Big Weed: Why Legalization Isn’t Necessarily a Boon For Craft Cannabis Producers

Article by Brent Bambury, CBC Radio

Big weed: Why legalization isn't necessarily a boon for craft cannabis producers Cannabis columnist Lester Black says Washington state offers a cautionary tale CBC Radio . Neil Closner, CEO of MedReleaf, poses at the company's Markham, Ont. growing facility in 2016. This week, Aurora Cannabis Inc. announced a friendly deal to acquire MedReleaf, creating a company capable of producing more than 570,000 kilograms of marijuana per year. (Nathan Denette/Canadian Press)

When Canada legalizes marijuana later this summer, the big players say they will be ready to do business — and this week, one of them got much bigger.

Aurora Cannabis announced on Monday that the company will buy medical marijuana firm MedReleaf for $3.2 billion to create an industrial giant with a valuation of about $7 billion.

The market isn’t even open, but mega-producers are looking for efficiencies, aiming to deliver a product at minimum cost for maximum profit.

That means Canada’s micro-producers are looking at a tight market.

Brian Taylor is a member of the Craft Cannabis Association of B.C. and a small grower with a lot of experience. He considers himself a “craft” marijuana producer — and he fears that could put him at a disadvantage.

“I think that the small grower, even the medium grower, is really subject to those kinds of unfair competition from the large producers who can afford to take a loss over a period of time to control the market,” Taylor told Day 6.

Taylor is betting there will be a role for Canadian small producers alongside the mega-farms. But when he looks south to Washington state, where marijuana has been legal since 2014, he worries.

Read the full article here.

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