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Cannabis Legal in Uruguay But 70% of Consumers Still Source From Illicit Market

Cannabis Legal in Uruguay But 70% of Consumers Still Source From Illicit Market

Uruguay was the first country to legalize adult-use cannabis consumption. But according to a new study, most consumers are still buying from illicit sources because legal cannabis is just not up to the quality that the black market can supply.

Abhishek Pratap

26 September 2022, 09:00:00

The decriminalization of marijuana in Uruguay has helped to take drug traffickers out of the market, but the legal supply of the drug is still insufficient and of low potency, which leads most consumers to turn to the illegal market. This report from Play Crazy Game first posted on 21 September 2022.


The 2021 data show that 27% of drug users buy marijuana legally, according to a study published by the IRCCA (Institute for the Regulation and Control of Cannabis). That is, of the total number of users, more than 70% buy in the illegal market.


In 2013, Uruguay became the first country in the world to legalize and regulate the production and consumption of cannabis. The measure began to be applied just over five years ago.


Spearheaded by former president José Mujica, the project was presented as an alternative to the “war on drugs”.


Since then, the Uruguayan economy has received US$ 20 million from the cannabis trade. Legalization also allowed the emergence of an incipient marijuana export industry (exports are currently focused on flowers for medical use and are mainly destined for the United States, Switzerland, Germany, Portugal, Israel, Argentina and Brazil).


According to data from the Uruguay XXI portal, in 2020 exports doubled compared to the previous year, reaching 7.3 million dollars. In 2021, revenue was $8.1 million and in the first half of 2022, $4.4 million.


Despite being a pioneer in this industry, Uruguay still exports less than other competitors in Latin America, such as Chile, which in 2020 earned US$59 million, Peru (US$40 million) and Colombia (US$37 million), according to a report from the Quito Chamber of Commerce.


How does the sale of legal marijuana work in Uruguay?


The law implemented three mechanisms for acquiring marijuana:

· self-cultivation,

· Marijuana clubs;

· Buy at pharmacies.


All of these mechanisms are under state regulation, and only residents of the country can buy marijuana, although parliament is considering opening the market to tourists.


“Cannabis regulation was more effective than repression in terms of the impact on drug trafficking,” says Mercedes Ponce de León, director of the Cannabis Business Hub and ExpoCannabis Uruguay.


By the end of the year, the government plans to sell stronger cannabis in pharmacies to attract more recreational consumers to the formal market.


“There are some users who demand a higher percentage of THC or more variety, and this conspires against the effectiveness of the system because it determines that some users who could buy in pharmacies look for other options on the regulated market or on the black market”, says Daniel Radio, secretary -general of the National Board of Drugs.


Joaquín, the fictitious name of a cannabis consumer who buys on the black market, says that it is difficult to get marijuana without making an appointment to pick it up at the pharmacy, and for the illegal market he only needs to have a contact, make an appointment and buy.


In addition, licensed pharmacies are few in relation to the total population, and difficulties in accessing the financial system persist due to international legislation (ie, it is difficult to buy marijuana with a credit card or debit card).


The issue of privacy also affects consumers: to have access to the legal market, it is necessary to register, which some users prefer to avoid.


In the case of clubs, there is a limited number of members (between 15 and 45). There are waiting lists to get in.


“Pulla”, nickname of the treasurer and technical manager of a cannabis club in Montevideo, says that the waiting list “is an indication that the demand is not being met. There are many more people wanting to access the legal market that still cannot.”


The rule also establishes that the collection of each member cannot exceed 40 grams per month and, in many cases, there is also a minimum.


In the same way that consumption was normalized, the perception of the illegal market also changed. Specialists indicate that the main suppliers of the market are the local growers.


Agus, the fictitious name of a 28-year-old consumer, explains that she registered to buy cannabis in pharmacies, but now purchases the narcotic on the black market at the same time as she grows her own plants, without being registered.


“I don’t see it as a black market. I understand that it’s close, it has good prices for what it sells and it doesn’t seem that people are resorting to drug trafficking”, he says. There is “a friend or acquaintance who gives you the contact of someone who has flowers and sells them”.


According to Marcos Baudean, a professor at the ORT University of Uruguay and a researcher on the Monitor Cannabis project, “there are many more domestic growers that are not on the register”, and therefore it is not possible to make a concrete estimate of the scope of the black market.


Despite this, the professor assures that the unregistered growers “have already surpassed” the trafficking networks in the sale of cannabis. Despite this, traffickers are still present in Uruguay, mainly selling what they call ‘paraguayos’, cheaper marijuana presses.


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