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Dec. 16, 2019 | Monday
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Cannabis growers in Niagara double in one year
A cannabis plant at Tweed Farms. (Jill Troyer/Niagara Now file photo)

By any measure, the business of growing cannabis in the Niagara Region has doubled in the last year.

The number of commercial growers has gone to six from three; the number of square feet to two million from one million, and the number of employees in the industry is growing rapidly.

Since cannabis was legalized, Statistics Canada reports that cannabis-related jobs grew substantially, by 266 per cent, and Ontario has the lions’ share of those jobs.

“The highest level of cannabis-related employment was in Ontario, an estimated 5,700, representing more than half of the national total. Ontario is the province with the largest concentration of licensed producers,” according to a Statistics Canada report. 

And Niagara has “two of the three largest producers in Canada. The third is in Leamington,” says Blake Landry, manager, economic research and analysis for the Region of Niagara.

Tweed Farms in Niagara-on-the-Lake was here first. It started growing medical marijuana in NOTL in 2014, and is still the largest.

Jordan Sinclair, vice-president of communications for Canopy Growth Corporation, which owns Tweed, says the operation in NOTL has expanded from the “35,000 square feet it began with, to one million square feet, and is a major part of our overall production capacity.”

Canopy Growth purchased NOTL winery Coyote’s Run for $10 million in May, and Sinclair says “it was a good business decision” to buy the winery, which is adjacent to Tweed Farms. “Canopy is looking for partners to use the property to produce wine,” he added.

For now, Sinclair says, Canopy has a “contract with a third party to take care of the vines.”

But Tweed Farms is no longer an oddity in the area, having been joined by five other producers so far, with more seeking to grow cannabis in the region. An outdoor cannabis operation has been proposed on Airport Road in Niagara-on-the-Lake, though formal approval has not yet been requested.

Landry says the Niagara Region is attractive to licensed producers. “We have experience and expertise, as well as significant existing greenhouse facilities. We also have a tradition of producing food and beverages. There is a very high concentration of horticultural support here, we have capacity, and talent.”

Niagara’s microclimate is also attractive to producers, since it allows them to save on energy costs, he says.

One of the new operators in the region is Aleafia Health, in Grimsby. “The Niagara Region is blessed with a workforce with tremendous experience in greenhouse horticulture, along with a unique climate that has made the decision for Aleafia Health to call the region home an easy one,” Aleafia CEO Geoffrey Benic said in a statement.

Aleafia has a 160,000-square-foot greenhouse ready to go, just waiting on final approval of its licence from Health Canada.

“We have a core team in place already and they are working at some of our other facilities and will move over to Grimsby when it’s licensed. When we get the licence, we would ramp up hiring immediately and build up to the full team in five to seven weeks,” says Nicholas Bergamini, vice-president of investor relations for Aleafia. “We’ll employ 80 to 100 people there.”

For Landry, the growth in Niagara is unprecedented. “I’ve never seen this kind of growth in a sector, this just boomed.”

But this is just the beginning, he says. “Given the rapid pace that this industry is evolving, I suspect that these statistics will change significantly over the next one to two years.”

The economic impact is expected to come from more than just growing cannabis. ”The real economic opportunity will come from processing and services,” he says. “That could include greenhouse technical companies, electrical controls and various types of expertise. The wine industry has the highest value add of any agriculture industry, and cannabis may rival that.”

There are already several cannabis industry players in Niagara, including Avid Growing Systems Inc., which provides turn-key cannabis cultivation systems.

Another, Hamill Agricultural Processing Solutions, is developing products to use to process cannabis, such as small scale trimmers and extractors. 

And Niagara Falls is home to the Grow Up Cannabis Conference and Expo,  which is the first cannabis industry conference and exhibition in Canada. This year it will be held from Sept. 12 to 14, and organizers expect 5,000 people to attend.

Landry predicts the next wave of growth will be in cannabis edible products, saying “cannabis edibles and beverages are not legal yet, and present a big opportunity for Niagara. It’s so new at this time, that we are only starting to see the various products and applications that are being developed with cannabis ... this is a nascent area of the industry. Once edibles become legal, we’ll see.”

Edibles will be legally available by mid-December. Landry says that there are companies actively “investigating production of edibles, and looking to set up facilities here.”

Sinclair says Canopy Growth has no plans to produce edibles at Tweed Farms in NOTL. Production of cannabis products will continue to be centred at its’ headquarters in Smiths Falls, Ont.

Mishka Balsom, president and CEO of the Greater Niagara Chamber of Commerce, also notes there’s “a huge interest in edible cannabis and refined liquids” and that may have a significant impact on tourism in the region. “But it’s so new, we have to wait and see how it will develop. There are high risks and great opportunities.”

Balsom notes “it’s a new industry, and when it grows so fast, there are growing pains.”

Those growing pains include complaints from residents who live near the new or expanded facilities about the smells coming from greenhouses growing cannabis. In Pelham the expansion was so dramatic council imposed a one-year moratorium on any additional facilities in March 2019.

In June, NOTL town council extended an interim cannabis bylaw prohibiting new cannabis operations and expansions within the municipality for one more year.

Coun. Wendy Cheropita says the town’s cannabis committee, after extensive consultation and information gathering, has drafted a new cannabis bylaw that “would prohibit any outdoor cannabis growth in NOTL, and limit any new greenhouses to industrial areas.”

The committee wants to be sure the bylaw “protects our existing fruit and grape industry, as well as our beautiful landscape,” Cheropita says.

The bylaw has been sent to staff for comment and Cheropita says there will be a “public open house in September, where we’ll make a presentation and invite public comment.”

A staff report is expected to be presented to council’s committee of the whole on Sept. 9. A notice of motion by Coun. Stuart McCormack outlines details of the proposed new bylaw, including extension of the prohibition on new operations until July 2020.

One licensed producer in Pelham, CannTrust, recently ran afoul of Health Canada, violating its licence conditions by growing more plants than it was licensed for.

Since then, its CEO and board chair have been fired, stock prices have plummeted, and its inventory has been put on hold.

In a statement, Health Canada said that consequences could range from “compliance promotion and awareness, which are intended to educate and prevent non-compliance, up to measures intended to correct non-compliance or address a public health or safety risk, such as the issuance of a warning letter, suspension or cancellation of a federal licence, the issuance of a ministerial order, or the issuance of administrative monetary penalties (up to $1 million).”

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