In the span of four months in 2018, Canada became the tenth country to federally legalize cannabis in some form, and Michigan, Missouri and Utah brought the total number of U.S. states with at least legalized medical cannabis to 33.
This graphic, courtesy of Gleam Law — a cannabis law firm servicing California, Oregon and Washington — shows exactly where cannabis is legal worldwide.
Industrial Hemp: Market Definition
Industrial Hemp, a variety of cannabis, is also known as Hemp or non-drug cannabis as doesn’t exhibit any of the psychoactive property as its cousin marijuana. Industrial hemp is an annual plant and is cultivated in over 30 countries across the globe. Industrial hemp is cultivated for its seeds and stalk which are used widely across various industrial sectors. Seeds of Industrial hemp are used widely by the food and personal care sector as well as by paint and chemical industry. The stalks of industrial hemp as used for production bast fiber and hurd fiber. The bast fiber is extensively utilized by the consumer as well as technical textile industries. The hurd fiber finds its application in construction, paper, and automotive industry.
Industrial Hemp: Market Outlook
The global industrial hemp market is expected to exhibit an attractive absolute dollar incremental opportunity of about US $ 12,949.9 Mn in 2027 over 2018. The Hemp CBD segment is expected to exhibit the highest CAGR across all the segments in the global industrial hemp market. North America is expected to be the most attractive market over the forecast period, followed by key regions such as Europe and the Asia Pacific.
By the product type, the seeds segment is expected to dominate the industrial hemp in the terms of value as well as volume attributing to increasing demand from hemp-based food as well as for hemp seed oil from paint and personal care industry. The fiber segment is expected to grow at a rapid pace in industrial owing to the increasing application and rising innovation from the automotive and textile industry.
In the global industrial hemp market, by end use, the hemp CBD followed by food and beverage segment is expected to dominate the market and exhibit the highest CAGR. The increasing demand for hemp CBD from healthcare and wellness sector for properties of CBD to treat anxiety as well as multiple health-related issues. The food sectors extensive used industrial hemp for salad dressing and cooking as well as for snack food in order to reap the highly nutritional benefits. Industrial hemp is used as a durable and cost-efficient source of fiber by the textile and automotive industry.
Among the nature segments in the global Industrial Hemp market, the conventional segment is expected to dominate in terms of volume, over the other segments, attributing to its lower price as well as easy accessibility in the various region across the globe. The preference for an organic segment is growing in developed and developing countries along with on-going Organic trend as well as increased spending capacity of the consumers. The organic segment is expected to show robust growth during the forecast period.
Industrial Hemp Market: Drivers and Restraints
Industrial hemp is an annual crop and shows its application extensively wide range of products. Rising population, changing lifestyle as well as increasing disposable income, have led to increasing in demand for sustainable as well as high-quality personal care and cosmetics, supplements and high nutritive food products prove to be the prominent driver for industrial hemp market. The increasing tendency of consumers to opt for products made from natural ingredients is driving the industrial hemp market.
Industrial hemp has used the production of paper, plastic as well as fiber material which is potentially used to replace environmentally harming products like tree paper, plastics material. The rising concern about the environment is driving consumers to opt for products made with renewable material like industrial hemp. Industrial Hemp shows its application as a durable and cost-efficient as well as carbon neutral alternative to insulation material used in various automotive as well as construction. The ever-increasing automobile as well as the construction industry, directly increases the demand for industrial hemp, hence driving the global industrial hemp market in a positive way. With the rising awareness along with an increasing number of applications almost in every sector, the demand for industrial hemp is expected to rise in robustly over the forecast period.
Erratic production and supply of raw material due the change in climate or other environmental factors is one the restraints industrial hemp market. The major production of industrial hemp comes from like 3-5 countries, any change policies or lawsuits about the production of industrial hemp in these regions can directly have a negative effect on the industrial hemp market.
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Industrial Hemp Market: Regional Outlook
By region, the global Industrial Hemp is segmented as North America, Latin America, Europe, Asia-Pacific, and Middle East & Africa. Europe and the Asia Pacific are currently the dominant players in the global industrial hemp market. The suitable environmental conditions and appropriate government policies along with a continuously rising demand for industrial hemp-based products from various sectors is fuelling the demand for industrial hemp largely in Europe and the Asia Pacific. However, despite unfavorable lawsuits about growing of industrial hemp in the United States of America, the North America region is expected to dominate the global industrial hemp market in over the forecast period. With rising awareness about the potential benefits and possibilities offered by the industrial hemp as well as changing government possibilities, as well as increasing demand for hemp-based products from food, personal care as well as automotive and construction industry, is expected to fuel the industrial hemp market in North America region. Latin America and Middle East & Africa are expected to exhibit a steady growth owing to its developing economies as well as rising food, personal care, and automobile industries.
