The post 5 Problems Facing California’s New Cannabis Economy appeared first on High Times.

The harvest is in and the first day of legal commercial sales of adult-use marijuana has passed. But the California cannabis industry is not saved. There are problems facing California’s new cannabis economy

Uncertainty and speculation take the place of facts and figures. Many of the same problems that plagued us way back in December, when everything was “still just medical,” harry us still. And they demand answers.

Lost in nearly all of the heady coverage from Jan. 1, when crowds lined up in the darkness a few hours into the New Year to buy a taxed-and-(somewhat)-regulated gram of legal marijuana, are the unfinished business and unresolved questions looming in the shadows. They’re too big to ignore and could make the marijuana industry too unwieldy, problematic, or expensive to succeed.

In terms of problems facing California’s new cannabis economy, here’s what’s keeping us down:

Legal Marijuana Is Really Expensive—Too Expensive?

It didn’t take long after the first legal sales on Monday morning for the joy and novelty to clear. And once those vapors dissipated, the sticker shock to set in. 

The first gram sold at Oakland’s Harborside—sold to Harborside’s lawyer—cost $20 and change. At Berkeley Patients Group, once state and local taxes factored in, top-shelf eighths were $75 out the door. In cannabis-growing country in Sonoma County, the asking price for an eighth of Sapphire Kush was $70. Before taxes.

Admittedly, this is for the best (and, ergo, priciest) cannabis on the market. But these price points are rightfully stoking fears of a black market lingering around for quite a while after legalization. And, quite possibly, becoming a permanent fixture, unless prices can become competitive.

Once you add in all the various levies, there’s an effective rate of around 40 percent. California’s pot taxes may be the highest in the nation. Marijuana sellers know they’re not the only game in town even if they’re the only licensed operation. And they are absolutely aware that consumers won’t cheerfully fork over 40 percent more money for the same product forever.

As it always does, time will tell if these open and serious concerns prove prophetic warnings, but consumers don’t typically react well to sudden, sharp increases in prices (but, just as often, markets don’t care). And high prices is just one of the problems facing California’s new cannabis economy.

Legal Marijuana Is Not Everywhere

Far from it—and to use some major cities as a case study, legal marijuana may be smaller in footprint than medical cannabis.

In order for the open sale of cannabis to happen in California, local lawmakers have to decide they want it. As of Jan. 3, only a select few major cities and cannabis-friendly counties have done so.

The first adult-use sale in the city of Los Angeles is still a month or more away. Businesses wishing to join the new pot economy could start applying on Wednesday, and processing their paperwork could take weeks. Using LA as a further case study, only 390 out of more than 1,400 existing businesses are expected to qualify for state licenses. (Every retailer open on Jan. 1 was in business on Dec. 31 as a medical-marijuana dispensary.) It will take a long time and much legislating for California to be truly inundated with legal weed.

Even When It Is, There’s Nowhere To Smoke It

5 Problems Facing California’s New Cannabis Economy

Ninety minutes after they’d made history on Monday morning by purchasing the first prerolls at Berkeley Patients Group (Jack Herer, named after the late legendary legalization activists), legalization was still a half-intellectual, half-commercial exercise for Mikki Norris and Chris Conrad. They hadn’t smoked any because there was nowhere to do so. They were still on dispensary property, where consumption is not allowed—and walking onto the sidewalk would put them on public property, where consumption is also not allowed.

The question of where to allow cannabis users to congregate and consume seems like a simple one. Yet it has vexed policymakers in Colorado for nearly five years. Prop. 64 does allow for cities to license consumption lounges, yet most have not. They should—and in the meantime, users should take heed and remember that lighting up in public could earn them the attention of authorities and a citation.

Marijuana is legal, yet prohibition-era problems persist.

One of the problems facing California’s new cannabis economy is that everything that was wrong and broken and unfair in December is still thus. Cannabis outfits still can’t use banks like normal businesses, forcing customers to use cash or their debit cards only. Cannabis businesses still can’t claim expenses on their taxes. Employers can still fire marijuana users and deny them jobs solely for using cannabis under state and federal drug-free workplace laws. Stigma around cannabis use remains as strong as ever. Out in Sebastopol, California on Monday—a “more progressive than thou” stronghold in an already more-liberal-than-most state—several buyers in line at SPARC declined to give names or give consent to photographers who wanted to snag a shot. 

All this is very much the beginning stages of a new era, the nature of which is very much up to question, but it’s clear that the strictures of prohibition are still with us, and will take a while yet to escape.

