Cannabis News

Pacific Northwest heat waves have been challenging growers—and their plants—since June. What do these extreme heat waves mean for hemp crop harvest this fall?

Gordon Jones is an assistant professor of general agriculture based at the Southern Oregon Research and Extension Center for Oregon State University.  Jones says well established hemp plants, transplanted in good conditions with proper root growth, can withstand a fair amount of heat stress—as long as they have access to water. 

But with extreme heat come other obstacles like reduced access to water, wildfire smoke and declining worker morale.

“On some grand level, the smoke, the heat, and the drought are connected, and we could probably have a climate change discussion at the macro scale,” says Jones. These challenges make growing hemp in extreme heat a game of survival. However, there are steps farmers can take early on to prevent heat stress and still have a successful harvest.

What is an ‘Extreme Heat Wave’?

The World Meteorological Organization states that a heat wave is when the daily maximum temperature exceeds the average maximum temperature by 9 degrees Fahrenheit for more than five consecutive days. From June 24 to June 29, Pacific Northwesterners experienced a 1-in-1,000-year heat event when temperatures peaked at 116 degrees.

In extreme heat conditions, hemp leaves droop and fold up in a protective measure. If the stress is not mediated, they will yellow and become crisp. Once a plant is matured, there’s not a lot of changes growers can make, warns Cedar Grey, founder of Siskiyou Sungrown, a CBD wellness product brand in Southern Oregon.

For hemp farmers, high temperatures aren’t the only threat to crops and farmers during extreme heat events. “When it gets to that point, your plant is in trouble,” he says. “By the time the plant is mature, I don’t think there’s a lot of wholesale changes you can make other than ensuring that your irrigation is on point.”

For some hemp farmers, irrigation is exactly the problem amidst high temperatures and other heat-related challenges.

Challenges for Growing Hemp in Extreme Heat

Heat isn’t the only problem. Water shortages, reduced or adjusted labor hours and questions around the impacts of smoke from nearby wildfires have some farmers wondering if they will reach harvest with a successful yield.

Hemp Plants Are Thirsty: Water Shortage and Restrictions

Kristina Blohkin/Adobe Stock

The Talent Irrigation District, Rogue River Valley Irrigation District and Medford Irrigation District are part of the U.S. Bureau of Reclamation Rogue Basin Project, where Jones focuses most of his work. These districts supply water to thousands in Oregon, and Jones says water levels have never been so low. “The irrigation season usually runs from April 15 through Oct. 15 in the ideal year,” says Jones. “This year, water from those irrigation districts was shut off at the end of July and the beginning of August.”

Ideally, hemp plants go into the ground in June in Jones’ region. Harvest normally begins in September and will run through October. To have the water shut off in July, says Jones, growers will not have an adequate water supply to grow a good yielding crop of hemp, especially those that planted towards the end of the season. Where he used to see large bushy plants, this year Jones sees smaller hemp crop. “I certainly think that that water limitation and some heat stress in June … would limit the size of the size of those plants.”

Impacts of Smoke are Not as Bad as Some Assume

Siskiyou Sungrown is one of the lucky ones, with rights to a deep well that’s kept their crop watered all season long. Grey says sunny and dry weather during harvest is a good thing for the drying process. However, extreme heat and dry conditions are ripe for wildfire—and smoke. Growers and consumers alike are wondering how much impact smoke has on hemp plants.

It is known that wildfire smoke can affect the aroma and flavor of wine grapes. Near Siskiyou, grape growers have had problems with wildfires altering the quality of grapes. However, preliminary research and consumer quality reviews, have not reported any change in aroma or flavor of cannabis grown with surrounding smoke.

“Usually it’s a story of someone looking at the front page of a newspaper on the East Coast, calling and asking, ‘Are you going to send me smoky hemp?'” says Jones. “Or somebody from a competing region saying. ‘Buy my hemp because we’ve not been affected by wildfires smoke.’ The reality is that no research or customer feedback suggests smoke is affecting the quality of hemp flower.”

Smoke can block sunlight. Less light overall can impact how a plant photosynthesizes and may result in smaller plants. In addition to heat and moisture stress, prolonged exposure reduction of sunlight due to smoke can contribute to smaller plants, Jones says.

Some consumers have wondered what impact ash fall has on hemp products. But it’s not a concern, says Jones. It can be easily blown off and won’t clog pores long-term. Not only is ash not a major issue, but every gram of ash that falls on the ground contains nutrients like calcium and potassium. The movement of nutrients across regional ecosystems can be considered a small amount of fertilization. 

