Have Cannabis Growing Expertise, Seek ‘Golden Ticket’

Have Cannabis Growing Expertise, Seek ‘Golden Ticket’

Pardon the “Breaking Bad” analogy, but of the two complementary factions destined to meet in the so-called “green rush” to cannabis, horticultural growers might be said to be Walter White and the established marijuana industry Jessie Pinkman — the former with technical knowledge but little market experience, the latter with market experience but little technical knowledge.

The tradeshow floor at the 2015 Cannabis Business Summit & Expo in Denver, Colo., would have felt like a familiar parallel universe to most greenhouse growers: structures, lighting, climate control, irrigation, etc. And indeed many cannabis “cultivators” now emerging from the underground have designs on a greenhouse environment: It affords the controllability and optimal growing conditions that the open fields and warehouses to which they’re accustomed simply don’t have.

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Up for grabs for both factions is a market for medical and “adult use” marijuana projected to quadruple to nearly $11 billion by 2019. But for traditional growers smacking their lips at the prospect of simply outgrowing the competition, the current byzantine legal climate might give pause.

National Laws Still Hamper

Cannabis remains illegal at the federal level, meaning it’s a cash-only business with no access to credit from the banking system. In fact, the closer entities are to federal funding (think University/Extension), the more unlikely — illegal, really — it is for them to work with cannabis growers.

Some in the cannabis industry are hopeful national legalization could be as near as 2020. In fact, a pro-Cannabis coalition is building in Congress among odd political bedfellows, including Libertarian Rand Paul (KY), Republican Dana Rohrabacher (CA) and Democrat Kristin Gillibrand (NY). Federal decriminalization is only 16 votes away, and this in a conservative Republican Congress, said Aaron Smith, executive director of the National Cannabis Industry Association (NCIA).

What direction a federal system would take is totally up in the air. Would it look more like Colorado’s, in which the number of cultivation licenses has yet to be capped? Or would it be more like a system proposed in Ohio, which would license only 10 cultivators (and thereby open it up to charges of establishing a cabal)?

Many horticultural growers might start cultivating cannabis tomorrow if they could secure a license, the equivalent of a “golden ticket.” But these are hard to come by, and the number and criteria vary greatly by state, according to Taylor West, NCIA deputy director. In some states, a license is predicated on cultivating experience even if it was gained in another state, while others have a residency requirement. Some states have merit systems, while others run a lottery among growers with a base level of expertise and experience.

It’s all very hard to pin down.

“Cannabis is an open market that’s not growing like a normal market,” West said.

The Green Tide Is Turning

Make no mistake, the national mood is swinging in favor of Cannabis. Adult use is likely to be passed in California in 2016, and medical use in Florida.

“Some very big states are coming online,” West said. “This creates a sense of inevitability for the country, at least for the states that have the potential to go in the direction of cannabis legalization.”

The rules of the cannabis game may remain inscrutable right now, but growers who have not yet won a golden ticket might do well to keep their place in the queue.