If retail Cannabis were legalized, it would be Virginia’s biggest cash crop
That’s based on the experience in other states, where cannabis has quickly overtaken more traditional crops.
Agriculture is Virginia’s largest private industry. It says so right there on the state’s website: “Agriculture is Virginia’s largest private industry.”
Within agriculture, soybeans are Virginia’s biggest cash crop. Virginia farmers grow $351.6 million worth of soybeans every year. Soybeans aren’t really a thing in Southwest Virginia but they are elsewhere in the state, with yields increasing the further east you go. The Eastern Shore harvests more soybeans than anywhere else in the state.
Other farm commodities are bigger: Broiler chickens, cattle, turkeys and milk rank higher than soybeans in terms of wholesale values, but when it comes to stuff growing in the ground, soybeans are where it’s at in Virginia.
How big are soybeans in Virginia? Virginia’s soybean crop is almost five times more valuable than the state’s tobacco crop, and we’re a state whose history is entwined with that crop. Tobacco has the glamour of tradition and controversy, but soybeans are where the money is. Virginia Tech conducts research into soybeans to figure out how to increase yield. Governors tout soybeans and look for ways for the state to sell more of them. A report a few years ago estimated that Virginia has 2,180 jobs related to soybeans.
Now consider this: Virginia has the potential to add a cash crop that could be even bigger than soybeans — and an industry that, in terms of sheer number of jobs, would rival Amazon’s vaunted HQ2 in Arlington. All it would take to add $350 million to $500 million to the state’s agricultural output, and perhaps 22,000 jobs to the state’s workforce, is a smidge of ink.
Unfortunately for those who are in favor of this new cash crop, the ink required must come from the pen of Gov. Glenn Youngkin, who has made it clear he has no interest in this crop. I refer, of course, to cannabis.
The Democratic-controlled General Assembly has now passed legislation to create a legal market for growing and selling cannabis in the state. Given his druthers, it sounds as if the governor would like to take out his pen, scrawl “I veto” across the bill, and move on. And maybe he will. However, there is the matter of the sports arena he’d like in Alexandria — what legislative price will he be forced to pay for that? Might acquiescence to legal cannabis be part of a grand bargain? Democrats would like that, but the problem is there are lots of things Democrats might like. At what point does the political price become too high?
I can’t answer that — not yet anyway. There are lots of reasons why Youngkin might feel disinclined to allow retail cannabis, starting with a general distaste for enabling cannabis to become more widely available and socially acceptable. On the other side of the question, we have Greg Habeeb, a former Republican legislator from Salem and now a top lobbyist for cannabis interests. He makes the case that cannabis is already widely available — Virginia legalized personal possession three years ago. The only thing this bill will do, he says, is make sure the money for cannabis goes to regulated business, not a sketchy black market of, well, dope dealers. I’m sure we had similar arguments nearly a century ago with the prohibition of alcohol. Now we have a whole supply chain of breweries and distributors and not bathtub gin.
I realize the economic numbers I’m about to present may mean nothing if you object to retail cannabis on moral grounds or some other grounds. However, the whole debate we’ve had in the legislature over how to create a retail market has dealt with the details of how licenses for cannabis cultivation, processing and sales would be distributed. Today, let’s step back and look more broadly at just how big this new cannabis industry might be — if the governor chooses to allow it.
By now, we have 40 states that have legalized cannabis to some degree — some allow only medical marijuana, some have full retail markets for what’s considered “recreational” weed, others are somewhere in between, with Virginia being one of those. That means we have some good data points we can refer to, so let’s go.
Here’s the first one that might blow your mind without taking a single toke: Cannabis is now the sixth biggest cash crop in the country, according to research by the cannabis website Leafly, Whitney Economics and U.S. Department of Agriculture. It comes in at $5 billion nationally, just behind cotton at $7.5 billion.
When we look at individual states, cannabis ranks even higher in some places.
In five states, cannabis is now the state’s biggest cash crop: Alaska, Colorado, Massachusetts, Nevada and Oregon. Now, some of those aren’t states that we think of as farm states — I’m looking at you Alaska, Massachusetts and Nevada. Colorado and Oregon, though, are legit states for farming, and cannabis is now a major ag presence. In Washington state — with Colorado, the first states to legalize jazz cabbage, as some call it — cannabis ranks fourth. In California, which has the nation’s biggest cannabis market, the devil’s lettuce ranks fifth, four spots ahead of actual lettuce.
