Connecticut’s cannabis industry is confronting rising operational costs due to new tariffs on Chinese imports imposed by the Trump administration. These tariffs, now reaching up to 125% on certain goods, are affecting essential components and equipment used in cannabis cultivation and retail operations.
Impact on Infrastructure and Equipment
David Salinas, co-owner of the Hi! People Cannabis Market in Derby, reported that his team had to expedite purchases of essential infrastructure components, such as lighting and HVAC systems, to avoid a projected 35% cost increase. Salinas noted, “We don’t even have our building permit yet and we had to pre-purchase our electrical lighting package last week to avoid a 35% increase in cost.”
Packaging and Vape Hardware Challenges
Ben Zachs, owner of Fine Fettle dispensaries, highlighted that packaging materials and vape cartridges are particularly affected, as many are manufactured in China. “The biggest one that we’re seeing very quickly is around packaging. A lot of paper and packaging is made in China and abroad,” Zachs stated. He also emphasized the impact on vape cartridges, noting, “The other really big impact is vape cartridges, because the vast majority of vapor cartridges have components or parts made in China.”
Operational Adjustments and Market Implications
Rino Ferrarese, president of Affinity Grow, a Connecticut-based cultivator, mentioned that even large equipment like induction seals and conveyor belts are sourced from China. He expressed concerns about the increasing costs and the potential need to pass these expenses onto consumers. “There were questions of reliability, serviceability, etcetera, but now it’s different,” Ferrarese said, referring to the improved quality of Chinese-manufactured equipment.
Zachs also pointed out that while some businesses might absorb these costs, others may have to increase prices, potentially affecting competitiveness, especially given Connecticut’s already high cannabis prices compared to neighboring states like Massachusetts.
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