Canadian Marijuana Surpasses Wheat as Biggest Crop (Update2)

Theophilos Argitis
Bloomberg
Last Updated: September 30, 2005 14:20 EDT

Sept. 30 (Bloomberg) � Canada's marijuana dealers are converting suburban homes and abandoned warehouses into pot farms, creating a C$10 billion ($8.5 billion) market that's three times the size of the nation's biggest legal crop, wheat.

Cities such as Vancouver, Montreal and Toronto may each have as many as 20,000 pot factories according to some estimates, said Rich Baylin, former national coordinator for the Royal Canadian Mounted Police.  Cultivation is rising because penalties are often one-eighth those in the U.S., and Canadians' acceptance of pot has risen.

"This is a scourge on our communities and a danger to our children," Liberal Party lawmaker Jim Karygiannis said following a raid on a so-called grow-operation in a bungalow about 100 meters (109 yards) from a Toronto elementary school.

The "grow-op" business has created a rift with the U.S., where police say much of the weed is sold.  Efforts by Prime Minister Paul Martin to decriminalize marijuana are a bigger threat to U.S. relations than the softwood-lumber dispute, according to a Compas Research poll of 146 Canadian chief executives in March.

"The U.S. is taking the border a lot more seriously than in the past," said Tom Riley, spokesman for the White House Office for National Drug Control Policy.  The increase in Canadian marijuana production risks harming all trade between the two countries, he said.

Almost half of all adult Canadians smoked pot at least once in their life, according to a survey last year by Health Canada.  The same proportion support decriminalization of possession, compared with a third of their U.S. counterparts, a November Ipsos-Reid poll found

'Organized Crime'

While U.S. growers who cultivate 1,000 or more plants face a minimum of 10 years in prison, their counterparts in Ontario, Canada's most populous province, get about 18 months, according to government figures.

"We know the volume of these grow operations is growing," said Jack Ewatski, president of the Canadian Association of Chiefs of Police.  "That leads us to believe this is an enterprise that organized crime groups are looking at as very lucrative with very low risk of any meaningful consequences."

The RCMP's Baylin said estimating the number of grow operations in the country is like "guessing the unknown."  Police estimates on the size of the harvest are based solely on seizures, which have risen eightfold since 1993 to about 1.6 million plants this year.

Marc Emery

Pot stories have been a staple of newspapers such as the Toronto's Globe and Mail and the Vancouver Sun, covering drug busts and the fight by legalization activist Marc Emery to avoid extradition to the U.S.  He faces life in prison if convicted after a July arrest for selling marijuana seeds.

Grow operations across the country are producing strains of the drug with two or three times as much THC, a psychoactive chemical, as marijuana from Mexico, the biggest supplier to the U.S., according to the U.S. Drug Enforcement Agency.  Police last year raided a grow op north of Toronto that filled a three-story building once used as a brewery by Molson Inc.

Canada's law-enforcement agencies may have inadvertently helped build the industry by pursuing importers in the 1980s, Simon Fraser University criminologist Neil Boyd said in an interview.

"One of the consequences of the success police had is that the import-export nature of the business was replaced by domestic production," Boyd said.

'Skunk-Like Smell'

Residential marijuana operations have become so common that real-estate agents offer homebuyers advice on how to avoid them.  Tell-tale signs include covered windows, a "skunk-like" smell outside and bright lights inside the home, according to a guide from the Winnipeg Real Estate Board.  The group posts the addresses of grow op homes on its Web site, and already has identified 49 addresses this year.

Canada's annual pot harvest is as much as 5.3 million pounds, according to the RCMP.  Seizures at the U.S. border tripled in two years to 11,183 kilograms in 2003, according to the latest data from the U.S. National Drug Intelligence Center.

The merchandise is typically sold in pound blocks for about C$2,500 each, much of it stuffed into duffel bags or loaded onto trucks for export over Canada's 5,525-mile border with the U.S., police say.

The government's legalization bill may be delayed beyond next year's election because parliament may have too much work to do on other legislation, Justice Minister Irwin Cotler told reporters on Sept. 27.

The delay suggests Canada's government has grown wary of decriminalizing marijuana possession, White House spokesman Riley said.

"I wonder if more people in Canada are catching up to the reality" of the dangers of drugs, he said.