Pubdate: Fri, 28 Sep 2007
Source: Globe and Mail (Canada)
Copyright: 2007, The Globe and Mail Company
Contact:  http://www.globeandmail.ca/
Details: http://www.mapinc.org/media/168
Author: Allan Dowd, Reuters

SLUMPING GREENBACK GOES TO POT

VANCOUVER -- The strong Canadian dollar has hit the illegal marijuana 
sector just as it has other industries that export to the United 
States, one of Canada's best known legalization advocates said yesterday.

But western marijuana growers have also benefited from Canada's 
strong economy, especially the booming Alberta oil patch, which has 
increased domestic consumption, according to Marc Emery, a founder of 
the British Columbia Marijuana Party.

The Canadian dollar touched parity with the U.S. dollar last week, 
topping a rise of some 60 per cent over the past five years. 
Yesterday, the loonie closed at 99.86 U.S. cents.

A stronger loonie has cut the profit of selling potent "B.C. Bud" 
marijuana in U.S. markets at a time when producers in Canada struggle 
with tighter border security and competition in the United States 
with pot from other sources.

Top quality Canadian pot is selling for $3,700 a pound in the United 
States, compared with $2,400 in domestic markets, according to Mr. 
Emery, who is also editor of Cannabis Culture magazine and is 
fighting extradition to the United States.

"When you factor in all the risk and transportation, that [higher 
export price] is not a big deal any more," Mr. Emery said, adding 
that when the Canadian dollar was weak exporters could double their 
money selling into the United States.

U.S. authorities seized 26,414 kilograms of marijuana in northern 
border states in 2005 compared with 11,546 kg. in 2001, according to 
the U.S. Drug Enforcement Administration's latest National Drug 
Threat Assessment.

A study in 2004 estimated the street value of British Columbia's 
annual marijuana crop at more than $7-billion, which would make it 
one of the western Canadian province's largest industries.

Simon Fraser University economics professor Stephen Easton, who wrote 
the 2004 report, said there has been no specific study of the impact 
of currency on drug exports but it should be the same as with legal exports.
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MAP posted-by: Keith Brilhart