“Let us be blunt: TSA officers DO NOT search for marijuana or other illegal drugs. Our screening procedures are focused on security and detecting potential threats.”
^ The Transportation Security Administration (TSA) issued a statement on its Instagram account reaffirming its policy regarding cannabis possession on flights: It doesn’t allow it, but it’s not the administration’s priority to search for cannabis products. Source: TSA/Instagram
“We might in fact have false positives or maybe even false negatives. It’s just not accurate.”
^ As Vermont lawmakers continue to debate whether to legalize the production and sale of adult-use cannabis, impaired driving has become a hot-button issue. Rep. Maxine Grad, D-Moretown, the chair of the Vermont House Judiciary Committee, raised concerns about the accuracy of the available roadside technology for testing cannabis impairment during one of her committee’s hearings. Source: New England Cable News
“We also feel we have been deceived. As a result, no matter what we do as an organization going forward, Open Cannabis Project will never escape this deception.”
^ Former Open Cannabis Project Executive Director Beth Schechter announced on May 6 that the nonprofit organization would be shutting down by the end of the month. This announcement follows vast breeder and grower outcry over Phylos Bioscience announcing its own breeding program, contradicting what the company has, for years, told cannabis breeders and growers who shared their genetics with the ag-tech company. Source: Statement from Beth Schechter/Medium
In this issue, you’ll find Cannabis Business Times’ fourth annual “State of the Industry Report: Examining the Cannabis Cultivation Market.” (Thanks to Nexus Greenhouse Systems for supporting this third-party research for four years running, so that we can share it with you.) We are thrilled to now have years of data to analyze and compare to reveal trends and other important insights into this ever-growing industry.
As we reviewed the data and prepped the rest of this issue for press, It struck me that another less-quantifiable trend is happening in the industry. Commonly held practices and perceptions in cannabis cultivation are being questioned—and either are being proven or disproven.
Until recently, cannabis’s illegality prevented experienced researchers and horticulture experts, with vast scientific knowledge of all plant varieties, from researching cannabis. With legalization comes the benefit of contributions from these experts to add to the centuries of insights that have emerged from cannabis cultivation experts, who were forced to share their expertise largely by word of mouth and, more recently, in online forums.
With legalization, more information is being revealed, causing debates over previously held beliefs and practices surrounding cannabis cultivation.
Let’s start with “flushing,” a common cultivation process. More than three years ago, in CBT’s April 2016 issue, then-columnists Kurt and Kerry Badertscher wrote: “To us, the concept that flushing somehow changes the chemistry in plant tissue that has been laid down for weeks requires a scientific explanation because that concept seems akin to claiming that the car engine is cleaner after washing the car’s hood. Nutrients are locked in the plant, and an external flush cannot undo the complex biology that locked them in.”
In this issue, not only is flushing explored—and whether it is achieving what you think it is—but so is another commonly held belief about white ash being a sign of superior quality or “clean” cannabis. Dr. Markus Roggen and Dr. Allison Justice (who both have extensive experience in cannabis cultivation, curing, processing and more), deconstruct both concepts. The results will likely surprise you.
We are dedicated to continuing to question these commonly held, but scientifically unproven practices and beliefs in our coverage to help you navigate a once hidden industry’s emergence and progression.
It is a formidable as well as extremely exciting time as we begin to bridge the gap between cannabis cultivation practices and horticulture science. And it will be even more exciting to see how this bridge might impact your crop quality, characteristics, yield, and your bottom lines.
Given that Oregon’s cannabis reserves reportedly are more than six times its yearly consumption rate, interstate commerce seems like a logical solution to the state’s oversupply issue. (Also being considered is allowing on-site sales directly from farm-to-customer, therefore bypassing the dispensary, and another bill (S.B. 218) that would halt the issuance of new licenses during the glut.)
The Oregon Senate's passage of S.B. 582, the interstate commerce bill, and the related efforts to get it passed can be summarized as a call for a free-market economy. That call makes me wonder what the cannabis industry would look like if it operated as a regulated free market where the product, produced legally in one state, can be shipped to any other legal state. Odds are the West Coast would rule the market.
But what if the cannabis industry was a truly free market product, coming with all that entails? Given that is what we are all fighting for, it might be good to start thinking about our rapidly approaching new reality.
Free market is defined as a system in which the prices for goods and services are determined by the open market and by customers. It can be assumed that, in a free market, a majority of consumers will consume the most cost-effective cannabis, meaning they will gravitate toward the highest quality products offered at the lowest possible prices. To be competitive in that type of market, growers need to have their production costs in check.