More Problems Facing California’s New Cannabis Economy

Ready for a quick thought exercise? Tell us: What do you know about California’s regulated cannabis marketplace? The only right answer is “between nothing and very little,” since that’s all anyone really knows. The unknown is one of the more insidious problems facing California’s new cannabis economy.

Will the millions of Californians who’ve managed to live in a state that produces 13.5 million pounds of marijuana annually without ever touching a gram themselves become daily consumers, now that cannabis is legal? We don’t know. Nobody knows. The cannabis industry certainly hopes so—that’s what they’re telling their investors—but nobody really knows.

We still have no idea what kind of products a regulated adult-use marketplace will produce. After all, everything on the shelves on Jan. 1 was there on Dec. 31, when everything was “still medical.” Nothing’s been tested for contaminants yet, put in the track-and-trace system, or ferried around the state by licensed distributors. Dispensaries can still sell stock that hasn’t gone through testing and edibles that exceed the 100 milligrams-of-THC threshold until July 1.

In other words, we’re still in a netherworld, an amalgam of what we’ve known under medical marijuana and what we may experience in the future. 

There’s plenty of potential and reason to celebrate. Things aren’t getting worse in this area, which is more than can be said for almost everything else. But a bright and verdant future is far from guaranteed considering these problems facing California’s new cannabis economy.

The post 5 Problems Facing California’s New Cannabis Economy appeared first on High Times.

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1. What is CBD? What is CBD Oil?

Cannabidiol (CBD) is a naturally occurring constituent of industrial hemp/cannabis. Its formula is C21H30O2 and it has a molecular mass of 314.4636. It is the most abundant non-psychoactive cannabinoid found in cannabis, and is being scientifically investigated for various reasons.

CBD oil is a cannabis oil (whether derived from marijuana or industrial hemp, as the word cannabis is the latin genus name for both) that has significant amounts of cannabidiol (CBD) contained within it. Our CBD products and extracts are derived from industrial hemp, so they could be considered CBD-rich hemp oil, hemp derived CBD oil, CBD-rich cannabis oil, or plainly “hemp extracts” since they typically contain much more than just CBD. Again, cannabis doesn’t mean marijuana, but is the genus name, and general umbrella term which all forms of marijuana and hemp fall under. The form of cannabis we use for our CBD and hemp extracts is industrial hemp; we do not sell marijuana.

2. If a hemp extract is 40% cannabinoids, what’s the other 60%? What’s in your hemp extracts besides the naturally occurring cannabinoids?

Our Kentucky hemp extracts contain over 80 different phyto-cannabinoids such as cannabidiol (CBD), CBC, CBG, CBN, etc.. In addition to the cannabinoids naturally present in our agricultural hemp extracts, there are also many other types of natural molecules and phyto-chemical compounds such as amino acids, carbohydrates, vitamins (including B1, B2, B6, D), fatty acids (including omega 3 & 6), trace minerals (including iron, zinc, calcium, magnesium, potassium), beta-carotene, chlorophyll, flavanoids, ketones, nitrogenous compounds, alkanes, glycosides, pigments, water, and terpenes. The most common terpenes in our hemp extracts are Myrcene, Beta-caryophyllene, Terpinolene, Linalool, alpha-Pinene, beta-Pinene, Nerolidol og Phytol, trans-alpha-Bergamotene, Limonene/ beta-Phellandrene (Co-elution), and alpha-Humulene.

3. What’s the difference between Hemp and Marijuana?

Scientifically, industrial Hemp and Marijuana are the same plant, with a genus and species name of Cannabis Sativa. They have a drastically different genetic profile though. Industrial Hemp is always a strain of Cannabis sativa, while marijuana can be Cannabis sativa, Cannabis indica, or Cannabis ruderalis. The major difference is how industrial hemp has been bred compared to a marijuana form of Cannabis sativa. organic hemp seedsTypically speaking, industrial hemp is very fibrous, with long strong stalks, and barely has any flowering buds, while a marijuana strain of Cannabis sativa will be smaller, bushier, and full of flowering buds. However, newer industrial hemp varieties in the USA are being bred to have more flowers and higher yields of cannabinoids and terpenes, such as our Kentucky hemp we’re now using!

