In Cannabis Business Times’ second annual “State of the Growing Environment” Report, research participants indicated that their greatest cultivation challenge is pest and disease management. About a quarter of growers attribute outbreaks to unbalanced humidity, and this year’s report provides insights into how growers are using environmental controls to manage plant growth while preventing and mitigating outbreaks. More data is available in the special report here.
The research results not only help the CBT team produce this report and provide the industry with useful benchmarking data and information about key aspects of cannabis cultivation, but it also helps drive the editorial content in the magazine.
For example, using the results of the study, we developed complementary articles in the report to address some of the key concerns cannabis growers indicated they have. Washington-based Grow Op Farms details its strategy to prevent pest and disease using environmental controls and Portland’s Meraki Gardens explains how a balanced airflow mitigated fungus gnat pressure. How to establish standard operating procedures (SOPs) for an effective integrated pest management (IPM) plan is also addressed in this issue’s Hort How-To column, written by Christine DeJesus.
Getting feedback from research, conversations and interviews with business owners and cultivators is essential to CBT’s mission of providing the most useful and relevant content to help growers solve problems so that they can ultimately produce higher, healthier yields and greater profits.
This information is also useful for planning our highly anticipated Cannabis Conference, which will take place Aug. 24-26 at Paris Las Vegas Hotel & Casino. Working in close collaboration with our 2021 Cannabis Conference Advisory Board, in addition to noting your questions and concerns through our conversations and in our research studies throughout the year, helps us better understand what educational sessions we should prioritize. We’ve developed a varied program that includes speakers who are leaders and experts in the industry. At this moment, we are finalizing topics that address the most pressing issues and opportunities facing businesses and cultivators, thanks to feedback from many. Our educational program is now available at cannabisconference.com.
More opportunities for you to contribute to our research reports will be coming up soon. And my email address is always included on this page, and contact information for the entire team is in our masthead. We’d love to hear from you and learn more about your business. The more we know, the better we can accomplish our primary mission and our reason for being here—to serve you.
More than a few migraines were set off in late January and early February this year, when non-professional traders squeezed long-held short positions on unsuspecting stocks like GameStop, Nokia and AMC Entertainment Holdings. More than a few windfalls were cashed out, too, creating dozens of overnight millionaires.
The saga sparked an interesting conversation about the shape of public trading, particularly with the advent of crowdsourced intel from the r/wallstreetbets page on reddit.com amassing against well-heeled hedge funds. For Tilray CEO Brendan Kennedy, the narrative prompted flashbacks.
“I’ve had a little bit of PTSD over the last couple of days,” Kennedy said on CNBC in late January. “I remember getting five different calls from Nasdaq in a single day about our stock being halted because the short sellers were being squeezed so badly.”
He was referring to August and September 2018, a fleeting moment when traders drove Tilray’s stock price from about $24 to a high of $300 per share—before the next year or so slowly spiked the price back to the floor.
Let’s back up: In basic terms, a “short” is a bet that a stock price will decline. A “squeeze” is one possible reaction to short plays, when purchase volume increases rapidly and puts pressure on those plays. In the case of Tilray, ca. 2018, that’s one interpretation of what happened. The financial lingo became household terms during the GameStop flurry earlier this year. But the squeeze can generate its own feedback loop, wholly divorced from the companies in the conversation.
As traders sought out fresh fodder for quick trades this past month, riskier market segments took their turn in the spotlight: crypto, tech, cannabis. As February ticked onward, traders juiced the stock prices of several public cannabis businesses.
The rally built its momentum on the back of a Feb. 1 announcement that U.S. senators plan to consolidate cannabis reform legislation “in the early part of this year,” as well as the blockbuster $7.2-billion deal cut between Jazz Pharma and GW Pharma. Excitement was in the air, as it tends to be with this industry.
Tilray shares leapt 23% the next day. From there, the price skyrocketed another 172% before tumbling Feb. 11. As of Feb. 15, Tilray was trading at $29 even.
