‘Help us, we are dying.’ New York’s Cannabis farmers are at their breaking point
More than 30 small farmers responded to a series of questions about how the state’s slow rollout has affected their farm, their finances and their personal lives.
The Cannabis Farmers Alliance, an industry group advocating for the rights and interests of cannabis farmers and small businesses, recently surveyed their membership in preparation for a New York State Senate Subcommittee hearing on the disastrous rollout of the state’s legal cannabis marketplace.
The results are grim.
“This survey had much more response than we even could’ve imagined, as it was met with a sense of urgency,” said Joseph Calderone, the CFA’s vice president and co-founder.
“Each respondent has an email associated with their farm – we did not include the emails to offer some anonymity,” said Calderone, who is also the chief operating officer at Grateful Valley Farm, a licensed Adult-Use Conditional Cultivator.
The survey included 38 responses from farmers across the state. Many said they are on the verge of financial ruin, collapsing mental health and deteriorating personal relationships.
“I have exhausted my body to the point of not being able to recover physically,” said one respondent. “I feel like my family life has been ruined because of my choices to get involved in this industry.”
The farmers’ statements were sent to Senator Jeremy Cooney, who led the Senate Subcommittee on Cannabis hearing last week, and Senator Michelle Hinchey, who recently announced she’ll be pushing for a farmers relief fund in 2024.
The CFA also shared the survey results with NY Cannabis Insider. A representative sample of responses are included below, with some lightly edited for grammar or clarity. The entire packet of answers can be viewed here.
How were you financially harmed by this industry?
“My husband and I have put almost $200,000 of our savings and retirement funds into the business with no way of paying ourselves back in sight. As we are of retirement age, this is a very distressing situation for us.”
“First, the hemp industry disaster created $500,000 in debt because we built the infrastructure and investment but got virtually no return for three years. Then the cannabis license opened and we borrowed more money in hopes that we would make money. Because of the lack of dispensaries open and the entire structure of the program, we are barely getting by and sinking further into debt. We have great quality biomass and, in turn, distillate, but the market has been a complete bust leaving us going into our second harvest completed and less than one-third of last year’s product sold.”
“I’ve had to borrow money for over a year to feed my family and pay bills. My credit is completely destroyed from missing too many mortgage payments. My farm approached foreclosure twice. My children have been affected negatively which is what makes me the most upset. I sold my tractor in desperation to pay bills and groceries and have been left unable to farm other crops without it. It will take years to crawl out of this hole. I had to take a full-time job off the farm with a three-hour commute daily. I’m devastated.”
“With little-to-no places to sell my 2022 harvest, I’m two years behind on my property taxes and will lose my family home in a few short months.”
“I’ve spent all of my savings and have sold half of my stocks/investments that were meant for retirement. I’m a one-person show and I’m sitting on pounds of really good flower, but I have made zero dollars because of the lack of stores open.”
How has lab testing harmed you?
“The exorbitant cost of lab testing is prohibitive and the pass/fail on aspergillus made it impossible to sell smokable flower without the costly remediation of the products.”
“How has lab testing helped? It started with the bottle-necking: only four labs were open. Then we wasted ten of thousands on testing and had almost everything fail only because of a pass/fail aspergillus .... The inconsistencies are atrocious from lab to lab: differences of 10-15% THC from the same strain; turnaround time up to two months. Now we have to wait for someone to pick up the sample, which can take weeks, when it was needed yesterday. Absolutely broken system.”
“Without any income, the expense and logistics of lab testing testing have impaired what type of end-product we are involved in. The testing facility is four hours away, and in addition to the testing fees, there is a fee for the lab to send someone to acquire the sample. The aspergillus testing is seemingly a problem as has been attested to by numerous creditable cannabis experts. Aspergillus is present everywhere.”
“Lab testing is one of the biggest hurdles to get product to market. The aspergillus testing makes it impossible to pass without remediation, which adds cost and time to the process. Remediation has high minimums and we are a single greenhouse farm that can not always meet the minimum requirement. Recently, an additional cost has been added for the lab to pick up the product for testing, which we do not have the option to opt out of.”
How have the regulations harmed you?