While recreational cannabis is being touted as a potentially multi-billion-dollar industry, its cost to the environment is proving to be anything but green. Canada’s licensed producers are constantly on the lookout for ways to save on production costs, and substantial energy needs are a major obstacle.
However, with some of the country’s licensed producers building massive cannabis production facilities with indoor growing spaces measured in the millions of square meters, there is a renewed focus on making cannabis production affordable and sustainable.
In the United States, state-level cannabis producers have been dealing with the same energy problems as in Canada. According to a legal brief prepared by the National Conference of State Legislatures, a bipartisan, non-governmental organization to support state lawmakers, the electricity consumption of indoor growing operations is “staggering when compared to business and residential use. In 2015, the average electricity consumption of a 5,000-square-foot indoor facility in Boulder County [Colorado] was 41,808 kilowatt-hours per month, while an average household in the county used about 630 kilowatt-hours.”
Dan Sutton, CEO of Tantalus Labs is among an emerging group of business leaders looking to incorporate cleaner technology into Canadian cannabis production to reduce energy costs and apply modern farming techniques to growing cannabis. His Vancouver, British Columbia-based company predominantly uses sunlight in greenhouses to cultivate the product.
“It’s really been core to our whole philosophy, since its inception,” Sutton said. “Since we started conceptualizing cannabis in a greenhouse, it was really this intersection between creating a quality plant output, a quality environment for the plant to thrive, and a drastic reduction in energy usage.”.
The technology needed to grow potent cannabis indoors is constantly evolving, but many companies still favor enclosed, artificial-light-driven systems.
“Those lights take a lot of energy probably about as much energy per square foot as an operating theater,” Sutton said, noting that humidification, heating, and cooling require significant energy, especially in Canada.
“All of this electricity, it’s not incremental in a linear way. You’re having to add way more electricity in the cooling, and way more electricity in the humidification stuff, so it’s sort of borrowing from Peter to pay Paul,” Sutton said.
The energy requirements are increasingly becoming an issue for regions where cannabis is sold for adult use. Denver has committed to a large reduction in greenhouse gas production and the city’s Department of Public Health and Environment released a guide of best cannabis management practices that devoted nearly a third of the report to energy efficiency. The report notes that electricity use from cannabis cultivation and infused products manufacturing grew by 36 percent annually between 2012 and 2016. While Denver doesn’t have specific legislation to deal with cannabis’ energy demands, Boulder County “requires commercial marijuana growers to either offset electricity use with renewable energy or pay a $2.16 charge per kilowatt-hour” into an offset fund established by the county. Proceeds help fund initiatives to educate cannabis growers on reducing their energy consumption.
In Canada, producers such as Sutton believe the most sustainable balance is in large industrial greenhouses.
“When I grow a kilo of cannabis in California, it contributes to 46,000 kilograms of carbon emissions, so this isn’t just a bit energy, it’s one of the most energy-intensive productions industries on earth,” Sutton said. “It competes with … mining, which is crazy.”
Cannabis Greenhouses Might be ‘Greener’
Greenhouse growing can reduce energy demand compared with exclusively indoor operations, but not just because of the lighting. The infrastructure required to deal with the intense heat generated by the indoor light bulbs is also an added expense.
“You don’t need to cool in the same way [in a sunlit greenhouse]. You can use natural airflow and fans to distribute air and even if you’re using supplemental lighting, which is totally necessary in this part of the world, 90 to 95 percent of the light that hits that cannabis plant is coming from the sun.
“These plants go nuts in the sunlight. They grow more robustly, they’re less prone to disease, in their last days of flowering they create trichomes — this kind of sap that’s really laden with cannabinoids — and terpenes, which are the things that consumers of cannabis want to buy.”
“Last year, Reuters reported that the USPTO issued 39 patents containing the word cannabis during 2018 through late November. The USPTO only issued 29 such patents during 2017 and 14 during 2016.”