99% of the time marijuana has a high amount of THC and only a very low amount of CBD. Hemp, on the other hand, naturally has a very high amount of CBD in most instances, and only a trace amount of THC. Fortunately, the cannabinoid profile of hemp is ideal for people looking for benefits from cannabis without the ‘high.’ Hemp is used for making herbal supplements, food, fiber, rope, paper, bricks, oil, natural plastic, and so much more, whereas marijuana is usually used just recreationally, spiritually, and medicinally. The term cannabis oil can refer to either a marijuana or hemp derived oil, since marijuana and hemp are two different forms of cannabis.

In the USA the legal definition of “industrial hemp,” per Section 7606 of the Agricultural Appropriations Act of 2014, is “INDUSTRIAL HEMP — The term ‘‘industrial hemp’’ means the plant Cannabis sativa L. and any part of such plant, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than 0.3 percent on a dry weight basis.”

4. Are hemp derived cannabinoids such as CBD as good as CBD from marijuana?

The short answer is yes. CBD is CBD, whether from marijuana or hemp. Most marijuana has a very low non-psychoactive cannabinoid profile (like CBD, CBC, CBG), so most of the time hemp would be much more preferable for anything besides THC. Marijuana is usually very high in THC (gives people the high) but usually very low in other non-psychoactive cannabinoids.

Nowadays in the USA, many farmers are growing industrial hemp flowers that are just as beautiful, odor-producing, and terpene rich as the best marijuana strains, such as our partnered farmers in Kentucky.

5. Why don’t you source your Hemp and CBD from within Colorado?

colorado growing operationWe feel that the hemp program in Kentucky is more well suited for our company in regards to growing hemp, and that because it’s 100% compliant with Section 7606 of the 2014 Farm Bill (and the 2016 Agricultural Appropriations Act), procuring it from there is perfectly legal at the federal level. Kentucky’s ecology is perfect for hemp just as it is for tobacco. The growing season is longer than in Colorado, and the soil is richer, so the quality of the hemp and the yields are better.

6. What’s the percentage of cannabinoids and CBD in your product?

Our raw extracts have varying percentages of cannabinoid and cannabidiol (CBD) content, the range being 10%-99%. Each product has a unique formulation and uses varying ratios of our extract types. Our CBD Isolate is over 99% pure CBD.

7. What is the best method of use?

For our dietary supplements we can only recommend them for internal consumption. Our CBD isolate is for research purposes only. If you don’t like the flavor of the oil supplements, you can mix with something sweet like apple sauce or honey to cut through the flavor.

8. What’s the ideal serving size for me, and how often should I take it?

There is no easy answer to this. Our starting recommended serving size is 15 drops but we generally recommend experimenting to see what feels best to you. Some prefer 5 drops, some prefer over 50 drops per day.

9. What is the safety of your hemp extracts? Are there negative side effects?

Hemp is considered by many to be generally safe. We’ve never seen or heard of any significant or negative CBD Oil Extractside effects in our years in the industry. That said, we can’t rule them out. Please consult with your physician before using any dietary supplement including Hemp extract supplements.

10. Which of your CBD and hemp products should I get?

As a company who sells various dietary and food supplements, we can’t suggest any of our products for the prevention, treatment or cure of any disease or ailment.

When considering our different dietary hemp products, know that they all come in two strengths. Our Original Hemp blends (Classic Hemp Blend, Hemp Complete, Brainpower oil, & Signature Blend) all have 250+mg of cannabinoids per fluid ounce, and our concentrated blends have 1,500+mg per fluid ounce, six times the potency of our traditional oils. We’ve found that sometimes less is more, but nevertheless, some people like to take very large serving sizes of our hemp extracts.

The main difference between the four Original Blends is the additional herbal ingredients besides hemp. We suggest you research the separate components of each blend to determine which product may be most appealing to add to your dietary regimen. If you know it’s solely the hemp extract that you are looking for, with no additional ingredients, then Classic Hemp Blend or Classic Hemp 6x is what you’re looking for.

For dabbing and vaporizing or for research you can try our CBD Isolate.


11. Why do people use Hemp Extracts and CBD? What are the benefits and uses of CBD?

In accordance with federal regulations we cannot make health claims regarding our dietary supplement products. We can only recommend our products for general wellness.

12. Is a standard hemp seed oil the same as a high-CBD hemp extract?

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Absolutely not. Standard hemp oil, which can be found very cheaply at a grocery store, is a much different product than our CO2 hemp extracts (not from seed). Standard hemp oil is produced by cold pressing the seeds, whereas our hemp extract is a supercritical CO2 extraction of the hemp plant itself, not the seeds. Hemp seed oil is considered to be a great nutritive food, but it doesn’t have the naturally occurring terpenes, cannabinoids and other components that our extracts do have.