“New York is so focused on regulating what it can that it is ignoring that the high production costs and overregulation of direct sales from growers have led legal growers to be Iargely non-competitive with unregulated, unmonitored, and unenforced black market growers and distributors who can pivot quickly and sell much cheaper, with better margins and less risk of total crop or inventory loss.”
“The regulations allowing the ROs to wholesale have devalued all AUCCs and put us head-to-head with the biggest brands in the industry at a time when we need thousands more stores to justify these 11 giant grower operations.”
“The regulations are seriously overwrought. They stigmatize the crop when the goal should be to normalize it. They seem like they were written at the height of the Reagan-era War on Drugs. On the agricultural side, they fail to use existing regulatory frameworks, such as DEC pesticide application regulations or the National Organic Program, as guidelines for growers. Instead, the regulators came up with their own regulations. It is obvious that this was done without any knowledge of agriculture or consultation with experienced farmers, resulting in regulations that are often absurd, frustrating, and overly cumbersome. For us and other growers, the result is an inordinate amount of time and money spent to try to stay in compliance.”
“The most ridiculous and unnecessary requirement is the seed-to-sale software requirement, which is not required by the MRTA. The MRTA only requires tracking of excise tax collections made by the retailers, not cultivators. This requirement can cost us up to $1,000 per month, and is absolutely useless to anyone but the ROs. Increasing security requirements are another useless requirement, and anyone who grows cannabis can appreciate this (how many cultivators have had crops stolen?). Also, the regulations are written so that only processors and retailers can make any profit in this market – farmers can only sell to processors, who then sell to distributors, who then sell to retailers, making the price of the final product absurdly expensive compared to what ROs and the illegal market can sell at.”
“To reference an overused analogy: it’s like being strapped into a plane that’s being built while it’s in the air – except that the pilot is blind and has lost all sense of direction and your seatbelt won’t unlock and you weren’t given a parachute.”
How has the slow rollout of retail stores and multiple lawsuits affected you?
“We wanted to sell our biomass but the processors were offering decreasing splits to the point that I would be giving our biomass away. Without income, we could not pay for lab tests to see if we could have smokable flower, which would be more valuable. Every month that has gone by there are bills that we are accruing just to store the product properly.”
“My main investor pulled out due to the Michigan lawsuit and the failure of New York to open the amount of dispensaries promised in the proposed timeline. My business plan essentially collapsed at that point and I was forced to try to run the business at almost too small of a scale to succeed with the uncertainty of whether there would actually be an outlet to sell my flower.”
“It has crushed our business. We have no reliable income from a product that everyone seems to want, as indicated by the thriving grey market in New York State. We have used up our personal funds and do not have access to capital to continue. We are experienced farmers (40 years growing certified organic vegetables) and had a solid four-prong business plan to raise capital. For example, our first biomass crop was very successful and very high quality. We had planned to use the money raised from sales of the distillate to finance further business development. But the distillate is sitting in a processor’s storage because there is no way to get the products on the shelves of nonexistent dispensaries.”
“The OCM’s decision to violate the MRTA and only allow persons convicted of previous drug offenses to apply for retail licenses for the past two years has been an unmitigated disaster for the entire supply chain. Even with Cannabis Growers Showcases, which is a Band-Aid at best, we’re still sitting on the bulk of last year’s harvest, and now we’re harvesting and preparing this year’s harvest. What happened to the governor’s promise made in December 2022 to open 20 stores per month? Why hasn’t the governor directed the OCM to follow the MRTA? I will, at best, get 10% of the value of my crop. Have the OCM and CCB go for two years without any income and see how well they do.”
“Having no place to sell our crop has financially bankrupt our family!”
How much have you lost financially?
“$297,323.”
“In the last year, we are down $1.5 million after buying our greenhouse.”
“About $200,000 of our own savings and retirement. We are so far in at this point that we can’t afford to get out. We need to sell our existing inventory to be able to get back to where we were before this fiasco.”
“So much: $2.5 million.”
“Just the actual dollars spent and not recovered are over $700,00.”
“$3.5 million.”
“$1 million.”
“Life savings.”
“We have invested over $500,000 over the last three years, not including the lost wages from my lawn care/landscaping business, which I chose to shut down for this season to run the farm.”