The shifting status of marijuana from an illegal controlled substance to regulated medicinal product to, in some jurisdictions, legalized recreational activity has created a market that promises to be incredibly valuable in the years to come. An April 2018 report from Grand View Research predicted the global market for legal marijuana products to exceed $146 billion by the year 2025. A 2018 cannabis report by Deloitteforecast Canada’s cannabis market to reach $7.17 billion in total sales during 2019, including $4.34 billion in sales of legal marijuana products. In the U.S., 2017 sales of legal recreational and medicinal marijuana products resulted in revenues of up to $6.6 billion, a fraction of the estimated $50 billion to $55 billion of total U.S. demand for recreational cannabis products.
Although Canada fully legalized both the recreational and medicinal use of marijuana last October, marijuana legalization is occurring more slowly and piecemeal in the United States. In the U.S., marijuana is still a Schedule I drug under the Controlled Substances Act, although medicinal use is legal in 33 states plus the District of Columbia and recreational use has been legalized in 10 states and Washington, D.C. However, even these slow moves in the direction of full legalization have galvanized inventors filing patent applications on cannabis-related inventions with the U.S. Patent and Trademark Office (USPTO). Last year, Reuters reportedthat the USPTO issued 39 patents containing the word cannabis during 2018 through late November. The USPTO only issued 29 such patents during 2017 and 14 during 2016.
Increased research and development expenditures among major cannabis producers are another indication that marijuana’s gradual legalization is spurring cannabis innovations. Canadian cannabis firm Canopy Growth indicated in its second quarter earnings report for 2019’s fiscal year that the corporation spent $1.94 million CDN on research and development for the quarter, a major increase from the firm’s $494,000 in R&D expenditures during Q2 2018. Similarly, Edmonton-based Aurora Cannabis reported that it spent $3.43 million CDN on R&D during the first quarter of 2019, up from $107,000 CDN during Q1 2018. Aurora also identified $2.35 million CDN in patent-related acquisitions since the end of July 2017.
Perspectives from Industry Insiders
Legal professionals in this realm are optimistic about the prospects for cannabis inventions, especially given the early stages of development in many cannabis sectors. Howard Cohn, chief patent attorney and managing partner at THC Legal Group, which is a cannabis-focused specialty division of Howard M. Cohn & Associates, said that, as the market for cannabis grows, he expects the push to obtain market share through patent holdings will only increase. “My gut feeling is that inventors will spend more time developing proprietary ways to integrate cannabis extracts into existing products and far less time attempting to obtain patents on unique strains of genetically engineered cannabis.” Cohn added that the food and beverage industry “is a natural partner for the cannabis space and will likely experience an explosion of innovation vis-à-vis cannabis oils. Cannabis enthusiasts should expect to see great advances in cannabis infusions and a variety of clever engineering moves designed to maximize the potency of the end-product with the least amount of raw cannabis material,” he said.
Michael Brubaker, patent attorney with Cannapatents, likened patenting activities in the cannabis industry to those occurring in blockchain technologies. “Those are two breakout industries that have these areas where you can grab broad patents and license them to companies that will hopefully come into the market in the next few years,” he said. “The broader the patent, the better the patent.”
One issue that has acutely affected the world of cannabis patents is a lack of available prior art, which has allowed some patent applicants to obtain patent claims that would otherwise be anticipated or obvious over the prior art. This is due in part to marijuana’s legal status discouraging publication of cannabis-related innovations by inventors who don’t want to attract the attention of federal law enforcement. Brubaker acknowledged that prior art issues have affected the industry. “A patent examiner only has so much time to search for prior art on each patent application,” he said. “They’ll definitely do a search of patent and patent application databases, and may even do a quick Google search, but it’s possible in the cannabis field that they may not find something that everyone else knows is pretty common in the art. If the examiner doesn’t find it, then there’s no rejection based on the prior art.”
Recently Granted Cannabis Patents
Oral Care Composition Comprising Cannabinoids
U.S. Patent No. 10172786, issued on January 8 of this year and assigned to AXIM Biotechnologies, claims a cannabinoid toothpaste composition comprising an abrasive agent, a binder, a humectant, a fluoridating agent, a surfactant, water, a thickener, cannabidiol (CBD) present in an amount from 0.1 percent to 0.5 percent by weight, and lactoferrin present in an amount from 0.1 percent to 0.5 percent by weight. The oral care composition covered by this patent, which can also come in a mouthwash solution, makes use of CBD to promote the antibacterial properties of the composition.
