Canadians Face Travel Ban for Talking With U.S. Pot Industry While Michigan Dispensaries Fear Product Shortage

Investors are smelling the profit potential in legal marijuana.

And the latest fertile field for financiers is Michigan, the 10th U-S state to legalize pot for recreational use and the only one in the Midwest

Michigan also shares a border with Canada, where pot was legalized in October.

But anyone in the cannabis industry trying to cross that border could see their right to enter the U.S. go up in smoke

Quinn Klinefelter/WDET

 

 

 

 

 

Permanent Ban

The U.S. Transportation Department says more than a quarter of all the trade between the U-S and Canada crosses through the Detroit-Windsor Tunnel and the nearby Ambassador Bridge.

But Customs Officer Agron Martini says some travelers may not make it through if there’s even a whiff that their trip involves marijuana.

Anytime somebody plans on entering the United States to involve themselves in the distribution, proliferation, possession of any form of marijuana, that could lead to them being found inadmissible,” Martini says.

Even traveling just to discuss doing business with the U.S. pot industry can be considered illegal drug trafficking.

Canadian cannabis consultant Rod Elliot, a senior vice president at the company Global Public Affairs, says he and roughly two-dozen others were detained about a month ago, before they could board a flight to a marijuana business conference in Las Vegas.

We were able to get through the next morning,” Elliot says. “(But) there were people who were traveling to that conference who told the border agents that they were investors in the US cannabis industry.  And those people were given a lifetime ban.”

 

I have been told by people in the industry (they) will not travel to the United States if there is even the mere possibility (of) a lifetime ban because (they) work in the legal Canadian cannabis industry.” – Global Public Affairs cannabis consultant Rod Elliot

 

So Elliot says he and some of his colleagues will simply avoid taking business trips to the U.S.

I have been told by people in the industry that ‘I will not travel to the United States if there is even the mere possibility that I will face a lifetime ban because I work in the legal Canadian cannabis industry.’ ”

Michigan’s budding cannabis market, next door to Canada, is drawing significant investment interest.

But Detroit Medical marijuana dispensary owner Stuart Carter says the numerous investors knocking at his door are all based in the U.S.

And there (is) $200 million-to-$300 million in investment money looking to find homes in Michigan.”

Carter says he’s turning down investors, preferring to put his own money in his Utopia Gardens dispensary.

 

Courtesy of Utopia Gardens

The Utopia Gardens medical marijuana dispensary in Detroit, like others in Michigan, faces a severe shortage of pot following new rules instituted by state regulators.

Vanishing Supply

Yet Carter says licensed dispensaries in Michigan do face a big problem.

There’s a shortage of marijuana for legal medical marijuana shops.

The state used to allow caregivers for medical marijuana patients to sell any excess pot to dispensaries.

But Carter says the state now mandates that dispensaries buy only from licensed marijuana growers.

And he says they have not grown enough pot yet to supply dispensaries.  

The state had to extend a deadline that allowed dispensaries to buy from caregivers because there was literally no product available for us to sell,” Carter says.

By the start of next year caregivers will be required to sell their product only to growers.

They, in turn, will sell it to dispensaries, at least until the growers can produce enough pot of their own to sell.

Carter says that will take six months or more at bare minimum, with the roughly three dozen licensed dispensaries in Michigan taking a big financial hit in the process.

He says growers are asking more than double the price caregivers used to charge, with no real end in sight.

The growers will not have product. There will probably by June of next year be three times as many dispensaries as today. So how are they gonna have the productivity to supply a hundred (dispensaries?) It’s a ridiculous middleman gouge,” Carter says.

 

There was literally no product available for us to sell…The growers will not have product…It’s a ridiculous middleman gouge.” — Utopia Gardens medical marijuana dispensary owner Stuart Carter

 

He also estimates there’s about 100 unlicensed dispensaries operating in Michigan.

They can buy pot on the black market, if necessary, and take customers away from the shops that Carter says are operating legally and following the state’s rules and often expensive requirements.

Plus, with marijuana legal in both Canada and Michigan now, there’s likely no shortage of pot on the street.

As for border issues, Carter says Canadians in the cannabis business potentially being banned from crossing into the U.S. will not affect his dispensary.

But even so, he says it just makes common sense to exercise some caution.

Marijuana remains criminalized under U.S. federal law and Carter says he takes no chances at a Customs toll booth.

I don’t even take my business card because I’m not interested in being scrutinized by the Border Patrol,” he says.

Carter says his Utopia Gardens dispensary is pretty established in downtown Detroit.

But many of those involved in Michigan’s still-flowering cannabis industry say don’t want to burn any future bridges, especially those that cross the border. 

 

Click on the audio link above to hear the full story

Image credit: Quinn Klinefelter/WDET

About the Author

Quinn Klinefelter

Senior News Editor

I grab news in the morning, check the papers and the wires, call sources and take a big gulp of coffee. That’s how I start the day.

qklinefelter@wdet.org  

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