Uruguay has set the price for marijuana at less than US$1 a gram, as it lays out rules for the government-regulated sale of the plant in a daring, closely watched social experiment.
The small South American country is following up on its groundbreaking decision in December last year to legalize the production and sale of pot under government control, an international first amid growing sentiment worldwide that the war on drugs has failed.
On Friday last week, the government announced rules for the new market, setting limits on amounts of weed individuals can buy, its potency and its price.
It also put in place a process for issuing licenses to grow and distribute marijuana, with a decree to be signed today and go into effect tomorrow.
Legal marijuana will become available at the end of the year, when pharmacies begin selling it under government supervision.
Under the law, consumers will be able to grow their own cannabis or buy through consumers’ clubs. Buyers must be 18 or older, residents of Uruguay and registered with authorities.
The price for a gram of marijuana has been set at between 20 and 22 Uruguayan pesos (US$0.86 to US$0.95), and individuals will be allowed to buy no more than 40g a month. The price reflects Montevideo’s estimate of costs plus a profit for producers and pharmacies, officials say.
Uruguayan National Drugs Board head Julio Calzada estimates that between 18 and 22 tonnes of marijuana are consumed a year in the country of 3.3 million.
“Based on this, we need a maximum of 10 hectares,” of crops to meet demand, he said.
The marijuana will have a 15 percent concentration of tetrahydrocannabinol — the plant’s main psychoactive ingredient — and come in five varieties.
The price and potency also were chosen in part to compete with illegal pot grown in neighboring Paraguay, the source of almost all the illegal cannabis sold in Uruguay.
“In part, that’s because they say it ‘gives a good hit’ and it is very cheap. Marijuana sells for US$20 a kilo in Paraguay,” said Cesar Manuel Sosa, the head of Uruguay’s counter-narcotics smuggling office.
However, some doubt that demand for illegal pot will disappear with legalization.
“There are some people who are afraid of registering because of their work and if an anti-marijuana government comes to power, the database could be used against them,” said Juan Pablo Tubino, owner of a Montevideo store that specializes in pot paraphernalia.
Uruguay’s legalization move has set off a small move in businesses like Tubino’s that cater to cannabis consumption.
Juan Andres Palese and two other young entrepreneurs opened Urogrow, the country’s first “grow shop,” in December 2012.
Since then, their store has moved into a space five times larger to display tents for growing marijuana indoors, lamps and planters, as well as imported fertilizers.
Palese has competition from two other stores in Montevideo and a third on its way, with a fourth near the exclusive Punta del Este beach resort.
“Obviously, the number of growers will increase with the new law, but I think there has been an uncorking of demand since it was passed by the Congress,” Palese said. “There were people who grew marijuana discreetly who have come out of the closet, as it were.”
Heavily criticized by the UN’s International Narcotics Control Board, Uruguay’s marijuana experiment is being closely followed by countries eager to find an alternative to the expensive and violent “war on drugs” spearheaded by the US.
Hannah Hetzer from the US-based Drug Policy Alliance organization said there is global interest in studying what aspects of Uruguay’s experience can be applied to other countries.
“There is a consensus in several countries that what we are doing in the war on drugs is not working, but not on what the correct answer would be,” Hetzer said. “There are always risks in any reform of drug policies.”
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