Mexico Legalizes Cannabis: Big News? Little News? No News at All?

The balance of cannabis trade routes and the marijuana exchange rates between the United States and Mexico are in a state of flux. For decades, Mexican cannabis provided a key source of THC nourishment feeding North America’s appetite for marijuana.

Traditionally, the supply of Mexican cannabis into the United States has arrived through marijuana smuggling networks spanning the 1,954 miles of border where Mexico directly attaches to the USA. Every last joint of Mexican cannabis consumed by American marijuana enthusiasts since the 1960s time of Acapulco Gold and earlier has been illegal cannabis.

Until this very day, every instance of an American possessing, trading or consuming Mexican cannabis has been a crime in violation of United States drug laws.

Legal American Cannabis Was Bad News for Illegal Mexican Imports

By 2016, marijuana cultivation and sales were legalized and regulated in California, Colorado, Oregon and Washington State. Mexican marijuana remains illegal in those states.

California’s entrenched cannabis farmers emerged from the black market to the taxed marijuana economy. Clandestine cannabis cultivators in neighboring states used equity funder seed money to expand their operations. American grown cannabis crops proliferated.

All of the medical marijuana and recreational cannabis legalization in pioneering U.S. jurisdictions upended the relationship between Mexican marijuana suppliers and American cannabis consumers. The demand for Mexican cannabis supplies, with all their attached criminalization, faded drastically.

The Drug Enforcement Administration’s “2020 National Drug Threat Assessment” announced that border seizures of Mexican marijuana by American narcotics enforcers, and presumably smugglers’ attempts to export contraband northward, had plummeted during the past decade. In the DEA’s estimation, cannabis revenue streaming south of the border from the United States has slowed to a trickle.

In what must be a sad prospect to the DEA, when or if Mexico legalizes cannabis commerce, American marijuana money may again pour into the country to the south.

U.S. and other international investors are poised to send a fresh new river of cannabis cash into Mexico, in the form of seed funding, business development expertise and partnership opportunities to Mexico’s beleaguered green rush entrepreneurs.

Do We Know When Mexico’s Legal Marijuana Will Be Legal?

It’s been only a few months since national cannabis prohibition was switched to legal in Mexico. Since then, Mexican lawmakers have been taking their time and have yet to arrive at the place where the elimination of marijuana criminalization combines with a buzzing system of taxed and regulated cannabis commercialization to spread marijuana induced wealth and happiness throughout the land.

On March 11, 2021, an unequivocal New York Times headline stated: “Mexico Passes Bill to Legalize Cannabis.” The paper of note characterized Mexico’s embrace of legal cannabis as “a milestone for the country.” Subsequently, that New York Times headline has been scaled back to the more equivocal “Mexico Set to Legalize Marijuana, Becoming World’s Largest Market.

Not quite 90 days after the New York Times semi-retracted its announcement that Mexico had legalized cannabis, on May 3, 2021, cannabis news website Marijuana Moment followed up with its own headline: “Mexican Lawmakers Fail to Legalize Marijuana Ahead of Supreme Court Deadline.”

Marijuana legalization has been passed by both chambers of Mexico’s Congress, the Senate and the Chamber of Deputies, in slightly differing bills.

Marijuana Moment reports that revisions to the bills protected forest areas from being coopted as cannabis grow sites, set up expectations for campaigns to discourage “problematic cannabis use,” especially by minors, and established penalties for possession of impermissible large quantities of cannabis.

Some advocates were disappointed that provisions to prioritize commercial cannabis licenses to marginalized communities were without minimum quotas or robust enforcement. Some lawmakers expressed liability concerns of their own. From Marijuana Moment:

After the Chamber of Deputies approved the Senate-passed legalization bill, senators said that the revised proposal was critically internally conflicted—on provisions concerning legal possession limits, the definition of hemp and other issues—and lawmakers themselves could be subject to criminal liability if it went into effect as drafted.

The houses of Mexico’s Senators and Deputies sawed back and forth on the partially conflicting cannabis legislation, staking out provisions for possession limits, seeking consensus on commercial cannabis regulatory bodies, taking our time, as Senate Majority Leader Ricardo Monreal Avila put it, “to act with great prudence in this matter” and “not allow ourselves to be pressured by interests” such as lobbyists from American tobacco and pharmaceutical industries.

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Revisions in Mexico’s differing marijuana legalization bills continued being volleyed between Senators and Deputies. More than one Senate committee took it upon themselves to expedite regulated cannabis commerce’s path to enactment. In committees is where Mexico’s cannabis legalization progress is suspected to have stalled.

Open debate to finalize the details of Mexico’s legal cannabis regulations abruptly closed on April 20, 2021, the date set by the country’s supreme court as deadline for working everything out. Mexico’s marijuana legislators had missed the 4/20 cutoff.

Mexico’s Senate has not asked for an extension of its deadline to enact the country’s cannabis regulations. Lawmakers have hinted that a special legislative session may be called to establish Mexico’s legal cannabis program, but only after June’s elections have been held. The June elections may result in roster changes in the Senate and Chamber of Deputies. The Supreme Court makeup will also have switched a few seats.

Despite the wild card variables of Mexican marijuana legalization, some international bettors are doubling down on cross cultural capitalization once Mexico has effectively regulated its cannabis consumption, possession, production and marketing.

Who’s Still Watching Mexican Cannabis Legalization?

Online news source Border Report, which covers events along the U.S. border with Mexico, expressed its close and vested perspective of potential partnerships between American and Canadian cannabis firms and Mexico’s emergent legal marijuana industry in a March 13, 2021, report, titled “U.S. Companies Ready to Tap Into Mexico’s Legal Marijuana Industry.”

The El Paso-based news service quoted the opinion of Raul Elizalde, CEO of HempMeds, that Mexican marijuana legalization is “a great opportunity for international companies, Canadian and U.S., to start investing in Mexico. I think it would be a mistake not to.”

The New York Times singles out international Canadian cannabis company Canopy Growth as all set to invest in Mexico’s legal cannabis market, potentially the world’s largest.

Cannabis news and finance site technical420, insisting that “The Mexican Cannabis Market Is Shaping Up to Be a Major Global Player in 2021 and Beyond,” adds Aurora Cannabis and PharmaCielo to that list of proactive cannabis industry innovators looking to work corporate magic with Mexican cannabis.

Now the only thing these high flying international cannabis companies need is for Mexico’s lawmakers to adopt the same cannabusiness-do attitude, move it forward and seal the deal.

Written by
Allan MacDonell
Allan MacDonell

Leafwell's Editorial Director, Allan MacDonell’s work has been featured in publications ranging from Dazed and Confused UK to the New York Times and Washington Post. He is the author of Prisoner of X, Punk Elegies and Now That I Am Gone, and was a founding editorial director at online outlets including Buzznet, TakePart and Kindland. MacDonell views teaming with Leafwell as an opportunity to encourage the emerging role of legal cannabis as a highly effective medical treatment.

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