In Canada, it will be Wine, Beer or Weed

Wineries, grape growers watching as lawmakers legalize recreational cannabis

by Peter Mitham
A pro-cannabis rally in Canada, where lawmakers approved a law legalizing recreational use of marijuana. Photo source: Wikimedia

Ottawa, Ont.—Recreational cannabis is set to roll out to markets across Canada this year following a vote by the country’s senators this week that sets the stage for weed’s legalization, effective Oct 17.

Known as the Cannabis Act, the legislation gives the country’s provinces and territories eight to 12 weeks to prepare for sales of recreational marijuana, which will be sold through government-licensed retailers similar to wine and other forms of beverage alcohol. “We’re now focused on developing the regulations and supporting policies for the implementation of our provincial regulatory regime,” stated Mike Farnsworth, British Columbia’s solicitor general and minister of public safety.

Many in the wine industry see cannabis as an opportunity.

Liquidity Wines of Okanagan Falls, for example, sponsored a multicourse, small-plate dinner with Los Angeles chef Chris Sayegh prepared in Vancouver this spring “starring local ingredients enhanced by THC and CBD extracts.” Liquidity’s wines accompanied the meal.

Similarly, Poplar Grove Estate Winery owner Tony Holler is confident enough of cannabis’ potential to launch Sunniva Inc. He plans to begin production at a 700,000-square-foot greenhouse north of Oliver, B.C. next year.

Constellation Brands Inc., one of the largest U.S. wine producers, made an early play in the market by investing nearly $200 million in a Canadian cannabis company in 2017.

Despite the enthusiasm, Elaine Vale, director of legislation and strategic initiatives with the BC Liquor Control and Licensing Branch, said at a conference organized by Law Seminars International prior to the Vancouver International Wine Festival, that cannabis is distinct from wine. “They are different products and they’re not necessarily going to be treated the same,” she said.

A member of the province’s cannabis secretariat, James Mack of the BC Ministry of Agriculture, delivered a similar message to a cross-commodity group of farm organizations shortly afterwards. A federally regulated narcotic at the time, Mack said cannabis didn’t qualify for monies under existing agriculture support programs nor could growers claim farm class status for producing acreage.

“We actually want the tax revenues out of cannabis,” Mack explained. “We don’t want to give it the same incentives as farming,”

Moreover, while grapes require significant processing before they become wine and become subject to liquor laws, cannabis is quite literally there for the picking. It therefore requires tighter controls that prevent minors from accessing it, let alone finding it appealing. (One of the final issues lawmakers in Ottawa had to resolve, for example, was whether or not to allow companies to produce cannabis swag such as hoodies, hats and cell phone cases with their names and logos.)

“Grapes don’t pose a threat in of themselves. The better analogy is liquor in chocolates,” Mack told farm groups this spring. “If you’re a chocolate manufacturer and you’ve got a chocolate liqueur line, you actually get licensed for the use of liquor in that product.”

While tastings and sales of wine, beer, cider and spirits have been allowed at B.C. farmers’ markets since June 2014, the prospect of cannabis sales at the popular community venues isn’t likely until the product becomes a mainstream part of communities. How soon this will happen is another question, as many are considering bylaws restricting where sales can occur.

Farnsworth recognized the issues in announcing B.C.’s plans to develop cannabis regulations.

“The date set by the federal government for cannabis legalization will just be the beginning,” he said. “The legalization of cannabis is complex, and the province is committed to monitoring the implementation and making any adjustments necessary to meet our provincial goals. This includes continuing to engage local governments and Indigenous governments and organizations beyond legalization, to ensure specific interests and concerns are addressed.”

The speed with which the shift has taken place has been quick for Canada, which has banned recreational use of cannabis since 1923.

Ottawa legalized the cultivation of industrial hemp in 1998 and access to cannabis as a pharmaceutical the following year. Additional changes set the stage for commercial production of medicinal weed in 2013, prompting municipalities to figure out how to regulate dispensaries. It took another two years for cannabis oil and fresh marijuana buds to become legal.

By comparison, recreational cannabis became legal in just two years, with the interim characterized by a surge of investment in production facilities. The licensed producers are all indoor growers, as outdoor production is not allowed in Canada. An estimate by the B.C. farm paper Country Life in BC earlier this year estimated the potential acreage among licensed producers at 228 acres.

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