As regulations were released Wednesday outlining the finer details of what cannabis legalization will look like, craft cannabis growers are preparing for what they are calling the “second wave” of legalization.
The Liberals’ Cannabis Act, Bill C-45, received Royal Assent last week, and will become law on October 17. To be included in the new licensing regime announced at a press conference this morning are regulations opening up the recreational cannabis market to small producers, including outdoor farms.
Health Canada’s regulations will allow licensing of micro producers (with a maximum canopy of 200 square metres), and micro processors (of up to 600 kilograms per year), as well as cannabis nurseries. Additionally, there’s no limit to the number of micro licenses one person can hold, opening the door to cannabis co-ops across the country.
While it’s still unclear whether micro producers will be permitted farm gate sales, those with a micro-processing licence will be able to wholesale to provincial control boards or another Health Canada approved processor.
Mathew Columbro, president of cannabis consultancy Vindica, says, “The second wave of legalization will be hugely disruptive for licensed producers, allowing the existing mature craft cannabis market to finally be licensed.”
Also, while the government’s stated goal is to eliminate organized crime in cannabis, they’re not completely eliminating those with past criminal convictions from participating in the legal cannabis market. But officers and directors of companies, as well as master growers, must receive security clearance from the feds.
Columbro sat down with NOW to offer some insights into the new regs.
On what the new rules will mean for craft cannabis in Canada
Columbro says that “craft growers and processors will finally have an opportunity to bring their expertise and products to the marketplace.” And “while cannabis-infused products won’t be available right away, the regulations will provide craft growers and new entrants an opportunity to participate in the legal market.”
On the future of edibles in the legal market
Health Canada will be developing rules with respect to cannabis-infused food and beverages within a year from legislation, but existing cannabis companies, says Columbro, “have already begun to secure existing brands from Canada and the U.S. hoping to build on existing brand recognition.”
On the risks to craft cannabis companies looking to enter the U.S. market
Being denied entry to the U.S. is currently a huge issue for Canadians who consume cannabis, says Columbro. Those who participate in the cannabis industry may face a similar issue. As Columbro notes, “Cannabis is illegal under U.S. federal law.” And “although medical cannabis is already legal at the federal level in Canada, industry participants who may be travelling to the U.S. for business purposes could be denied entry at the U.S. border.”
On opportunities for existing farmers to expand into cannabis
According to Columbro, it’s already happening. “Many farmers are seeking an alternative cash crop. I have personally spoken with farmers growing tobacco on a small scale who are seeking to replace their current crop with cannabis, which offers greater returns. As well, community-supported agriculture farms are looking to grow cannabis as a cash crop to subsidize their organic farms.”
On the meaning of the “second wave” of legalization
Columbro says that allowing the licensing of craft cannabis producers will plant the seeds for “a diverse eco-friendly industry.” And “thanks to years of advocacy, we are finally starting to get legalization right.”
This interview has been edited and condensed.
Lisa Campbell is chair of the Ontario Cannabis Consumer & Retail Alliance, Chief Marketing Officer for Vindica Cannabis Company and Cannabis Portfolio Specialist at Lifford Wine & Spirits.
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