Other oft-cited Canadian cannabis stocks (Aphria, Aurora, Cronos, Canopy) each saw their own sudden downturn in mid-February. Market observers, including Ihor Dusaniwsky, a managing director at short-selling analytics firm S3 Partners, have noted in recent weeks that traders should expect ongoing volatility in the cannabis sector. As of mid-February, short positions remained hefty on major cannabis stocks.
Kennedy leveled with the industry’s C-suite during his CNBC appearance: “My advice to those CEOs would be that, at times like this, your company is not your stock, and your stock is not your company. Keep it all in perspective as these very unusual market dynamics are taking place.”
The long view is similar to the short view here: Buckle up and maintain a clearly defined set of corporate values. It’s going to (continue to) be a wild ride.
Eric Sandy is digital editor of Cannabis Business Times, Cannabis Dispensary and Hemp Grower.
In April 2019, Lume Cannabis Co.’s 50,000 sq. ft. cultivation facility in Evart, Mich., came online. In less than two years, the company, founded by a group of Michiganders, has launched 15 stores across the state. When founder and CEO Dave Morrow, who started Warrior Sports in 1992, asked his Warrior colleague and friend Doug Hellyar if he wanted to join him in his new endeavor, Hellyar said it was a “once in a lifetime opportunity.” “It’s the birth of a new industry, and that happens very rarely, so to be a part of that … and build something from scratch is always exciting,” says Hellyar, president and chief operating officer.
Since its launch, Lume has been rapidly expanding, despite the challenges of the COVID-19 pandemic, and soon will unveil its new 85,000 sq. ft. cultivation expansion. Two more 85,000 sq. ft. additions are planned in the future to meet the demands of the expanding Michigan market. Cannabis Business Times spoke to Hellyar to find out what’s next for the burgeoning business.
Michelle Simakis: You have 15 dispensaries listed as “coming soon” on your website, in addition to the 15 already open. What is the timeline for that expansion?
Doug Hellyar: The goal is to be well north of 30 stores by the end of the year. We opened one store every five weeks last year. And the goal was to double that pace. But right now, a lot of that’s going to happen in the second half [of the year]. But if we end up with 35, it’ll be a great year for us.
MS: How did you manage to keep up that pace, especially considering the challenges of COVID-19?
DH: We’re classified as an essential business, so we were able to keep the stores open. We had to transition immediately when we had to close the stores and only sell curbside and delivery. That was a big shift, but fortunately, we were able to stay open, and that’s how we were able to fund the ongoing expansion. It was a several months delay, but then we were able to pick up the pace again in the second half.
MS: What is the strategy behind that fast approach? Are there plans to expand outside of the state?
DH: Our goal is to be the No. 1 brand in Michigan. And we felt speed is essential to that. If a municipality is opting in, we are going to apply, and wherever we apply and we win, we’re going open a store. So that was basically the strategy. And we have a team that’s dedicated to simply the application process and the acquisition of real estate, completing the very comprehensive applications. That’s why we’ve been moving so fast and been successful, and we’ve been able to fund it because of the acceptance of our brand and the success of our stores and the support of the customers. Currently the focus continues to be on Michigan. We are committed to serving every citizen in every corner of the state.
MS: There are still many municipalities that did not opt into cannabis sales in Michigan. How did you navigate that barrier to expansion?
DH: It has been a problem in certain parts of the state. For example, the greater Detroit area, they’ve been slower to opt in than many other parts of the state. What we’re seeing, though, is a trend towards more opting in over time. Concerns about crime escalating when cannabis stores open up in town, those are dissipating because where we do operate, they’re seeing it’s having a positive impact on the community. People are coming into town, they’re spending their dollars elsewhere, too. I think more communities are going to opt in, particularly as businesses continue to be restricted in how they can be open. This is another revenue opportunity for the municipalities.
This interview has been edited for length and clarity. Michelle Simakis is editor of Cannabis Business Times.
Cannabis Business Times’ interactive legislative map is another tool to help cultivators quickly navigate state cannabis laws and find news relevant to their markets. View More