Changes to Workforce

It’s not just the plants that are getting stressed out with heat and smoke. Farmworkers have adjusted their schedules and lives around the heat. Grey says some days they started at 3  a.m. to beat the heat. In response, OSHA issued emergency rules to protect workers. Beyond physical exhaustion, Grey says, his team is mentally tired of heat and smoke. “Far and away the greatest impact of the smoke is on the health and morale of the farm team,’ says Grey. “It definitely affects our routine. When we get weeks of hazardous smoke levels, everyone’s morale plummets.”

How Growers Can Protect Their Plants in Extreme Heat

Growing hemp is a continual learning process, but there are proven ways to give plants the best shot at survival for a successful harvest. Farmers’ best bet? Get plants well-established early on.

Establish Plants Early in Good Conditions

A well established plant has a great chance of holding up against extreme heat, smoke and even temporary water shortages. “When they are well established, been in the ground, and have grown good roots, they’ll be resilient,” says Jones. “That’s what we saw for those who planted in early June, a couple weeks before the heat wave. When they had gotten through transplant shock, they did fine.”

At Siskiyou Sungrown, Grey focuses on living soil and uses organic amendments and regular soil testing to foster healthy soil. “We compost all of our on-site organic matter, all of our organic waste. The roots, the stems, the leaves, we compost all of that and put that back into the soil, too, so we’re adding lots of organic matter to the soil every year.” Grey also rotates planting rows every two years and takes a dozen or more samples across fields multiple times a season to amend appropriately.

 

Isaac/Adobe Stock

Keep Hemp Plants Cool

If hemp plants can keep water flowing from roots to leaves, and then evaporate it into the atmosphere, much like our own sweat process, they can keep themselves cool. Jones reiterates it all comes down to the water. “There were folks who transplanted just a few days before that heat wave came,” says Jones. “And some of those fields look really poor.”

Grey also suggests planting in native soil and using a cover crop to keep plants cool. Native soil stays cooler than raised beds and pots. Grey uses a thick layer of mulch, particularly rice straw, which breaks down quickly because of its aquatic nature. This helps keeps the roots cool and moist. Other cover crops farmers can use include clover, buckwheat or oats.

Consider Backup Water Sources

If growers are in an area with water shortages, there is not a lot that can be done.

In water emergencies, there may be possibilities for farmers to gain access to other agricultural water sources like wells or ponds. “Gaining access to new agricultural water is a reasonably challenging process,” Jones says. “They are probably some rare justifications where new wells can be drilled. In some cases, people can get permission to dig a pond on their property to hold water which is something that’s handled by our watermaster’s office.”

In some cases, farmers are choosing to water only the best sections of the crop. Jones watched a farmer sacrifice smaller, weaker plants to reserve the limited water supply he had, for his more-promising crop. “He went ahead and made the decision to cull out those weaker plants … to be able to allocate all of his water to his best-looking plants, rather than trying to keep a poor-looking section of the field limping along,” says Jones. Other farmers have tried bringing water from other sources in by truckloads, but this is a tedious and likely inefficient process for large operations.

A long-term solution would involve changing irrigation infrastructures, but leaky canals and aging irrigation systems are as much a social and political conversation as it is an agricultural one. The cost of infrastructure changes would be hundreds of millions of dollars, says Jones, and a solution that growers can think about and participate in, but not likely to happen in the next few years.

Plant Varieties with Shorter Seasons Can Help Farmers Beat the Heat

Oregon gets most of its water in the fall and winter months. Jones remembers that this year, the reservoirs were not filling properly in February and March. Paying attention to those details can help growers plan, particularly with what hemp variety they choose to plant.

Most hemp growers use a daylight-sensitive variety. It gets planted in Spring, grows vegetatively until it is cued (by daylength) to flower in late summer or fall, and is harvested in September or October. That is a long season and requires water the entire time. Jones points out, however, there are hemp varieties that are daylength neutral, or autoflowering. These plants don’t need a daylength cue. Plants go in the ground and in 50-75 days, plants grow to maturity. “There were a few growers who were able to plant their [autoflowering] crop in late May to early June and were able to harvest them by the end of July just as the water was shut off,” says Jones. The caveat is that these varieties yield smaller plants, though it is still an option for growers who are anticipating a dry season.

Researchers are still exploring which varieties can grow in shorter seasons. They hope in the future they can help growers make informed seed choices in the spring.

What Does Heat Mean for Harvest?