So, what is the cost of production in Oregon versus other states? Specifically, what is the difference in production costs in a climate perfect for cannabis cultivation, such as Oregon, versus cannabis produced in the desert, such as in Arizona or Nevada? Or at a 5,000-foot elevation, or next to a Great Lake that experiences lake effect snow in the winter? The extreme seasonal swings in those areas will demand more environmental control inputs, whereas growers in Oregon, Washington or California have a near ideal climate naturally and should be able to reduce the use of environmental control inputs such as air conditioning, dehumidification and heating.
In this regard, Oregon and the entire West Coast seem well positioned to compete with growers in different states when it comes to cost of production.
Additionally, Oregon, Washington and California would have a head start on the market, as they have a strong reputation for producing quality cannabis. In fact, many of today’s popular cultivars were bred there or are directly linked to genetics from those states, and consumer favorites often hail from the Pacific states.
Indeed, West Coast cannabis is revered and respected worldwide and has been for many years. California has many specific appellations within counties such as Mendocino and Humboldt. Along with Trinity County, these counties make up the world-renowned Emerald Triangle. Some farms there are today cultivated by third- or even fourth-generation cannabis growers.
Some of those legacy cannabis growers are migrating to the California Central Valley in areas where cannabis production is allowed. The latest cannabis cultivation trend is the retrofitting of currently existing flower production greenhouses, of which there are thousands throughout central California, covering tens of millions of square feet of production capacity.
That’s not counting the acres upon acres of some of the most fertile soil on Earth, ready for outdoor hemp production.
The Global Hemp Factor
Interstate cannabis commerce comes with interstate hemp commerce. And when it comes to domestic hemp production, whether it be for CBD, fiber or food, no one is going to top California.
California is an agricultural juggernaut. It has a relatively tepid climate in the Central Valley, which is capable of producing a crop of one form or another year round, and is commonly referred to as the “World’s Fruit Basket,” a name well-earned, as it produces more fruits, nuts and vegetables than any other place on Earth. An ideal climate and decades of experience growing crops at scale results in the Central Valley having a low cost of production at commercial scale compared to other geographic locations.
Besides the climate and brainpower advantages, California is the world’s fifth largest economy, surpassing the U.K., and the California agricultural industry generates billions of dollars toward the state’s GDP.
Most of that revenue is generated by commercialized industrial agriculture, aka “big AG,” with much of the product being exported to other state or international markets.
When it comes to hemp, however, I suspect California and other U.S. farmers are going to be supplanted by producers in other developed emerging markets such as China and Colombia. These countries have already begun to stake claim to the hemp market and are expected to play a role in hemp cultivation and CBD refinement in the years to come, thanks to lower production and labor costs.
The looming global presence in the hemp market makes me wonder whether the lifting of the ban on interstate commerce would somehow legalize the importation of high-THC cannabis and CBD-rich hemp or their derivatives. In all practicality, interstate commerce is regulated by the federal government, and any action to legalize interstate commerce would probably have to follow the path toward legalized cannabis.
Many business plans and proposals put forward by several publicly traded companies (mostly Canadian) have provisions for the import and export of marijuana, hemp and their derivatives. Some intend on producing in countries such as Colombia, Portugal, Greece, Australia, New Zealand and others, all with the intent to be able to export their products to Europe and any other countries that allow for importation.
Indeed, much like any other commodity, I believe it will be hard to compete with foreign-produced cannabis products, whether they are cannabinoids, terpenes or plant fiber. Recently, I have seen Chinese extraction facilities capable of extracting 80 tons of hemp per day, which is astronomical by today’s standards. If that is tomorrow’s big AG, how can today’s hemp farmer or CBD refinery compete?
The implications of a free-market cannabis economy are many, and growers will be left to figure out what will happen when there is a major influx of West Coast cannabis available across the country for a lower price because of West Coast producers’ lower cost of production. Just as important as dealing with the West Coast is preparing to handle an influx of foreign-produced cannabis available for a substantially lower price.
Free Market Opportunities
This is not to say there will not be immensely successful companies in all state markets. But the successful companies that don’t have a West Coast or global footprint will be companies that have another strategic advantage, whether it be desirable proprietary genetics, superior brand recognition, proprietary intellectual properties, superior products for a superior price, etc.
Finding which of your company’s distinguishing features resonates with customers is every brand’s challenge. Will customers desire, care about or respect the history of West Coast-grown cannabis? Or will a majority of consumers only care about the lowest price regardless of where, by whom or how it was produced?