U.S. Patent No. 9956174, issued in May 2018 to inventor Jeff Nordahl, claims a package comprising a plurality of frozen structures of cannabis juice purée where the structures include amounts of CBD, tetrahydrocannabinol (THC), cannabidiolic acid (CBDa) and tetrahydrocannabinolic acid (THCa) and where the purée is formed by blending leaves of a cannabis plant and the shredded leaves remain in the frozen structures of the purée. The invention, intended as a dietary supplement, provides a means for manufacturing and packaging cannabinoid products which delivers the medicinal properties of THCa and CBDa without those substances being decarboxylated through heating processes into THC and CBD.
U.S. Patent No. 9888703, issued in February 2018 and assigned to Imbue LLC, claims a coffee pod consisting essentially of carbon dioxide extracted THC oil cannabis, coffee beans and maltodextrin. The invention covers methods of creating a consumable coffee drink that consistently contains about 5 milligrams (mg) to about 50 mg of THC, the primary psychoactive component of the cannabis plant.
Single Serve Beverage Pod Containing Cannabis
U.S. Patent No. 9480647, issued in November 2016 and assigned jointly to CannTrust Inc. and Club Coffee L.P., claims the method of preparing a single-serve container configured for receipt in a single-serve brewing machine, the method involving processing cannabis by pulverizing it to a particle size of less than one millimeter (mm) and by heating it at a sufficient temperature and time period to decarboxylate cannabis, adding the processed cannabis to the single-serve container, adding an effective amount of a lipid-rich food-based extraction agent and sealing the container. This invention, which could be used with Keurig or Tassimo machines, is intended to provide the medicinal benefits of marijuana to patients who may be reluctant to smoke marijuana.
Enhanced Smokable Therapeutic Cannabis Product and Method for Making Same
U.S. Patent No. 10172897, issued on January 8, 2019, and assigned to NC3 Systems, claims a method of preparing an enhanced smokable therapeutic cannabis product by separating hash resin from plant material of a cannabis plant, pressing the hash resin to expel oil and create spent hash resin, extracting further cannabinoids from the spent hash resin using medium chain triglyceride oil, enriching the extracted oil with purified ?-myrcene and spraying the enriched oil onto dried smokable cannabis plant matter. The invention provides more of the therapeutic effects of marijuana by addressing shortcomings in varying chemical content across different strains.
Cannabis Claims Canceled
Cannabis Plant Named Mr. Grass Weedly
U.S. Patent Application No. 20190000029, filed in July 2017 and assigned to Insectergy, LLC, claims an alimentary multifunctional composition including cannabis and insects with a CBD content ranging from 0.00005 weight percent to 15 weight percent and a THC content ranging from 5 weight percent to 63 weight percent. The composition has an insect mass ratio ranging from 25 pounds to 1,500 pounds of insects per ton of composition. The invention addresses a need for a superior blend of cannabis providing improved medicinal benefits and has a high yield to meet demand at a low price.
Brubaker said that it appeared this particular patent application was experiencing a difficult time at the USPTO given the fact that claims 1 through 151 have been cancelled. “It’s very rare for a patent application to start with 152 claims,” he said. A seventh supplemental preliminary claim amendment document posted to the Public Patent Application Information Retrieval (PAIR) image file wrapper for this patent application shows that the patent applicants have cancelled claims 1 through 247 and have proposed new amended claims 248 through 279.
Brubaker noted that it was very unusual to include the brand name of the particular marijuana strain in the title of the patent application.
Since last year, when Canada legalized recreational pot in full, the nation became a kind of country-sized lab for how that new business would play out. That market could reach as much as $5.1 billion in annual sales by 2020, according to one estimate – though some predictions are higher, especially ones that include spending on accessories and growing supplies.
Still, even after all these months, and even with legalization done at a federal scale (as opposed to province by province), the cannabis payments process has hardly hit a full stride. While not as bad as the situation in the U.S., the situation demonstrates that payments don’t always keep pace with rapid social change — change that often encourages entrepreneurship. That said, payments providers are indeed working hard to fill in the gaps when it comes to the growing cannabis business, both in Canada and the U.S.
One month after Canada legalized marijuana for everyone in the country, Canadians spent C$54 million ($41 million) on the product, according to a recent report in Bloomberg. The C$54 million number is higher than the original estimate of C$43 million, illustrating the potential of the market. “Retail figures will vary as new stores continue to come online and the marketplace continues to evolve,” the report said.
Canada legalized cannabis after Prime Minister Justin Trudeau said prohibition wasn’t working and provided illicit money to gangs, while allowing for unchecked use by the country’s youth. The legalization of marijuana in Canada was a big win for the prime minister, who said he would legalize pot use when he was running for office in 2015. The idea is to take profits away from organized criminals and to regulate the production, distribution and consumption that is already available illegally.
