Large-scale cannabis grow room operated by Hexo Corp. in Quebec, Oct. 11, 2019. Hexo is marketing a licensed dry cannabis product for $4.99 a gram to compete with illegal sales. (The Canadian Press)

‘B.C. bud’ cannabis still underground, John Horgan hopes to rescue it

Legal marijuana mostly from out of province, not selling well

First of a series on the preservation of a ‘craft cannabis’ industry in B.C.

In the bad old days, B.C. used to supply half of Canada’s marijuana, export it to the United States by the hockey bag, and bring home a bong-full of blue ribbons for its exotic “B.C. bud” strains from international Cannabis Cup competitions in Amsterdam.

Premier John Horgan argues that this history is the main reason why legal marijuana has fizzled so far in B.C., a year into Prime Minister Justin Trudeau’s bold legalization experiment. Horgan’s government is moving to take over the “economic development” part of legal cannabis from Ottawa, because its ponderous Health Canada licence system for growers is working great for mass-market producers in Ontario and Quebec. And it’s killing B.C. bud.

The Central Kootenay around Nelson B.C. is ground zero for Horgan’s experiment, economic development grants to subsidize and guide illegal growers from the dark side to the light. The $676,000 project is funded by the Ministry of Social Development and Poverty Reduction, and administered by Community Futures Central Kootenay.

Energy Minister Michelle Mungall, who holds the Nelson-Creston seat for the NDP, was quoted in a low-circulation press release, applauding the grant’s potential to help growers navigate the federal-provincial-municipal regulations. Kootenay West MLA Katrine Conroy, another NDP cabinet minister, has expressed her concern that Canada’s wave of stock-market-backed mega-producers is a grave threat to her local economy.

Social Development Minister Shane Simpson says this is his ministry’s first cannabis-related business venture, and it was a grassroots idea. If it works for the Kootenays, it could work for the Okanagan or the Sunshine Coast, Simpson says.

“We’ve seen what’s happened with the craft beer industry in British Columbia,” Simpson said in an interview with Black Press. “It’s exploded and become an important part of the local economies in communities right across the province. It’s possible that there could be that same craft aspect to the production of cannabis. “Everybody talks about B.C. Bud and the reputation it has, so if we can build a craft industry that’s legal, that’s regulated appropriately, then that’s a good thing.”

PART TWO: Craft cannabis growers wade through bureaucracy

PART THREE: Province cracks down, prepares for edibles

RELATED: B.C. finance ministry downgrades cannabis income

RELATED: Hexo starts selling cut-rate cannabis in Quebec stores

B.C.’s main legal effort is a monopoly wholesaler run by the Liquor Distribution Branch, with a monopoly online store and a scattering of government-owned retail stores, a few licensed private retailers and a ragtag of unlicensed stores and private dealers. Some insiders estimate that the “grey market” and “black market” ragtag still holds 80 per cent of the B.C. market.

Large-scale licensed national producers, the Budweiser and Coors Light of cannabis, have been noted for missed targets, regulatory cheating, and a shortage followed by a glut of overpriced product, some of it getting mouldy sitting in the warehouse.

Horgan says he’s well aware that most of the product Health Canada has made legal for recreational sales is from other provinces. And he recalls telling the Trudeau government well before legalization that B.C. would make its own way on business development.

“The federal government said ‘we’ll take care of economic development’, and we just disagreed with them on that, and we continue to disagree with them on that,” Horgan told reporters at the B.C. legislature Nov. 28. “We have in B.C. a legendary quality product, and that’s not making its way to the legal market.”

The jokes about the B.C. NDP somehow losing money selling weed are no longer funny. It’s a fact. In her second-quarter budget update, Finance Minister Carole James reported that forecast for B.C. Liquor Distribution Branch income has been lowered $18 million “due to the delayed rollout of private and public cannabis stores and lower-than-anticipated demand.”

Federal excise tax from cannabis, the dollar-a-gram first take for recreational product, is split three quarters for the province and one quarter for Ottawa. The latest forecast downgraded B.C.’s share for the current fiscal year from $38 million to $8 million. Policing and other costs are coming in higher than budgeted.

Horgan acknowledges that the problem is the black market is still here, and the “grey market” that worked through medical dispensaries and compassion clubs, is greatly endangered. One disadvantage is price, with Statistics Canada estimating that legal cannabis is running close to $10 a gram, while illegal product is selling for half that.

Quebec-based Hexo Corp. has a plan for that, and it’s more bad news for “craft cannabis” in B.C. Hexo has launched a budget product for national sales called “Original Stash.” It’s only sold in the old-school 28-gram or one-ounce bag, at $4.99 a gram.

Next part: A craft cannabis grower navigates the regulatory system.


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

BC legislature

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Comments are closed

Just Posted

Morning Start: Dogs can smell cancer

Your morning start for Tuesday, July 7, 2020

Neighbours raise concerns about proposed housing development in Salmon Arm

Objections to 11th Street SE plans include increased traffic, diversion of creek, loss of greenspace

Salmon Arm Council pleased with plans for Habitat for Humanity housing project

Twenty-unit building, mainly for 55-plus seniors, in the works

Salmon Arm pool to reopen for limited programming, not drop ins

Strict sanitization protocols in place including one-hour closure between scheduled swims

Vehicle incident stalls traffic on Highway 1 east of Salmon Arm

Drive BC reports road closed, assessment underway

B.C. records 31 new cases, six deaths over three days due to COVID-19

There are 166 active cases in B.C., 16 people in hospital

Shuswap history in pictures: Three-legged race

Race captured on a glass plate negative

Two dead after weekend crash on Highway 1 near Revelstoke

The driver and passenger of one vehicle died at the scene

96-year-old woman scales B.C. butte with help of family, friends

‘I did as I was told and I enjoyed every minute of it’

Parallel crises: How COVID-19 exacerbated B.C.’s drug overdose emergency

Part 1: Officials say isolation, toxic drug supply, CERB, contributing to crisis

Canadians with disabilities disproportionately hit by COVID-19 pandemic

More than four out of 10 British Columbians aged 70 and up have various disabilities

Camping offers a great pandemic escape, for less money than you might think

But for many first-timers, knowing what to bring can be a challenge

Most Read