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Canada: Vegetable growers convert to cannabis to help boost marginsAhead of Canada's legalization of recreational cannabis, a slew of partnerships are cropping up between greenhouse farms and medical cannabis companies.
"When we started, the margins were fantastic," says Michael DeGiglio, chief executive officer of Village Farms. He started the vegetable greenhouse company in the United States in 1987 and expanded to Canada in 2006 after acquiring Hot House Growers in Delta, just south of Vancouver.
According to Mr. DeGiglio, cheaper Mexican produce, available since the North American free-trade agreement (NAFTA) went into effect in 1994, has meant Canadian farmers have had to lower their prices to be competitive and export as much as possible to turn a profit. Even today, many vegetable and grain farmers are operating on thin margins.
Boosting his profit through cannabis will help compensate for Village Farms' lower-margin vegetable business and ensure its viability and longevity. "This can only help us with the produce side," he says.
Sylvain Miron, the general manager of tomato producer Les Serres Stéphane Bertrand in Mirabel, says he also felt a move into cannabis – through a joint venture with Canopy – would help protect his company's future.
Read more at The Globe and Mail (Dario Ayala)
Publication date: 1/23/2018
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