But there are still barriers to full access and exploitation of those profits.
According to various reports and analysis, the Bank of Montreal remains the only “Big Five” financial institution in Canada to deal directly with the legal cannabis business there, including via financing of those state-sanctioned operations. That had led to the bank attracting business from cannabis producers seeking bank accounts — news that underscores what happens when a major payment and financial services provider gets in early. Smaller financial firms participated in the action as well.
The U.S., at least via certain federal agencies, has taken a dim view of legal recreational pot use in Canada, a view that has led to warnings and hassles for Canadian citizens entering the country. As well, Canadian financial institutions still worry that dealing with cannabis operations — even though they are legal — could lead to anti-money laundering compliance issues, as is the case in the U.S.
Those worries, in fact, have bled down into a warning regarding consumer payments — a warning that won’t do much to encourage the further use of digital payment methods and plastic cards for legal cannabis purchases in Canada.
In late 2018, Daniel Therrien, Canada’s federal privacy commissioner — a job that spans larger issues of digital privacy, among other topics — warned consumers in the country to use cash, not cards, to buy their recreational pot. “Cannabis is illegal in most jurisdictions outside of Canada. The personal information of cannabis users is therefore very sensitive,” Therrien wrote. “Some countries may deny entry to individuals if they know they have purchased cannabis, even lawfully.”
Oddly enough, that may be hard for some cannabis buyers, as a recent report noted.
“If you live in Ontario, the only means of buying legal weed is through the Ontario Cannabis Store — an online sales platform that only accepts credit card payments,” according to Civilized. “The personal information of 4,500 OCS customers had already been breached, though there hasn’t appeared to be anyone blocked from travel because of this.”
The report adds that when it comes to legal medical marijuana in Canada, “the only way for patients to legally buy medical marijuana is online.”
In the U.S., meanwhile, the situation is different – though with roughly similar results of making financial institutions and card networks reluctant to serve the industry.
U.S. federal law still classifies marijuana as an illegal substance, producing a conflict with states that have legalized pot in various ways. But some financial institutions, backed by certain law enforcement officials and lawmakers, are pushing a Congressional bill that would allow “safe harbor” to banks and credit unions that serve the legal cannabis industry (including vendors that serve legal cannabis operations).
It appears likely that when it comes to cannabis, financial institutions and payment services, progress in Canada will stay a step ahead of what happens in the U.S. But that doesn’t mean things will develop quickly in Canada. Even in the early 21st-century digital era, it can take a long time for the realities of payment and commerce to catch up with social change.
To read more visit: https://www.pymnts.com/aml/2019/canada-cannabis-payments-regulations/
The entire cannabis industry has been spreading like wildfire lately, but a particular niche seems primed to becoming the next big thing: hemp.
Following the passage of the U.S. Farm Bill, hemp and all hemp-based products are now legal (not including CBD edibles, currently under attack, as we just saw in New York), which makes for a thriving industry. There are 2 primary differences between hemp and cannabis. Number one, hemp won’t get you high but it has many of the same benefits as cannabis since it often has other cannabinoids and especially high levels of CBD. Number two, hemp has a history of industrial uses such as producing paper, plastic, food, clothing, insulation, and numerous other products.
So what can we expect in terms of growth when it comes to the hemp? Well, we’re looking at an industry expected to double in market size within two years. According to a recent report from New Frontier Data titled The Global State of Hemp, worldwide hemp sales equaled $3.7 billion in 2018 and are estimated to be almost double at $5.7 billion by 2020.
As of now, China is leading the profits game with nearly $1.2 billion in hemp sales. The United States came in second with an even $1 billion, followed by all of Europe at $980 million, and Central and South America rounded out the end of the list with a combined total of $220 million.
As the market grows, it’s expected that the United State may move in to the top slot, depending on how any upcoming regulatory changes are handled. New Frontier Data predicts that U.S. hemp sales will increase to $2.6 billion by 2020. About half of this revenue will come from the sale of hemp-derived CBD products.
If you’ve been looking to invest in the industry, now would be the perfect time, as long as you have done your homework… Check back for more updates on this developing market and make sure to subscribe to our Weekly Newsletter for all the latest news and information about the cannabis and hemp industries.
To read more visit: https://www.cbdtesters.co/2019/02/19/hemp-industry-growth/
Canada often serves as America’s colder, nicer, saner foil, and its handling of marijuana policy exemplifies its more pragmatic side. While federal, state and even local governments in the United States hurtle in different directions on cannabis, our northern neighbor dispensed with much of the confusion by legalizing the drug at the national level last year.