That said, as proven many times over, a certain segment of the consumer populous always wants the best, no matter the cost (to a point). This customer is educated in all things cannabis and cares deeply about how a plant was grown or how an extract was produced. This customer demands cutting-edge products that truly express the flavor and aroma of a given cultivar. This customer cares that a product was produced both organically and sustainably, does not want to compromise quality in any fashion, and, again, they’re willing to pay for it.
Businesses that cater to this customer will inevitably be successful, and no matter where it is produced, that product will be desired in all geographic locations, including the West Coast.
Kenneth Morrow is an author, consultant and owner of Trichome Technologies. Facebook: TrichomeTechnologies Instagram: Trichome Technologies email@example.com
A colleague of mine recently took a job in an industry where he no longer had a greenhouse to care for and was feeling the challenge of learning new things. In his former job, he said, even if a meteorite fell onto his greenhouse, he would know exactly what to do, step by step, to return the chaotic environment to normalcy. He wasn’t bragging about his abilities as a greenhouse manager, but instead was making a point about the importance of experience in decision-making.
I felt his pain—after some years managing greenhouses at Purdue University, I eventually reached that same level of decision-making confidence in normal and chaotic moments at my own facility. What I have learned in three decades is that cultivating plants is a challenge hardly matched in other business sectors, as we are producing perishable products in a dynamic physical environment, cared for by fallible human beings. Even within our own agriculture sector, cannabis production is much more stringently regulated than other crop production, requiring more careful choices at every step. By contrast, nuts and bolts don’t wilt, aspirin pills are cranked out by machines, and software code can be saved indefinitely and re-opened.
That being the case, decision-making is that much more vital in a dynamic environment with live plants. You can optimize your decision-making environment just as you would in a pharmaceutical, manufacturing or tech field, to ensure best crop outcomes.
According to experts, one goal should be to reduce the number of decisions you have to make each day so you can concentrate on the ones that matter most. The best way to do this at work is to delegate decisions just as you would tasks. For example, a trusted assistant could sketch out a list of Tuesday’s priorities at the end of the day Monday.
Much can also be done to reduce your decision load even before your work day begins. Scan your electronic communications in the morning to ensure there are no urgent messages. This will help you resist the temptation to be drawn into these messages when you first arrive to work. That time should be set aside for a walk-through to prioritize tasks.
During this quick scan of the facility, take notes on tasks using your phone or a notepad. From these notes, prioritize your day based on this order:
When walking through your facility, identify hazards that could injure people. Those need immediate attention. This seems obvious, but remember you are scanning for both large and small hazards, such as a worker not wearing goggles around chemicals.
Safety of plants is your next concern—are any plants at immediate risk due to temperature or water stress? This is not checking for optimizing plants, which you’ll do later. This is a quick scan to make sure nothing catastrophic is about to take place.
You are also looking for problems that put your facility at risk. Uncommon odors or noises coming from equipment, unusual amounts of condensation, doors chocked open, etc. Again, this is not preparing a maintenance list, just a flash inspection.
If your walk-through indicates no safety problems, move on to the questions or needs of your employees or your customers. Dedicating time early in the day to your employees will empower them to make decisions on their own, reducing your own decision load. Likewise, your customers or the people you report to need to know that you will respond quickly to them if they’ve contacted you. You don’t have to resolve every issue completely, especially if you have crop needs to address, but at least reply, and if it is going to take longer than you can spend at the moment, ask them if you can finish with them later in the day and tell them why. Most understand you are prioritizing plant health for their benefit.
One way to make better decisions during the rest of the day is to slay the dragon: Do the job involving plants that you most dread doing. Maybe it’s mixing fertilizer, conducting pour-through substrate analysis or mailing tissue samples. If you don’t finish all of it, at least get most of it done. You will feel lightened and more creative, rather than dreading it all afternoon.
A second part of managing crops is making all the decisions that are required to schedule supplies and workers to come together for the next crop task or cycle. This is truly the unsung work of managers because you are holed up in your office doing behind-the-scenes work. You would prefer to be making decisions about the current crop, but not doing these tasks will lead to bedlam for that future crop, with short-staffing or idle employees, or short supplies. Because you completed these same tasks a month ago, today you will have time to spend with your cultivation team, making the decisions about watering, fertilization and unique applications of light to optimize your crop.
