Micro Processing Licence in Canada 2026: The 2,400 kg Limit, Facility Layout, and Compliance Checklist

If you want to package flower, make pre rolls, press rosin, produce extracts, or manufacture finished cannabis products in Canada, you are in processing territory. For many new operators, the micro processing licence is the fastest way to get a compliant facility running without the scale and overhead of standard processing.

As of the streamlining changes that came into force on March 12, 2025, micro processing now comes with a much more usable annual possession limit: up to 2,400 kg of dried cannabis (or equivalent) in a calendar year. Canada+2www.gazette.gc.ca+2

This guide breaks down what micro processing really allows, how the 2,400 kg rule actually works in practice, and how to plan your facility layout and documentation so you are building an operation, not just a room with equipment.

What a Micro Processing Licence Allows (In Plain English)

A micro processing licence allows you to produce cannabis, but not by synthesizing it and not by cultivating, propagating, or harvesting it. Canada+1

In real terms, micro processing is used for things like:

• Drying and curing (when you are processing inputs)

• Milling and preparing dried cannabis

• Packaging and labelling finished products

• Making extracts and infused products (with the right compliant setup and controls)

• Manufacturing and preparing products for sale, depending on your licence scope and what your site is built to safely do

If your site is also licensed for micro cultivation at the same location, you can run a tight cultivation plus processing model. Just remember, the possession rules still matter the second you bring in outside material.

The 2,400 kg Possession Limit: What It Really Means

1) It is an annual calendar year limit

The Cannabis Regulations set the micro processing limit as the total amount of cannabis received (sold or distributed to you) in a calendar year, calculated using the equivalency table, that is equivalent to more than 2,400 kg of dried cannabis. Department of Justice Canada+1

2) It is based on “equivalency”

Not everything you handle is dried flower. Oils, extracts, edibles, and other classes are converted using the equivalency table in the Regulations for the purpose of the limit. Department of Justice Canada+1

3) Inventory carryover still counts

Health Canada’s micro class guidance makes it clear that inventory carried over from the previous calendar year is included in the current year’s possession limit. Canada

This catches people. You cannot treat December as a free stocking month and pretend January resets the chessboard.

4) Plants and seeds do not count toward the possession limit

Cannabis plants and seeds are excluded from the micro processing possession limit calculation. Canada+1

5) The big exception: “only your own micro cultivation at the same site”

If the only cannabis you possess is cannabis grown from your own micro cultivation licence at the same site, the 2,400 kg rule does not apply. Canada+1

But the moment you bring in cannabis from other licence holders, the possession limit becomes real again, and you need to manage your annual intake carefully. Canada

Micro Processing Facility Layout: What You Should Build (And Why)

Micro processing succeeds when the building flow is designed like a clean operation. You want a simple, logical path that prevents cross contamination, prevents mix ups, and keeps your compliance paperwork easy.

A typical compliant flow looks like:

Receiving → Quarantine / Hold → Production → Packaging → Finished Goods Storage → Shipping

Here is the practical room checklist that most micro processors end up needing.

Core rooms to plan for

• Shipping and receiving (controlled entry, documented intake)

• Quarantine / hold area for incoming cannabis and packaging components

• Processing room(s) based on what you actually do (milling, infusion, extraction, pressing, drying, etc.)

• Packaging and labelling room (clean, organized, set up to prevent mix ups)

• Finished product storage with controlled access

• Waste storage and handling area with a clean, defensible workflow

• Sanitation and janitorial storage (separate from production materials)

• Staff change area / gowning style entry if your process warrants it

• Staff amenities (washroom, lunch area)

• Secure storage for inputs and high value items depending on your model

Design principle that saves you headaches

Do not design your process around your best day. Design it around your worst day.

Peak weeks are when errors happen: rushed label changes, rushed lot separation, rushed cleaning. A good layout makes it hard to do the wrong thing.

Packaging and Labelling: Plan It Early, Not at the End

Packaging and labelling is not a quick sticker job in Canada. Health Canada requires plain packaging rules, child resistant containers (with limited exceptions), and specific mandatory label content including health warnings, standardized symbol where applicable, THC and CBD information, and licence holder information. Canada

Also important: Health Canada does not pre approve your packaging and labels, meaning you need internal controls to ensure compliance before product goes out the door. Canada

Practical planning tip: build a small “label control” workstation into your packaging area with:

• approved label master files

• lot number rules

• changeover checklist

• line clearance checklist

• sample retain and photo log habit

This is one of the simplest ways to prevent expensive recalls and rework.

The Micro Processing Compliance Checklist (The Stuff That Gets You Through)

This is the baseline list to have tight before you push hard on production.

Licensing and site readiness

• Site evidence package that matches the real build

• Clear description of intended activities and rooms

• Written inventory and possession limit tracking method that matches the 2,400 kg framework Canada+1

Operational controls

• Batch and lot tracking system

• Receiving and quarantine SOP

• Sanitation program and cleaning logs

• Pest prevention plan

• Waste handling SOP and logs

• Deviation and incident documentation process

• Recall readiness and traceability mindset

Packaging and labelling controls

• Packaging spec sheets

• Label verification step and documented sign off

• Changeover and line clearance checklists

• Retain sample plan, if applicable to your operation

• Training logs for packaging staff on compliance expectations Canada

Micro Processing vs Standard Processing: When to Scale Up

Micro processing is the right move when you want to:

• stay lean

• move quickly

• build a compliant brand without massive overhead

• process a controlled amount of input each year

If your plan involves heavy third party intake, aggressive co packing, or large scale extraction throughput, you will eventually want to evaluate standard processing since micro processing is still tied to that annual possession framework. Department of Justice Canada+1

How 4trees Helps

Micro processing is one of those licence classes where the facility design and the paperwork need to be built together. The cleanest projects are the ones where the room flow, equipment list, and SOP framework all agree with each other.

4trees helps micro processors by engineering the site like an operation:

• facility flow design that prevents bottlenecks and mix ups

• processing room planning based on your actual product goals

• packaging and labelling workflow that is built for compliance, not stress

• possession limit planning so your intake strategy matches the 2,400 kg rule Canada+1

When your building, your process, and your records all say the same story, inspections get a lot less dramatic.