Mexico is on the verge of becoming the world’s largest legal cannabis market. Some experts estimate that by the end of April everything will be set in stone.
While I have taken the time to explain what this would mean for the average consumer & potential business owner– there is one group of people that we have not taken a look at.
I’m talking about the cannabis farmer of course!
You see, Mexico has international clout for cannabis. Many people think that cannabis came from Mexico, when in reality it was probably brought over by settlers way back when.
Mexico does have a reputation for weed because of the sheer volume it used to sell, nowadays – the weed produced in Mexico has fallen out of favor of the average consumer. This in turn created an issue for those who have been cultivating the plant for generations.
Now with legalization looming – these cannabis farmers are facing new challenges.
Maria is mother and lives in Sinaloa. She is 44-years old and have been cultivating for cartels for a long time. These days, her harvests are sitting in a wooden shed waiting to be picked up.
“It has never happened to us where we harvest and have it (stored) in sacks,” said María who only goes by that name out of fear of cartel reprisals.
The cartels have long began shifting their drug cultivation away from cannabis and more to heroin or fentanyl, since Americans have the appetite for those drugs and because cannabis in the US out performs whatever the cartels can cook up & ship.
In many cases – cartels are preferring to grow State side now, which allows them to increase the quality of the cannabis.
In order to freight cannabis, they usually spray it with chemicals and compact it to the point of destroying the terpene and cannabinoid profiles. This is why “ditch weed” is so “ditchy”.
Price Cuts for Farmers
There are many generational cultivators like Maria who are worried about legalization. This is because once legalized, they will become targets by the government to comply.
While the Mexican law is expected to provide some provisions for these communities, the bulk of the industry will be in the hands of investors both foreign and national.
Cultivators in Sinaloa say that over the past five years the price per kilo has been cut in half and a reduction in demand has also been an issue. This is why half of Maria’s crop is sitting on her land.
However, even though cannabis sales have dipped – Mexico remains the US’s largest cannabis supplier from outside of the US.
Farmers start switching crops
One effect legalization has had on cannabis farmers was the shifting of their crops. For starters, some farmers are taking better care of their crops, growing strains with higher value.
This is good to bring up the overall quality of “street weed” as they call it here in Mexico. Other farmers started integrating opium poppies to help supplant their income which was affected by US legalization.
This could also be a slight reason why there was an influx of heroin and fentanyl in the US – since cartels increased production of these substances.
For example, cannabis can fetch farmers roughly $25 USD per kilo, whereas opium can produce thousands of dollars when converted to opium gum.
On a side note – I’ve had some of that opium gum when I was in Oaxaca and it’s not bad at all.
Farmers are at a loss on how they will deal with the inevitable legalization that could happen as soon as the end of the month, or as late as the end of September.
In the meanwhile they remain in a type of limbo.
What will happen post legalization?
There’s two main options that can play out. The first being that these mountain communities will enter into the legal marketplace.
There are talks about making it easier for these rural communities to gain access to the legal system. The problem however is that even if it is going to be legal [in those regions] the cartels will still control the trade.
You see, the cartels control virtually everything in these regions. Hell, the carels control avocado production in Michoacan, they control the car trade in Tampico – they have their finger in virtually everything.
Legalization is meant to muscle out the cartels, but who is to say that the cartels won’t simply swallow up these legal farms?
While the marines do take periodic sweeps of the areas – they simply don’t have the manpower to deal with cartels in the area.
Some Farmers are Interested in legal cannabis
There are farmers that are eager to venture into the legal trade – yet as we previously mentioned, they will still need to play by Narco rules.
Unless the government creates some sort of protection scheme for these farmers, they will still need to pay tribute and sell to the “lord of the land”. If not, it could mean a violent and bloody end not only for the farmer – but the whole family as well.
Where will Mexico’s Weed Market be the best?
These rural areas will be difficult to convert to the idea that politicians are aiming for because of the aforementioned issues with cartels. Within the cities however, there’s a bit more control.
This isn’t to say that there will not be drug dealers trying to extort money from legal cannabis businesses – mark my words, it will happen!
This will probably only happen to the “smaller fishes” as the Mexican government will not allow the same to happen to the bigger investors. You know, those who will invest in massive farms and implement vertical integration – creating jobs and money for Mexico.
If the cartels go after – Hemp Meds, for example, one could easily expect the Marines to respond. However, if it’s just some Shmoe called Jose with his dispensary and grow op – I don’t see a lot of protections going his way, at least not yet anyway.