How much money should be available to help bail out cultivators?
“50% of documented loss on tax statements.”
“The same amount that has been set aside to assist CAURDs – $150 million. I grew millions of dollars worth of smokable flower that is now worth less than my investment.”
“All AUCCs should receive a $250,000 settlement check from New York State.”
“Sliding scale: more for smaller and less for the cultivators with multiple employees and licenses. At the very least what we have invested, and possibly a fair portion of the expected income based upon what was grown. We are not able to invest in crop insurance as most farmers are. The state who seemingly promised dispensaries and a market, while heavily regulating this commodity and not delivering, should at the very least attempt to rescue the small farmer. In addition, the next two years’ application and licensing fees should be paid for by the state.”
“I don’t know. Anything would help, really.”
How much has this roll out affected your mental and physical health? The dynamics of your family and home?
“I don’t have a life. My mental health is shot and suicidal thoughts are often. I’m happy I’m not married or have children because I can’t imagine the cultivators that do have them. If I was married, I’m confident the marriage would be ended by this business. I’m too busy to have a life or do anything because I have to work to keep the money going so I can spend it on my grow.”
If you are having thoughts of suicide, you can call the National Suicide Prevention Lifeline at (800) 273-8255 or “988,” New York’s lifeline that provides 24/7, free and confidential support for people in distress.
“Divorce.”
“I’m very, very stressed.”
“Daily we feel like we have no control over our future. I know we can grow cannabis but that doesn’t seem to be good enough. Every step of the way there has only been vague verbal support by the state but the actions have been absolutely the opposite. I feel emotionally drained from being led astray and the mounting burden placed on our heads to figure out how not to fail. As farmers, we succeeded in growing two seasons of cannabis but we cannot go beyond that because we do not have the permission from the state to do anything else. I work from 7 a.m. to 9 p.m. seven days a week trying to make enough money to get by and take care of the farm, my parents and my household. There is no room to decompress. The state wants a business plan but our plan changes constantly since there is no consistency. I feel like the OCM is an overbearing parent that you can never please. This is passive-aggressive bulls*** that is used to make the victim feel like it is their fault that things are not going well. They are emotionally abusing the people they claim they are trying to help.”
“My mental health has plummeted. I’ve developed anxiety and stress levels that I wasn’t aware were in my realm. I feel like a failure every single day, and it is hard to approach a lot of things in life the same. My demeanor has changed from happy, positive and upbeat to mostly beat down, tired, sad, and disappointed in myself. My family life has suffered immensely. What I was counting on to build a legacy for my family has led my significant other to despise what I’m doing, as I’m spending all my free time and available savings on this. She was OK with it when the ‘worst-case scenario’ was breaking even with maybe a living wage-worth of profit. As the rules changed every day, dispensaries failed to open, and the prospects of actually getting a return on my investment has declined, so has my relationship. My change in emotional state has further dragged down our relationship, to the point where I’m not having to decide between my family and keeping this going.”
“Many nights of lost sleep, and days of depression over income lost, even though I’ve done everything the state has asked to stay compliant, and to grow good cannabis. The OCM and CCB are deaf to all of our requests for discussion, and warnings of how their decisions are literally killing us.”
“I have zero faith in New York or OCM to manage this program.”
“I’m unable to physically do this anymore. Mentally not good. I’m being treated for depression, insomnia, and anxiety by my doctor. I’ve even had to see a mental health therapist on a weekly basis and I’m paying it all out of pocket as best I can for my two children. I’m certain all of this stress contributed to losing my baby this year. Thanks New York.”
“My husband has lost faith after emptying out his 401k to support the business. He has sought a divorce partially due to the financial strain.”
“I have constant anxiety and have had to see a doctor for prescription medication. I have developed raging insomnia, and when I do sleep, I grind my teeth so hard I have literally moved several teeth in my mouth. My dentist said I need surgery but it’s over $8,000 – so that is not going to happen. As my stress and anxiety have spiraled, my family and friends are tired of me having no other topic of conversation than cannabis. I have no energy to do anything enjoyable and have no work/life balance. I work so many hours that I eat junk food to save time cooking and have gained a lot of weight, which continues to negatively impact my physical and mental health. It is a constant cycle.”