Your decision-making ability is a limited resource and needs to be preserved. A law of diminishing returns applies. As you tire, decision making becomes more difficult and prone to error. That is why the final word in my order of tasks is “administration,” as these tasks often don’t require critical decision making: following-up with customers or stakeholders, repairing equipment, filling in for a team member, record keeping and answering all those emails you resisted earlier in the day.
Some managers make better decisions later in the day. There is nothing wrong with reversing the order above as long as you are not holding your team up. For example, you might prefer to do your walk-through and planning for the following day after most of the team has gone home and fewer distractions exist. Either way, your goal is to manage your decision-making environment, starting even before you arrive on site, to reduce and prioritize your decision load.
Here are some specific decision-making tips for managing crops, facilities and employees:
1. Measure the Success of Your Decisions. You’re probably already rationalizing your decisions in case someone asks; why not jot those rationalizations down along with how you came to the decision? Come back to it a month later. Or ask for input from your team. They may hold back their opinions while you’re making a decision, but a month later will tell you what they’ve observed as a result of it. Patterns may emerge from this measurement, such as discovering that decisions that you made collaboratively tend to be more successful.
2. Verbalize the Problem. Having difficulty making a decision? Talking it out can make a solution clear. Occasionally, when seeking the advice of my technician, I would answer my own question by the time I had finished describing the problem!
3. Develop “Averted Vision.” This is a term most often used in astronomy that describes seeing a very faint star with the naked eye by using your peripheral vision and focusing just to the side of the object instead of looking straight at it. In a greenhouse, this translates to: If it’s not an urgent problem, do another task for a while to clear your head. How many times has a solution come to you driving home from work or at home in the shower? This is averted-vision problem-solving at its finest.
4. “Don’t Let the Perfect Be the Enemy of the Good.” If you favor perfectionism, which is common in managers, this Voltaire quote can be useful to hasten today’s decisions. Doing everything as well as you can in the given time frame will create a better product than completing most steps perfectly and one or two poorly because you ran out of time. This is why your teachers told you to try to answer every question on an exam and then double check them, rather than getting hung up on one question and risk not finishing.
5. With Plants, First, Do No Harm. Making decisions in a panic can lead to overly aggressive action, such as spraying a pesticide before testing it on a few plants or tripling the dose of a micronutrient. Any action you take must first and foremost not be detrimental to your crop.
6. Remember, There Are No Silver Bullets. Avoid decisions based on an anecdote or claim that this one input change is going to solve all your problems, such as preventing powdery mildew or increasing yield of every cultivar.
7. Follow the Data. Before deciding on a cultivation change, run a test. Control the experiment so only one variable is being changed between your control group and treatment(s). Test at least two cultivars. Be patient enough to repeat the test a second time to confirm—this is vital and often overlooked. To better understand results and perhaps gain buy-in from your team, ask them to evaluate the completed study. Label the treatments so they can come to their own conclusions.
8. Err Toward Flexible-Use With Your Facility. For example, I typically do not like to bolt down tables or hard-wire lighting fixtures, in case I reconfigure the grow room later. Build wide doors and corridors to get future equipment in. When in doubt on design decisions, fall back on flexibility.
9. Design for Maintenance. Architects have rarely worked in a plant growth facility, and general contractors will only follow their blueprints. A grower needs to be on the design team to make sure that, for example, the shade curtain in a greenhouse will not be blocked by the structure and conduit, making it nearly impossible to reach for repairs, or to remind architects that grow rooms should be designed to be pressure washed and disinfected between crops.
10. Teach the Ignorant; Punish the Noncompliant. When trying to decide how to handle an employee error, remember that if they weren’t properly trained, it is your fault. Also, some mistakes are honest ones. A reprimand is not justified until they are knowingly noncompliant.
11. Don’t Hit Send. If you’re feeling emotional, decide to send that hot email or text you wrote after you’ve cooled down. In fact, a good policy is that electronic communications should only be used for neutral or positive responses. Pick up the phone or visit the person face to face to deal with issues.
12. Decide to Take Responsibility When Bad Things Happen. Accepting the blame, apologizing and fixing the problem can build trust with employees, customers or shareholders better than if nothing had ever gone wrong. Sometimes, you need to take the blame for the greater good—even when the blame is not yours.
The best decision-makers I know conduct themselves with behavior beyond reproach and with a realistic, yet relentless, positivity. They set a tone that decisions are made based on the organization’s values, provide an example to employees, and also quietly bring in their own ethical code, knowing these are the actions that speak louder than words. They are the type of people who decide to start picking up the pieces when a meteorite hits their facilities.
Robert Eddy is director of Ag Projects for Core Cannabis in East Lansing, Mich.
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