How the weak dollar is like, killing your buzz, man
iStockphoto.com According to this story from The Missoulian newspaper in Montana, the U.S. dollar’s decline relative to the Canadian “loonie” is totally harshing the mellow of British Columbia’s marijuana growers. While production costs for potent “B.C. bud” remain at around $2,000 Canadian per pound, the value of the American dollar has fallen to about $1.10 ...
iStockphoto.com
According to this story from The Missoulian newspaper in Montana, the U.S. dollar's decline relative to the Canadian "loonie" is totally harshing the mellow of British Columbia's marijuana growers.
While production costs for potent "B.C. bud" remain at around $2,000 Canadian per pound, the value of the American dollar has fallen to about $1.10 Canadian due to record public debt and the rise of India and China. This means that the backpacks of cash that regularly cross the Canadian border to buy pot have declined in purchasing power and its no longer worth the risks and costs for many smugglers. This is bad news for Canadian growers, who ship about 90 percent of their crop to the United States, as well as for their customers in the United States, who now have to pay a lot more or buy elsewhere. No wonder rappers are now flashing euros.
According to this story from The Missoulian newspaper in Montana, the U.S. dollar’s decline relative to the Canadian “loonie” is totally harshing the mellow of British Columbia’s marijuana growers.
While production costs for potent “B.C. bud” remain at around $2,000 Canadian per pound, the value of the American dollar has fallen to about $1.10 Canadian due to record public debt and the rise of India and China. This means that the backpacks of cash that regularly cross the Canadian border to buy pot have declined in purchasing power and its no longer worth the risks and costs for many smugglers. This is bad news for Canadian growers, who ship about 90 percent of their crop to the United States, as well as for their customers in the United States, who now have to pay a lot more or buy elsewhere. No wonder rappers are now flashing euros.
With the value of cross-border trade diminishing much faster than the risks from American authorities, a kind of ganja nationalism may be developing in British Columbia, where growing pot has been virtually legalized for some time. Alan Middlemiss, owner of the Holy-Smoke Culture Shop and Psyche-Deli in Nelson, B.C. sounds like some strange mix of the Dude from “The Big Lebowski” and Evo Morales:
We have a motto around here, and it’s called Canadian pot for Canadian lungs,” Middlemiss said. “We don’t need the DEA blowback. We’ve got DEA helicopters over our gardens, and all this DEA money out of Washington being spent up in Vancouver. It’s nuts.”
But the big winners from all this are Mexican marijuana growers, who will likely step in to fill the gap (the peso is struggling as well), and Econ 101 professors at U.S. liberal arts colleges, whose students will soon be clamoring for answers.
(Hat tip: USA Today‘s On Deadline blog)
Joshua Keating was an associate editor at Foreign Policy. Twitter: @joshuakeating
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