There’s a new major cannabis syndicate in town, and they’re making a big splash. The group is especially notable because it’s backed by both Health Canada and Manitoba Liquor and Lotteries, and because it gives partial proceeds to charity.
Five of Winnipeg’s finest craft cannabis companies have banded together to form the TobaRolling Syndicate, which allows the separate businesses to package and deliver their products in the same facility.
The partnering companies are Alicanto Gardens, Cypress Craft, Kief Cannabis, Natural Earth Craft Cannabis and TobaGrown. Jesse Lavoie owns TobaGrown and is the president and CEO of TobaRolling.
“TobaRolling is a processing, distribution and sales company. We take care of turning all that bulk (cannabis) into packaged goods. We also deliver to every Manitoba dispensary,” he says.
“We’re just extremely passionate growers, and our main goal is growing the best product we can for those who enjoy it. It’s been a great partnership so far,” Jesse Denton, lead grower at Kief Cannabis, says.
“We’re a part of the syndicate. We support all the additional growers and try to bring everyone together as much as possible.”
Lavoie formed the syndicate after being frustrated with the high shipping costs associated with acquiring cannabis from out of province. These costs cut into his altruistic endeavours.
“One of the companies I helped start was called CannMart, a licensed producer out of Toronto. I came back to them with an idea to help me launch Canada’s first not-for-profit pre-roll. All the profits from the pre-rolls called TobaRolls would go towards local charities and our legal bills for the constitutional challenge to get more plants for recreational purposes for growing here in Manitoba,” Lavoie says.
Manitoba and Quebec are the only Canadian provinces where it’s illegal for people to grow non-medical cannabis in their homes. This overrides the federal law that allows Canadians to cultivate up to four cannabis plants per residence for personal use.
“The shipping was really hurting us and our donations, so I decided to work with local producers to work inside their buildings and become a processing/distribution partner,” Lavoie says.
Profits from the TobaGrown pre-rolls help local charities like Habitat for Humanity Manitoba, Harvest Manitoba, True North Aid and the Manitoba Metis Heritage Fund. To avoid competing with their syndicate partners, TobaGrown sources cannabis from outside the province.
“They’re called Safari Flower, a fully women-run, licensed producer in (the Niagara region). They help us out there, and it’s enabled us to make substantial donations in the five months it’s been going. We’ve donated just under $20,000 to the local charities while helping fuel some of our legal bills against the province,” Lavoie says.
The ins and sprouts
While seasonal plants aren’t exactly flourishing outdoors in Manitoba at this time of year, Tim Doerksen, director and owner of Natural Earth Craft Cannabis, says they can thrive indoors.
“We can’t grow cannabis outdoors commercially in Manitoba. The seasons and life cycles don’t work that way,” he says.
“We’re in a room with a controlled environment, temperature, humidity and light quantity. It takes about 12 weeks from the time we plant them to the time we harvest them. That’s the beauty of indoor growing. You are mimicking nature to its most finite extent.”
Natural Earth sources “genetics” from companies and nurseries across the country to grow “different strains and different types of cannabis.”
Denton, who works with Kief Cannabis, says attention to detail separates craft companies from larger producers.
“It’s no different than cooking,” he says. “Everyone’s process is slightly different. We take the time a lot of the bigger, licensed producers don’t take in terms of curing the product, hand-trimming the product, doing the proper flush time on the product to make sure the burn is clean.”
One of the biggest hurdles smaller companies like Kief Cannabis and Natural Earth face is the ongoing stigma surrounding cannabis use. In many cases, it’s virtually impossible for these operations to secure financing or loans from major banks.
“It’s extremely difficult to get any institutional support. We were funded all through private investment as a company. We had a number of banks turn us down just because we’re a cannabis company. ‘We don’t support this mode of business,’ essentially,” Denton says.
Lavoie partially attributes this to the fact that many major banks’ headquarters are located in the United States. “For them to associate with cannabis, which is federally illegal in the States, is not a risk they’re willing to take,” he says.
Doerksen says credit unions will do business with Natural Earth, but only for transactional business accounts.
Restrictions extend to marketing, too, as social-media services like Instagram crack down on cannabis advertising. Taxes and regulatory fees can also shrink potential advertising budgets.
“Marketing is very stringent,” Lavoie says. He claims that cannabis is the “most heavily taxed industry in Canada,” which “does affect the retail price.”
However, many producers say the burden is worth it – especially since they’re able to help charity organizations and the local economy.
“We’re at 11 jobs now in our company, and we’re bringing a lot of the locals to market faster, like local producers. We’re somewhat pushing out out-of-province cannabis,” Lavoie says.
“We were growing really high-quality stuff, putting a lot of love into it and then just watching it go out the door with someone else’s label on it. Keep the money here, keep the money moving within Manitoba is what we really wanted to do,” Doerksen says.
And while larger companies still dominate the marketplace, these producers are content to carve out their niche as careful cultivators delivering a high-quality product.
“It’s just going to be an interesting game of chess for the foreseeable future on competition ... but it’s a game we’re really good at playing, and we feel like we’re winning right now,” Lavoie says.
Published in Volume 77, Number 19 of The Uniter (February 16, 2023)