California Has a Marijuana Surplus, Growers Unable to Export
California’s legal marijuana industry is experiencing a major surplus. Like, way more than residents can handle. Meanwhile, a new regulation will ban growers from exporting marijuana after January 1, forcing them to make a tough decision.
According to Hezekiah Allen, executive director of the California Growers’ Association, state marijuana growers are currently producing around eight times more marijuana than the market demands.
Some estimates show California growers are producing five-times more than what is consumed. Others point to a 12-fold surplus. Either way, all agree the state is growing way too much marijuana to fit within current state and federal regulations.
Allen believes growers are headed for a “painful downsizing curve.”
If he is right, it will mean major growers will be forced to dramatically cut back their operations and lay off hundreds of employees. Some, however, will decide to keep profits and staff —
and continue exporting to other states illegally on the black market.
Skirting the new regulations will be nothing new since interstate transport of marijuana is already illegal under federal law.
The goal, says California Bureau of Medical Cannabis Regulation chief Lori Ajax, is to get as many growers to apply for a state license as possible. Ajax said the bureau is aware that growers will be forced to scale back, and some will “never come into the regulated market,” but she stands by the new regulations.
During a recent panel discussion at the Sacramento Press Club Ajax warned that growers who do not apply for a license would eventually “face enforcement actions.”