Filling in the blanks. An estimation of illicit cannabis growers’ profits in Belgium

BackgroundAs 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.MethodsReal-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).FindingsFinancial 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.ConclusionSeizure 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.