Two Bay Area business deals this week presaged the literal dividends of that decision. Canadian cannabis concerns acquired the Oakland mega-dispensary Harborside as well as three San Francisco dispensaries owned by Apothecarium. The former transaction, valued at $153 million, is a reverse takeover in which a smaller Toronto company is acquiring its larger Oakland counterpart, which also has a San Jose dispensary and will retain most of the ownership of the resulting firm. Another Toronto company is buying Apothecarium for $118 million in cash and stock.
Both of the purchasers are publicly traded on the Canadian Securities Exchange, which listed about 50 American cannabis companies last year. That will give the firms valuable access to capital markets and dramatically increase their ability to grow in more than the cultivating sense.
That is in sharp contrast to the companies’ situation in the United States, where then-Attorney General Jeff Sessions was still mulling a war-on-drugs-style crackdown on marijuana even as Canada was moving to legalize it. Federal authorities were moving to shut down Harborside until 2016.
Cannabis remains illegal for medical or recreational purposes at the federal level and in 17 states. The nation’s law enforcement agencies are still making more than 600,000 arrests a year on marijuana charges, most of them for possession, a figure that has been rising in recent years despite increasing legalization. Such arrests disproportionately affect minorities.
The costs and harm of continuing criminalization are in addition to the economic benefits forgone in states that have changed course. Cannabis’ legal limbo cuts it off from regular banking and financial services, let alone the stock market.
Former California Treasurer John Chiang at one point advocated a fleet of armored cars to help the state collect marijuana taxes paid with huge quantities of cash. His successor, Fiona Ma, proposed special state-chartered banks to provide services to marijuana businesses; this week, she was among those urging the new Congress, in its first hearing on marijuana, to take steps to give the industry access to conventional financial services.
Both California and Canada have yet to sort out the many complications of ending marijuana prohibition, from ensuring that it doesn’t encourage more use among minors to making the legitimate industry more attractive than the black market.
The difference is in the minimally coherent national policy that remains sorely lacking in the United States.
In contrast to his former attorney general, President Trump has occasionally gestured toward a more forward-looking marijuana policy.
Given his fixation on trade with our northern neighbor, perhaps Canada’s emerging advantage in the industry will push the administration in the right direction.
The first bulk batch of medical cannabis imported into the U.K. since it was legalized for prescription last year has arrived from the Netherlands.
The shipment, exported by the Office of Medical Cannabis, will be sent directly to pharmacies to provide to patients under prescription for treating conditions including chronic pain and multiple sclerosis, according to a statement from British startup Grow Biotech. The company said it worked with investor European Cannabis Holdings and pharmaceutical importer IPS Specials to facilitate the delivery.
The U.K.’s Home Office gave specialist doctors the option to prescribe medical marijuana in November. They will be able to offer the drug on a case-by-case basis when other licensed products cannot meet the patients’ needs. That followed a shift in public attitudes toward cannabis-based medicines after two British children with epilepsy were prevented from bringing medication back into the country, sparking an outcry.
The regulatory outlook is also shifting in Europe. The European Parliament voted in favor of a non-binding resolution on Wednesday which will seek to encourage European Union countries to increase access to medical marijuana.
The World Health Organization has taken a similar stance, calling on Feb. 1 for marijuana and cannabis resin to be removed from Schedule IV of the 1961 Single Convention on Narcotic Drugs, the most restrictive categorization. Bloomberg Intelligence analyst Gopal Srinivasan said the move by WHO would provide countries with “additional political cover” to reconsider their stances on cannabis.
Europe’s publicly traded cannabis industry remains very small but the industry is proving more lucrative than initially expected. Grow Biotech said in a fundraising announcement in July last year it intends to join the tiny group of marijuana providers on the stock market in the fourth quarter of 2019.
The number of listings in Europe pales in comparison to the boom in Canadian pot stocks born out of the legalization of recreational marijuana. Those names are also looking to a newly liberalized U.K. for expansion, including Canopy Growth Corp., which has partnered with a British cannabis therapies researcher with the aim of introducing products in early 2019. Aurora Cannabis Inc., another of the Canadian pot giants, made its first commercial export of cannabis oil to the U.K. earlier this month. That ingredient is used in wellness products like cannabidiol, or CBD oils which are now sold widely in U.K. pharmacies.
