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Because there’s a lot more to this cash crop.

Drugs Go Sober: This Series Examines the Non-High Side of Legalization Drugs Go Sober: This Series Examines the Non-High Side of Legalization

Guillermo Nieto is one of a chosen few. He and a handful of his countrymen and women have effectively been granted permission to cultivate marijuana for recreational use by Mexico’s Supreme Court. He manages a small crop of plants on the outskirts of Mexico City, and his long hair, friendly attitude and healthy sense of humor correspond to the typical image of a college stoner.

But Nieto, 42, cultivates for research as well as pleasure: He is the head of the country’s recently formed National Association for the Cannabis Industry (ANICANN is its Spanish acronym), which represents some 200 companies interested in cashing in on the approaching legalization of cannabis.

His relationship with the plant and its psychoactive — rather than business — qualities started way back. And not in Mexico, but in Boston, where he went to school for some six years and started smoking weed. He didn’t dare do it back home. 

Let’s not think about marijuana. Let’s think about cannabis as a whole plant — as fiber, CBD, paper.

Guillermo Nieto

“In Mexico that didn’t look good, especially in a [conservative] town like Guanajuato [in central Mexico]. Imagine — they thought I was crazy,” he says, giggling like the teenager he once was.

At the time, ironically, Mexico was the biggest provider of illegal marijuana to the American market; 10 years ago, the RAND Corporation estimated Mexican drug cartels’ marijuana sales to the U.S. at around $1.5 billion. That’s now no longer the case because of spreading legalization in the U.S. 

Nowhere has the negative impact of cannabis legalization in places like California and Colorado been felt more than in the Mexican mountains of Durango, Sinaloa, Guerrero and other drug-plant producing states. For decades, impoverished farmers had relied on growing small plots of marijuana that they then harvested and sold to powerful drug trafficking cartels in order to feed their families. From 2010 onward, when the price of Mexican weed started to plummet, these farmers switched to heroin-producing poppy. But poppies are in a bust cycle too now, due to the rising popularity of synthetic drugs such as methamphetamine and fentanyl.

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For decades, impoverished farmers had relied on growing small plots of marijuana that they then harvested and sold to powerful drug trafficking cartels in order to feed their families.

Source Deborah Bonello/OZY

So legislation to legalize marijuana’s cultivation and sale that is currently languishing in the Mexican Senate could provide some relief to those communities. The bill is a priority for President Andrés Manuel López Obrador (widely known by his initials, AMLO), who has vowed to bring down the drug-related violence that has ravaged Mexico for more than a decade. Marijuana is the first drug in his crosshairs for legalization, but observers are asking whether the new bill will include the communities that have traditionally farmed the crop or cut them out for mass producers.

“That is going to be the big tension in the law-making during the coming months that will have to be resolved,” says Tania Ramírez, from the influential nonprofit Mexico United Against Crime. “What sort of cannabis market do we want? A focus on products that we want to sell or a focus on social justice and public health — one is not necessarily compatible with the other.” 

Nieto doesn’t agree and states a key fact that bodes well for these communities: “The first thing that we have to understand is that stoners isn’t where the big business is.”

Although in America’s legal markets, recreational marijuana accounts for the biggest share of retail sales, Nieto anticipates that industrial and medicinal marijuana will be the bigger business south of the border. In part, he is listening to local attitudes. Although more liberal than some others in the region, Mexicans are still broadly conservative about marijuana use — especially outside the capital. And the Catholic Church, which commands the most influence among Mexico’s religious institutions, has come out against it.

“There’s a lot of misinformation, and we’re fighting against that. Some 70 percent of Mexicans think cannabis is bad,” says Nieto. A survey last year suggests that although more than two-thirds of the population is against recreational use, nearly half of people approve of industrial use, or hemp (paper, clothes, biodegradable plastics), and more than 86 percent are in favor of medicinal marijuana.

Nieto comes from an agricultural family that has been producing and exporting produce to the United States for the past 75 years. He is also part of a small but growing body of consumers and business people pushing to change the culture around cannabis use in Mexico. The current version of the marijuana legalization bill distinguishes between pharmaceutical, palliative, recreational and industrial cultivation and production, with industrial the least regulated. He envisions a contract model, where licensed farmers supported by commercial buying companies will produce a certain amount of industrial cannabis at an agreed price.

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A man crumbles marijuana to roll a joint during a rally in support of the legalization of marijuana at the La Ciudadela Park in Mexico City.

Source ALFREDO ESTRELLA /AFP/Getty

“Let’s not think about marijuana. Let’s think about cannabis as a whole plant — as fiber, CBD, paper,” Nieto says. “Right now the big problem with the campesinos (farmers) is that they do it underground and when you do it underground, you don’t have the right technology. Without the right seeds, nothing is going to work. You need the right fertilizers and supervision.”

If farmers swapped their traditional THC marijuana plants (which they can now barely sell on the black market anyway) for industrial plants, they could be taken out of the crosshairs of the cartels. Maybe they would even leave poppy farming behind if they were given a decent alternative, which AMLO swears he wants to find.

“Industrial cannabis for those growers up in the mountains is a sure deal and a way of getting out of poverty,” Nieto says. “We have so many people in that business and in poverty that if we’re able to scale up their lives just by a small percentage we will be able to turn around the gross domestic product of the country.” Some estimates predict that Mexico’s legal cannabis market has a potential worth of $2 billion.

But the image of mom and pop pot farming likely won’t last. “It’s an idea with distinct PR value but little evidence to back it,” says security analyst Jaime Lopez. “Depending on how it plays out, big agribusiness might put most of them [small cultivators] out of business. Legal marijuana, from an economic perspective, would be like any other high-value crop: subject to economies of scale and highly attractive for big businesses and niche, artisanal producers.”

And legal marijuana is still a ways off, with even the most optimistic observers skeptical that the bill will be decided by its October deadline. Until it is, organizations like ANICANN are prohibited from promoting or educating anyone — even potential farmers — about commercial cannabis. That means, Ramírez says, farmers’ “needs and demands aren’t necessarily known.”

Getting them on board will depend on prices and other incentives, which will be worked out in the regulatory process after the bill becomes law.

“Right now,” Nieto says, “the opportunity we have and the responsibility we have is telling people that there’s another life for cannabis.”

Read more: The fentanyl epidemic’s other victim — Mexican poppy farmers.

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