified some obstacles.

The Cascadia Agricultural Cooperatives Association is working to create a medical marijuana cooperative that extends beyond producers and processors to include consumers and retailers.

Founder Joel Podersky said the model would include small and medium producers, patients and dispensaries.

"Collectively, they form a marketplace, supplying both supply and demand."

The idea would be to prioritize quality over quantity and provide members with shared access to business development resources such as accounting and legal support, he said.

Current regulations prevent this market from operating independently. All distribution must pass through the B.C. Beverage Distribution Branch.

In Kaslo, Todd Veri said he was inspired to start Co-op Kootenay Outdoor Producers after reading a report from the federal cannabis task force that said there would be room in the market for small producers. There is a long history of local marijuana production in the Kootenays, he said, and he felt that a cooperative model would maintain the economic benefits in the community.

The cooperative has 35 local outdoor properties aligned and is reducing costs by using a "community garden" model in some producers where a single piece of land is used for cultivation.

They also have a 460-square-foot shared nursery in Salmo ready to go, but Veri said he is worried about the time it is taking for Health Canada to process the application he sent in December.

"Our biggest concern now is that we expect the license application to take from 60 to 90 days," he said.

"If they take 120 or even 150, it will really impact whether our farms will be licensed this year."

Beginning Jan. 31, Health Canada reported that it had received 83 micro-crop license applications, including 54 for cultivation only, seven for processing alone and 22 for both.

One company in Canada received a micro-cultivation license. Health Canada does not have the name of the company but said it is in B.C. and had already stopped a medical marijuana cultivation permit.

Each property requires its own license, Veri said, which comes with a regulatory fee of $ 23,000, a security fee of $ 1,700, an application fee of $ 3,000 and other costs.

He is betting on the lower costs of outdoor production to make up the difference, which is why timing of the process is important.

Some other governments formally recognize the cooperative model of cannabis. In Uruguay, 15-45 growers can grow up to 99 plants together and Massachusetts has a "handmade marijuana cooperative" license that limits cultivation to a total of just over 9,000 square feet.

"The regulations here do not have a separate category for cooperatives, as they do in those other jurisdictions, but our regulations also do not prevent that from happening," said Rielle Capler, a postdoctoral researcher at the BC Center. on substance use.

Capler, who is also a co-founder of the Canadian Association of Cannabis Retailers, said the cooperative model proved to be "robust" for agricultural products, so it is a promising avenue for cannabis as well.

But that does not remove all the barriers small farmers face. At the local government level, for example, legal producers need to be properly zoned and October municipal elections mean that some new councils are still updating themselves on the subject, causing delays.

Many small producers were approached by larger companies, aware of the obstacles they face, she said.

"There is a phenomenon of larger companies coming in and swallowing the smaller ones and saying," We're their only way to get to the market. "But by pooling resources and working together in cooperation, these small farmers and businesses could remain independent with this structure ".

Capler said these producers just want to preserve what was already working.

"There was a pre-existing illegal market and it was thriving and working for many people in B.C."

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