Column: Small producers deserve direct access to market

For the Valley News
Published: 3/26/2022 6:01:09 AM
Modified: 3/26/2022 6:00:12 AM

The first day of adult-use cannabis sales in Vermont is May 1, just over a month away, when residents and tourists 21 years of age or older will be able to purchase regulated cannabis and cannabis products. Top of mind right now for many Vermont farmers and small producers interested in participating in the emerging legal cannabis market is their ability to reach customers, an essential activity for any small business. Yet it is something Act 164 forbids, and local farmers and small producers demand change.

Vermont’s markets, such as cheese, maple syrup and hemp, are reasonably accessible for local producers. However, under current cannabis laws — Act 164 (2020) and Act 62 (2021) — and the Cannabis Control Board’s proposed final rules for the emerging adult-use cannabis market, farmers and small producers must wholesale their cannabis products to wholesaler or retailer licensees. They cannot sell their products directly to consumers; only retailers are allowed to sell to the public.

Without direct access to consumers, local farmers and small producers will become price takers and not price makers, making them succumb to the demands that intermediaries are willing to offer. A market that does not provide reasonable pathways to the thousands of local farmers and small producers interested in participating will bring implications to its formation, harm product diversity for consumers and producers, and impact viability.

For years, local farmers and small producers in Vermont’s hemp market have been producing and selling cannabidiol (CBD) flower products to the public, including Amy Lems, of Norwich, founder of Vermont Organic Solutions. Lems and her team craft topical and ingestible CBD products for sale online direct-to-consumer as well as wholesale to brick-and-mortar retail stores.

Lems says the current laws and proposed rules “completely ignore several small businesses like mine that are set up as a craft manufacturer selling to both wholesale and online retail to consumers but do not have a brick-and-mortar storefront.” Online sales have proven invaluable to Vermont Organic Solutions and to many small businesses across Vermont, especially during the pandemic. Without that option available in the emerging cannabis market, Lems said, “dispensaries and retail stores will be completely in control of which companies succeed and which do not. They, not the consumer, get to decide what products the consumer is allowed to purchase. This is hardly a fair playing field for many existing small businesses who, like us, have been providing quality products, employment, and adding to the local economy. This favors big money and corporations over small Vermont businesses.”

Entrusting local farmers and small producers with some form of direct-to-consumer access in the upcoming adult-use cannabis market will prove to be a win-win for local retailers, as well. Vermont retailers prefer local farmers and small producers to have some degree of direct-to-consumer access.

The inherent value of a retailer license comes from the ability to offer many different brands and product varieties to consumers at one location. The ability for local farmers and small producers to have direct-to-consumer access will not conflict with retail establishments; it will complement them and foster a vibrant legal cannabis market.

Local farmers know they cannot survive by wholesaling their products alone, taking pennies on the dollar — whether its vegetables, dairy or hemp — and cannabis is no different.

“Small, local farmers do not deserve a sub-par price for an exceptional product. Vermont has already set itself apart from the rest of the nation regarding farmer sovereignty, and it should be no different with cannabis,” says Eduardo Jaime, of Fine Bud Farms in Randolph.

The ability for customers to meet directly with farmers or small producers, online or in person, is just as necessary to the customer as it is to the small business.

“Direct access to consumers will not only showcase each region but also provide a just and equitable cannabis market where small farmers can thrive and lead the Vermont recreational market rather than be abandoned by policies which favor multi-state/national conglomerates that sacrifice quality and prioritize profits over people. The Vermont economy is generated by local communities, and we believe it should stay that way,” Jaime said.

Cannabis is a high-value crop, and empowering local farmers and small producers with direct-to-consumer access will allow those dollars to stay in those communities, generating local economic development and opportunities across the state.

Behind each of the small producers, retailers and farmers in this commentary are hundreds, if not thousands, of Vermonters with similar sentiments and shared concerns about their ability to participate in the emerging adult-use cannabis marketplace.

Cannabis will be a sizable portion of Vermont’s economy, but the currently proposed adult-use market structure privileges dispensaries and retailers as the only direct access to consumers and will not guarantee fairness for farmers and small producers. It is vital lawmakers and regulators allow local farmers and small producers some form of direct-to-consumer access at market rollout so they may have a fair chance to participate and the opportunity to generate wealth in this new industry.

Geoffrey Pizzutillo, of Burlington, is the cofounder and executive director of Vermont Growers Association.

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