Puro Managing director Tim Aldridge , right, pictured with director Sank McFarlane have applied for a licence to grow medicinal cannabis for commercial purposes.
A Marlborough medicinal cannabis company expects it could create hundreds of jobs amid the expected coronavirus recession.
After the Medicinal Cannabis Scheme came into effect on April 1, Marlborough company Puro is waiting on the Ministry of Health to approve its licence application so it can begin the next phase of development.
Puro Managing Director Tim Aldridge said its operation had the potential to create 375 full-time jobs in the region in the next two years, but the company would need capital and licence approval.
“We are asking government for some assistance to allow us to create these large number of jobs in Marlborough and to pick up some of the sizeable unemployment that has come up from some industries having a really tough time,” he said.
Aldridge said it had submitted a license application on April 7, the day after the applications were released by the ministry. On Wednesday it received confirmation of the application but were still waiting on a licence to begin work.
The ministry originally suspected the licencing process would take four to eight weeks, but there would likely be delays due to the coronavirus pandemic.
While he recognised the Ministry of Health had an “enormous amount on its plate”, Aldridge said fast tracking medicinal cannabis licences would enable the company to create economic growth in the region.
“The Ministry of health are doing a fantastic job in general so we’re very understanding that delays are inevitable,” he said.
“[But] we’ve obviously got a few concerns that delays are going to cost jobs, so the quicker they can do this, the better for everyone.”
The jobs created by Puro, which could eventually reach 500, were in areas in which Marlborough already had “phenomenal talent” due to the wine industry, such as growing and cultivating.
The company believed the sites had the capacity to become the country’s largest grower of medical cannabis and hemp, due to Marlborough’s high sunshine hours.
Aldridge said Puro was operating in a state of limbo. They had been approved to grow medicinal cannabis last year for research purposes only under the old scheme.
With the Medicinal Cannabis Scheme coming into effect earlier in this month, enabling the commercial cultivation of cannabis for medicinal use, it was waiting on the new licence that would expand their operation.
“That’s what we’ve submitted this month to allow us to grow cannabis in our facilities for commercial purposes, which allows us to employ people,” he said.
The company was also establishing a headquarters at its Waihopai Valley site, opposite the spy base, 20km outside Blenheim. It had a building consent process underway for the multi-million dollar facility, which would have a medicinal cannabis research centre, an indoor cultivation facility and a large farm.
The company had a second growing site at Kekerengu, located across State Highway 1 from The Store, and began planting three hectares of low-THC content hemp last December.
Aldridge said the Covid-19 pandemic had not affected medicinal cannabis like it had other industries. Globally there had been an upswing in demand and a “positive movement in pricing.”
A report from The AgriBusiness Group said the market could be worth $379 million each year if just one per cent of New Zealanders used medicinal cannabis. Internationally, the total cannabis market was estimated to be worth US$150 billion.
“The ability for us to grow and our demand is still there but the biggest impact that we have had as a company and as an industry is access to capital is heavily restricted,” he said.
“Capital markets have been spooked and capital has dried up to a degree.”
In spite of raising $4 million in start-up funding last year, Puro was still eager to hear from investors and said government funding would also be “essential” to its success.