Here’s a Reason Why China Fears US Cannabis
Throughout the news cycles of the past few weeks, there have been many talks about “Cannabis and China”. Namely, the Chinese government fears the legality of cannabis in the west. The Chinese, while in ancient times being proliferators of cannabis, these days they mostly focus on hemp cultivation.
In fact, China produces more than half of the world’s hemp mainly for textiles and more shockingly, owns more than half of the cannabis patents around the world. Despite the fact that China doesn’t have legal cannabis on the books, there is a lot of growing happening there, both government sanctioned and not.
It seems that the Chinese is taking the “Wait and See” approach with a bit more foresight than people give them credit. While the United States and Canada, and similar countries, are legalizing, the Chinese are known for innovating processes, reducing prices and mass producing products.
Is this potentially where the Chinese cannabis market will be focused on? Perhaps. However, the story today revolves not around the future potentials of the Chinese cannabis market, but rather the threat the west poses to that potential cash cow.
More Chinese are Starting to Smoke
According to Chinese officials, there has been an influx of cannabis from the west into the country. Most of their illicit hauls come from Canada. In fact, nearly all of the illegal cannabis sold outside of Canada went to China.
For a state that thrives on a dictatorship, having individuals smoke pot and question authority is not a good thing. China has some of the most severe punishments for illicit drug trafficking, where possessing more than 50 grams could land you the death penalty. (fun stuff)
Nonetheless, it seems that whether for medicinal purposes or recreational purposes, there is a higher demand for cannabis these days.
Yet, this is still not the real reason the Chinese fears legalization in the west.
Who will break the market?
As we know, the Chinese has more than half of the global cannabis patents in their possession. This means that they are probably going to be focusing on the pharmaceutical applications of cannabis. They have teams of scientists working on it, and while we don’t know what they are cooking, we do know that the Chinese don’t play around when it comes to dominating global markets.
Currently, China is taking its time. It’s in no rush to speed up their research mainly because the United States still holds cannabis in the “illegal category” on a federal level.
But what happens when it is de-scheduled completely and innovative companies get to throw billions into R&D? This is truly what scares China.
If the United States were to lift the red tape, would the Chinese have the time to catch up to the market place in the west? Of course, China has the ability to employ low cost employees, utilize the totalitarian government to create a cannabis market seemingly overnight.
But what happens when the companies in the west begin to discover new applications? What happens when the number of global patents on cannabis (currently at 606) swells up to double that? What happens when an American company isolates a cannabinoid that kills certain types of cancers? I’m not saying that it’s happening, I’m saying “what if?”
The global cannabis market is a multi billion dollar market. For a long time, China has been the major player in industrial hemp cultivation. However, the United States, Mexico and Canada can become massive competitors.
In fact, if the North American countries were to ban together for a North Atlantic Cannabis Trade, they would dwarf the Chinese production in a matter of years. You can find cheap labor in Mexico, top notch processing and development in the U.S and Canada, and global trade access between the three countries.
Don’t wait too long
One thing we need to understand is that the Chinese won’t sit idly for too long. Each day that the United States stalls on legalization, is a day that the Asian cannabis trade becomes stronger. The US would already be competing with Chinese Hemp, meaning they are starting with a handicap.
While lawmakers bicker over how to legalize cannabis, the Chinese are raking up patents and preparing for the next boon that will occur all over the world. For those still fighting legalization, they are missing the big picture.
The market is here to stay, there is no longer any chance of putting that genie back into the bottle. What is now important, for any country considering entering into the global cannabis market, is to establish the industry, open the floodgates of research and development, and to claim their stake in the global cannabis pie.
The only possible fear the Chinese could have when it comes to US cannabis, is if they were to legalize it at a federal level.
Here’s a novel idea, Tag @RealDonaldTrump to this post, we might have solved his “Chinaaa” problem.