So how might Virginia rank if it legalized retail cannabis? Our two best comparison states might be Michigan and Washington. Michigan is somewhat more populous (it’s the nation’s 10th biggest state, we’re number 12) while Washington is right behind us in 13th place. Washington also has a more mature cannabis market, dating to 2012, while Michigan’s is relatively new, with the first dispensaries opening in 2019.
According to Leafly, Washington in 2022 (the most recent data available) grew $350 million worth of weed. If that were Virginia, cannabis would be just $1.6 million shy of King Soybean. Michigan, however, grew $551 million worth of pot. Granted, Michigan’s got about a million or so more people than we do, but if Virginia produced cannabis at Michigan’s rate, then we’d be talking about King Cannabis. And then there’s Oregon, a state half our size, but a state that likes to blaze a fat one. Oregon produced $500 million worth of cannabis. OK, let’s set Oregon aside. Portland’s weird. Let’s find some more “normal” states for comparisons. Massachusetts is smaller than Virginia, and a relatively new entrant into the legal retail market, with sales beginning in 2018. Massachusetts grew $362 million worth of cannabis. Here’s another state that’s smaller than Virginia and smaller than Massachusetts, too: Colorado. It grew $687 million worth of cannabis. I’m inclined to set Colorado aside for the same reason I’d set Oregon aside, but we’re still left with Massachusetts. Even if Virginia replicated that smaller state’s relatively low amount of cannabis sales, cannabis would still be our biggest cash crop — and our fifth biggest agricultural commodity.
Whether we’re talking cannabis grown indoors or cannabis grown outdoors (and most of it’s grown indoors), we’re still talking about the potential of a significant new cash crop in the state. Cannabis would not be some quirky little niche product; we’re talking here about a real economic power.
So how would all that translate into jobs? Vangst is a website that follows cannabis employment. Its 2023 jobs report says that Washington state — again, very close to Virginia’s population — had 22,050 cannabis-related jobs. Arizona, just a wee bit smaller, had 21,596 cannabis-related jobs. Massachusetts, smaller yet, somehow had 28,370 cannabis-related jobs.
If you picked any of those comparable states and added those to Virginia, we’d be talking a jobs announcement on the order of Amazon’s HQ2 — although the jobs wouldn’t be comparable in terms of wages.
However, the experience elsewhere is that some cannabis jobs are quite well-paid. We need to stop giggling about weed and look at cannabis as a real business, whether we like it or not. Vangst says that the single biggest sector of the cannabis industry — accounting for 31% of the jobs — is on the cultivation end. It says trimmers make $16 to $20 an hour, but grow managers make $65,000 to $90,000 a year and a director of cultivation can pull down $100,000 to $150,000 a year. (It’s unclear from the report whether these are averages or medians).
Retail accounts for 23% of cannabis jobs. Vangst says budtenders, as the sales people are called, make $17 to $28 per hour with top executives pocketing six figures a year.
Ancillary jobs come in for 20% of the industry. This includes lawyers, controllers, marketing directors, all the usual sorts of executive positions you’d expect with any business. Again, about six figures or more.
Processing and manufacturing accounts for about 17% of the jobs. Vangst says extraction technicians can make $45,000 to $90,000 a year, while a director of extraction can expect $90,000 to $140,000 a year.
A regulated market also requires testing labs. They account for a relatively small number of jobs, but they’re well-paid ones — chemists are listed at $60,000 to $80,000 a year, lab directors at $90,000 to $130,000 a year. When business leaders talk up the need for STEM educators, they don’t mean these kinds of stems, but lots of people with those science, technology, engineering and math degrees can find well-paying jobs in the cannabis industry.
In most parts of Virginia, many of these potential cannabis jobs aren’t just well above the local median wage, they’re above the local household median income.
I don’t mean to sound like a pot pusher, but I do like dealing in numbers and these are the numbers here. Youngkin says he wants to create a “rip-roaring economy” in Virginia. He’ll have to decide if that includes these jobs.
