Co-op News September 2019: Agriculture

expensive – with a CA$23,000 (14,100) regulatory
fee, a $3,000 (£1,800) application fee and
a $1,700 (£1,000) security fee. In response, industry
specialist Grow Tech Labs and business incubator
Victory Square Technologies have launched
a cannabis co-op to help small producers in the
province navigate the legal terrain.
“Hopefully the craft cannabis
cooperative will be a brand
identity that people will
look for and will benefit all
of our farmers. This is going
to help farmers who are
hoping to diversify”
To cut costs and red tape, growers in the province
are sharing land; the Kootenay Outdoor Producers
Co-op is planning a demo farm, where it will expand
into edible and fibre production, with plans to take
its model to 60 more farms.
Legalisation has brought bigger players from
Canada’s co-op sector into the field, with Calgary
Co-op, one of the largest retail co-ops in North
America, forming a Co-op Cannabis division,
operating separate stores selling dried cannabis,
cannabis oil, and accessories.
Growers in the US are also drawn to the co-op
model; in Pioneer Valley, Massachusetts, the craft
marijuana co-op has been included as a licensing
category by regulators – although some town
councils have imposed a moratorium on growers.
Among those formed to take advantage of the rule
is Farm Bug Co-op, which is lobbying legislators to
ensure that co-ops under licence must abide by the
seven co-operative principles.
“We were concerned about some big company
coming in and calling themselves a co-operative,”
Marty Dagoberto of the Northeast Organic Farming
Association told local news site Valley Advocate.
“I feel co-ops are the way of the future as far as
a democratically controlled local economy goes.”
And in Conway, John Moore and Lisa Gustavsen of
Roaring Glen Farms are looking to set up a cannabis
co-op. “There are so many farmers who are having
to leave their farms, they can’t make a living,” they
told local news site Greenfield Recorder. “This
could be a magic bullet for all the abandoned farms
and dairy farms in the western part of the state.”
But cannabis co-ops face another hurdle: where
to put their money, with many players in the banking
sector unwilling to help because they are subject to
federal law, which maintains a ban on the drug.
This has prompted cannabis businesses to turn
to credit unions, although they often face a waiting
list before being accepted as members, and must
go through costly background and licence checks.
Last month, the chair of regulator the National
Credit Union Administration said credit unions
won’t be sanctioned for serving cannabis-related
businesses in states where the drug is legal – with
Congress considering legislation that would allow
banks to take on cannabis-related customers.
US Treasury figures in 2018 found 375 traditional
banks and 111 credit unions accepting business
from the cannabis industry. This number is growing
– Treasury figures in July found that in the first half
of 2019, the number of credit unions servicing
cannabis businesses had risen by 20%.
But it’s still unfamiliar territory. Last month,
Alaska’s Credit Union 1 announced it was ending
a pilot project which had seen it work with four
cannabis businesses. Chief executive James
Wileman said businesses could not continue the
programme beyond a pilot phase without liability
coverage, adding that the pilot had not performed
as well as expected.
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