For Aurora too, regulation is key. “One of the things that we’re doing in Europe is making a very clear argument that Europe should move forward in harmonization country to country, so as not to disturb the common market,” said Cam Battley, Aurora’s chief corporate officer said on the company’s earnings call this week. If you want to “operate as a single market, you have to have a harmonized set of regulations.”
The application process for a micro-cultivation licence is pretty dense; think between 100 and 225 pages per application
Tucked into the Cannabis Act—the federal legalization that allows for the legal sale of recreational cannabis in Canada—one will find the rules governing how to operate a micro-cultivation facility.
Like the large licenced producers (LPs), there are licensing fees and security requirements; unlike those LPs, micro-cultivators are subject to a designated square footage and output.
First up, it’s important to note that a micro-cultivator can have a facility of 200 sq. m, or 2,150 sq. ft., and with that space, it’s very challenging to get to even 600 kg of dried cannabis per year. (Micro-cultivators are not subject to a 600 kg limit, but processors are.)
“A micro-cultivator approved by Health Canada can only grow cannabis. The only options for selling are another processor, an LP or a researcher,” explains Tom Doran, founder and CEO of Pattern Micro Cultivation, a growing collective of micro-cultivators that also acts as a consultancy for those looking to get into the micro-cultivation business. Micro-cultivators “cannot sell to a provincial or territorial outlet. They can grow cannabis, but cannot make oil with a cultivation-only permit,” Doran points out.
To get a micro-cultivation operation off the ground, a person needs $2,500 for a micro-cultivation licence (this covers growing cannabis plants for distribution) and another $2,500 for micro-processing (this covers anything related to processing and packaging the flower), both through Health Canada. Some consultants stress that if a person wants one of these licences, it’s likely best just to get both.
“[Cultivating], that’s one licence in itself,” notes Edward Collins, vice-president of global sales and marketing at Cannabis Compliance Inc., a Mississauga, Ont.-based firm that specializes in helping cannabis businesses navigate all areas of the industry. “There’s a processor’s licence, that most don’t need if they’re working with a larger LP. There’s a sales licence, and there’s a [nursery licence]. That’s really for genetics more than anything else,” Collins says.
A sales licence will also run a grower approximately $5,000, he says, and a nursery licence will set him or her back another $2,500.
At this point, it’s also worth noting that mirco-cultivators have to go through their municipality to ensure they can operate a cannabis grow facility legally in the area they want to call home, which could incur administrative fees and more depending on the municipality. The specific rules all depend on the municipality in question.
Now that initial fees are out of the way, each micro-cultivator will need to pay $1,654 per person in security fees, which covers directors, shareholders (above a certain percentage) and those holding a meaningful position (master growers, for example) for the site to have the designated clearance to get growing.
Add to this tally, notes Health Canada, that the minimum fee is either $23,000 or $2,500, depending on the types of licences a person is seeking. And once things get under way, there are regulatory fees after revenue starts rolling in, namely one percent for cannabis revenue of $1 million or less and 2.3 percent on any cannabis revenue in excess of $1 million.
These fees might not be too daunting, yet. However, the application process for a micro-cultivation licence is pretty dense (think between 100 and 225 pages per application, and it can take about eight weeks to complete, Doran says). So, enlisting some outside help could certainly be beneficial, but that assistance doesn’t come for free.
“From the consulting standpoint, a licence to process is about $100,000,” Collins says of what his firm charges. “If you add cultivation to that, it totals out to be about $115,000—somewhere in that price range.”
“There are licensing firms out there,” Doran says. “The one that I use, one of my foundational partners, he charges about $37,000 to complete a micro-cultivation application for Health Canada. If you do processing, it’s about $67,000 for both a micro-cultivation and a micro-processing permit to Health Canada,” he adds.
Money will also become a factor when looking for land to cultivate—a piece of property large enough to play host can cost a prospective grower anywhere from $50,000 to $500,000, depending on the desired location—as well as looking at whether to build a facility from scratch or retrofit an existing structure to fit within the licence’s rules and regulations.
“I think a barrier to entry in micro-cultivation is the cost, the licensing and the construction of the facility,” Doran warns. He also sees marketing as a potential hardship, given that regulations are strict when it comes to marketing cannabis, and LPs will simply have decidedly larger marketing dollars to play with.
“If they dig pretty deep on some of that, there could be some nervousness about releasing that kind of information. Background checks and the security checks might make people nervous. But I will tell you that Health Canada has been fairly lenient, and [his view is] they do want the grey market people to participate in the regulated industry.”