13. Do I need to move to Colorado to get your Hemp Extracts and CBD? Where do you ship?

No. We actually source our hemp from Kentucky, as it’s legal to ship across state lines. Many people are under the impression that the only way to acquire hemp extracts and CBD for themselves or a loved one is to move to Colorado or another cannabis-friendly state. Many major news outlets are misinformed and are unfortunately spreading the idea that you can only get CBD oil in the states where medical marijuana has been legalized. This is simply not the case though. Because our extracts comes from hemp instead of marijuana, we can and do ship to all fifty states, and no medical marijuana card is needed. There are some exceptions, like with Indiana, Missouri and South Dakota we can’t sell our concentrated products due to state legislation.

We also ship to Japan, Australia, the EU, Switzerland, and Brazil. For all EU orders contact our exclusive distributor thereCannawell.

14. Is your Hemp Extract Oil similar to Rick Simpson Hemp Oil?

Not quite. Ours are from hemp and RSHO is usually using marijuana, a different form of cannabis than industrial hemp. Our industrial hemp extracts are more standardized and will usually have a much higher content of non-psychoactive cannabinoids like CBD than one produced through the Rick Simpson method. And oils produced through his method will usually have a much higher THC content, as it’s typically marijuana that is used for RSHO.†

Generally speaking, most marijuana producers and sellers (especially on the black market) don’t test for contaminants (metals, pesticides, bacteria, etc.). Rick Simpson Hemp Oil is actually more a method of extraction than it is a specific product. People use the Rick Simpson method with hundreds of different strains of marijuana, so the THC, CBD and other cannabinoid content of the final oil is always varying greatly, depending on the cannabis the consumers are acquiring. Usually what’s used for Rick Simpson oil is a strain with an inferior CBD content (and high THC), because that’s what the vast amount of marijuana is nowadays.

15. Where do you source your hemp and CBD from?

We have partners in Kentucky who grew a dedicated plot for us this year (2016) which is being used in our products now. mjna message boardWe also currently source from Europe but we’ll be changing that soon.

16. What kind of testing/analysis is performed on your products?

We have an industry leading quality control system, and we have third party laboratories analyze all of our hemp extracts and our final products for cannabinoid potency, heavy metals, bacterial and microbial life, mycotoxins (fungus), and pesticides.

17. What is CO2 extraction? What’s the difference between subcritical and supercritical CO2 extractions?

CO2 extraction is an extraction process that uses pressurized carbon dioxide to extract phyto-chemicals (such as CBD, CBG, or terpenes, flavonoids, etc.) from a plant. CO2 at certain temperatures and pressures acts like a solvent, without the dangers of actually being one. It is the most expensive extraction method, and is widely considered the most effective and safest plant extraction method in the world.

Many hemp and CBD companies boast about their supercritical CO2 extractions, but that’s actually only one (and perhaps an inferior) method of using a CO2 extraction machine. There are also subcritical CO2 extractions, and ‘mid-critical’, a general range between subcritical and supercritical. Subcritical (low temp, low pressure) CO2 extractions take more time and produce smaller yields than super-critical, but they retain the essential oils, terpenes, and other sensitive chemicals within the plant. Supercritical, on the other hand, is a high pressure and high temperature process that damages most terpenes and heat sensitive chemicals, but can extract much larger molecules such as lipids (omega 3 and 6), chlorophyll, and waxes. A truly full-spectrum CO2 extract includes first performing a subcritical extraction, separating the extracted oil, and then extracting the same plant material using supercritical pressure, and then homogenizing both oil extracts into one. In the essential oil industry, an extract made using this specific process is referred to as a CO2 Total.

18. What is the endocannabinoid system (ECS)?

“The endocannabinoid system (ECS) is a group of endogenous cannabinoid receptors located in the mammalian brain and throughout the central and peripheral nervous systems, consisting of neuromodulatory lipids and their receptors.” Wikipedia

There are two main types of receptors in the ECS, CB1 and CB2. CB1 receptors are primarily located in the central nervous system and brains of mammals, and CB2 are generally found in the peripheral nervous system. There are two main cannabinoids mammals produce- 2AG and Anandamide (named after the Sanskrit term “ananda” which translates to “peace”).

For hundreds of millions of years every vertebrate on Earth has been equipped with this ECS, a crucial system in the body, and it has been known about in the scientific and medical communities since the 1980’s. However, it’s still not taught about in most medical schools.