int J Drug Policy. 2014 May;25(3):436-43. doi: 10.1016/j.drugpo.2014.01.020. Epub 2014 Feb 10.
Abstract
BACKGROUND:
As
a result of increased pressure on cannabis cultivation in The
Netherlands, the number of confiscated indoor cannabis plantations in
Belgium is rising. Although increases are reported for all plantations
sizes, half of the seized plantations contain less than 50 plants. In
this study, factors and variables that influence costs and benefits of
indoor cannabis cultivation are investigated as well as how these costs
and benefits vary between different cannabis grower types.
METHODS:
Real-situation
data of four growers were used to perform financial analyses. Costs
included fixed and variable material costs, as well as opportunity
costs. Gross revenue per grow cycle was calculated based on most recent
forensic findings for illicit Belgian cannabis plantations and was
adjusted for the risk of getting caught. Finally, gross revenues and
return on costs (ROC) were calculated over 1 year (4 cycles).
FINDINGS:
Financial
analysis shows that in all cases gross revenues as well as ROC are
considerable, even after a single growth cycle. Highest profitability
was found for large-scale (600 plants, ROC=6.8) and mid-scale
plantations (150 plants, ROC=6.0). However, industrial plantations
(23,000 plants, ROC=1.4) and micro-scale plantations (5 plants, ROC=2.8)
are also highly remunerative. Shift of police focus away from
micro-scale growers, least likely to be involved in criminal gangs, to
large-scale and industrial scale plantations would influence costs as a
result of changing risks of getting caught. However, sensitivity
analysis shows that this does not significantly influence the
conclusions on profitability of different types of indoor cannabis
growers.
CONCLUSION:
Seizure
and confiscation of profits are important elements in the integral and
integrated policy approach required for tackling illicit indoor cannabis
plantations. The large return of costs evidenced in the present study,
underpin the policy relevance of confiscating those illicit profits as
part of enforcement.
Copyright © 2014 Elsevier B.V. All rights reserved.
KEYWORDS:
Cannabis; Price setting; Profits; Rate of return on costs; Snowball sampling