The plus side
There are LPs that are actively looking for micro-cultivators to help supplement or buoy their existing offerings. That being the case, linking up with one of the bigger cannabis brands has its benefits, especially if a would-be grower is looking for a leg-up when getting started.
“Just like with craft alcohol, we want independent operators to be able to create their own niche and their own branding and to compete,” Doran says. “The independent cultivators in the craft cannabis that’s produced will simply be better than what’s produced by the large LPs, who’ll have more output, but it won’t be as good,” he argues.
Doran also mentions that some LPs, such as B.C.-based Sundial Growers, are adding smaller grow rooms to help produce better flower for their proprietary brand, as well as reporting that his understanding is there are only about 30 to 35 micro-cultivation licence applications pending with Health Canada, so now might be the time to get those papers in order.
Although micro-cultivators may be seen as the little guy in this burgeoning industry, it’s clear there are benefits—monetary and beyond—to starting a smaller, legit cannabis growing company.
Cannabis sativa has managed to flip the table of fate in its favor. With legalization, the use of marijuana is also slowly spreading into various industries. Today like groceries and clothing you can easily order weed online and enjoy its benefits from the comfort of your home. The medicinal value of cannabis has triggered interest in the food industry that is looking to introduce this amazing ingredient into various edibles making the intake easier. Gone are those days when all you could think about was hash brownies when you talked about cannabis-infused edibles.
Here are the top 5 food trends that are cannabis-based that will leave you completely in awe.
- Cannabis infused drink: The magic of CBD which is an active component present in cannabis is slowly unraveling and this has created particular interest in creating outstanding drink recipes from this ingredient. It is non-psychoactive, flavorful and most of all is loaded with health benefits making it an ideal component to introduce to a healthy drink. Vybes has reached shelves in various states across the United state wherein the product combines CBD with various flavors to create delicious drinks to relish. These drinks have a calming effect on the body and can help improve overall health. Cannabis infused health drink mix is also available with loaded proteins which can be combined with steroids to achieve great results from workouts.
2. Cannabis cocktails: The next time you go to a bar don’t forget to ask your bartender to serve their favorite and special on menu Cannabis cocktail. While combining cannabis and alcohol may not be a good idea, in general, the extracted CBD which is used as an ingredient in these cocktails pairs amazingly well with the drink. In fact, it also seems to negate the negative effects of consuming CBD with alcohol and making it a rather fun experience. A cocktail Stiney Negroni joined the menu at High Vibes which is loaded with orange bittersweet vermouth, gin and the Stoney ingredient, CBD. You can also try a Sour T-iesel and various other experimental cannabis cocktails that are slowly getting added to bar menus.
3. Cannabis ice cream: If you are bored of trying all the flavors lined up at the ice cream parlor then cannabis ice creams might be your thing. A trend that exists at the Green Market YYC in Canada, this store added a twist to their regular ice creams. Apart from ice cream the store also has gummies and macaroons that are infused with marijuana. The trend is slowly setting in the region to move to more places across the country where legalization will slowly set in to expand to edibles also.
4. Cannabis glazed donut: If you could not find a reason to refuse a donut till now, this addition to the list is simply going to make it impossible. The sugar-dusted donuts that are drool worthy are now available as cannabis dusted masterpieces. Glazed & Confuzed offers a CBD infused glazed donut menu which matches the enticing sweetness of donuts with the earthy and stony flavors from CBD. The donut is topped with a candied hemp leaf and can be a great way to take you off the edge. Strains such as white rhino help relax the body and mind while being presented in an outstanding base such as a donut.
5. Cannabis infused chocolates: Like pot cookies and Marijuana gummies the mixture of sugar, chocolate, and CBD is an ecstatic combination that makes an amazing snack. Kica and Defonce are the prominent brands offering these flavorsome chocolate bars that effortlessly let you enjoy the health benefits of marijuana mixed with an amazing ingredient such as chocolate.
Cannabis-based food trends are slowly catching up in the market. In fact, Cannabis theme parties are becoming a rage these days. Big players from the food industry are also looking at possible CBD based food infusions to introduce an exciting range of products for the customers. With the legalization of recreational marijuana plants, these food trends are expected to expand to more foods which will make the benefits of marijuana much more delicious and amazing.
Jessica has been closely studying the cannabis industry trends from quite some time. Intrigued by the booming growth of this sector, she takes interest in penning down her views providing quality insight on current marijuana trends, particularly medical cannabis.