When it comes to heat at harvest time, Grey says heat alone is not that big of an issue. If anything, air conditioning units can be brought in if indoor drying facilities get too hot. The tough part is keeping plants watered in a hot summer. If you can get your plants to survive to harvest time during extreme heat conditions, all else equal, harvest should be smooth sailing.

The Moral of the Story: Hemp is Resilient

Growers and researchers alike are working to learn about the hemp plant while they grow it and respond simultaneously to extreme conditions. “We have a very short history of this sort of field-scale hemp growing that people are doing on tens of acres. It really is a brand-new thing for the high cannabinoid, high-CBD, CBG hemp varieties that have been around just for a handful of years,” says Jones. “People are figuring out for the first time what to do when the water gets shut off in the middle of the summer.”

If farmers can get their plants well established early on and water thoroughly (while it’s available), extreme heat conditions won’t wipe out this resilient crop. Grey became concerned when they had a two-week stretch of heat that was stagnant between 95 degrees and 112 degrees, even though their plants were well established. “I was very concerned about how the plants were going to handle [the heat]. I thought we might have seen a bunch of heat stress out there. Honestly, we didn’t,” says Grey. “I’m realizing that if the plant is healthy and if conditions are right, it can obviously survive at least 112 degrees with no issues.  It’s really changed my view of the plant.”

 

Pacific Northwest heat waves have been challenging growers—and their plants—since June. What do these extreme heat waves mean for hemp crop harvest this fall?

Gordon Jones is an assistant professor of general agriculture based at the Southern Oregon Research and Extension Center for Oregon State University.  Jones says well established hemp plants, transplanted in good conditions with proper root growth, can withstand a fair amount of heat stress—as long as they have access to water. 

But with extreme heat come other obstacles like reduced access to water, wildfire smoke and declining worker morale.

“On some grand level, the smoke, the heat, and the drought are connected, and we could probably have a climate change discussion at the macro scale,” says Jones. These challenges make growing hemp in extreme heat a game of survival. However, there are steps farmers can take early on to prevent heat stress and still have a successful harvest.

What is an ‘Extreme Heat Wave’?

The World Meteorological Organization states that a heat wave is when the daily maximum temperature exceeds the average maximum temperature by 9 degrees Fahrenheit for more than five consecutive days. From June 24 to June 29, Pacific Northwesterners experienced a 1-in-1,000-year heat event when temperatures peaked at 116 degrees.

In extreme heat conditions, hemp leaves droop and fold up in a protective measure. If the stress is not mediated, they will yellow and become crisp. Once a plant is matured, there’s not a lot of changes growers can make, warns Cedar Grey, founder of Siskiyou Sungrown, a CBD wellness product brand in Southern Oregon.

For hemp farmers, high temperatures aren’t the only threat to crops and farmers during extreme heat events. “When it gets to that point, your plant is in trouble,” he says. “By the time the plant is mature, I don’t think there’s a lot of wholesale changes you can make other than ensuring that your irrigation is on point.”

For some hemp farmers, irrigation is exactly the problem amidst high temperatures and other heat-related challenges.

Challenges for Growing Hemp in Extreme Heat

Heat isn’t the only problem. Water shortages, reduced or adjusted labor hours and questions around the impacts of smoke from nearby wildfires have some farmers wondering if they will reach harvest with a successful yield.

Hemp Plants Are Thirsty: Water Shortage and Restrictions

Kristina Blohkin/Adobe Stock

The Talent Irrigation District, Rogue River Valley Irrigation District and Medford Irrigation District are part of the U.S. Bureau of Reclamation Rogue Basin Project, where Jones focuses most of his work. These districts supply water to thousands in Oregon, and Jones says water levels have never been so low. “The irrigation season usually runs from April 15 through Oct. 15 in the ideal year,” says Jones. “This year, water from those irrigation districts was shut off at the end of July and the beginning of August.”

Ideally, hemp plants go into the ground in June in Jones’ region. Harvest normally begins in September and will run through October. To have the water shut off in July, says Jones, growers will not have an adequate water supply to grow a good yielding crop of hemp, especially those that planted towards the end of the season. Where he used to see large bushy plants, this year Jones sees smaller hemp crop. “I certainly think that that water limitation and some heat stress in June … would limit the size of the size of those plants.”

Impacts of Smoke are Not as Bad as Some Assume

Siskiyou Sungrown is one of the lucky ones, with rights to a deep well that’s kept their crop watered all season long. Grey says sunny and dry weather during harvest is a good thing for the drying process. However, extreme heat and dry conditions are ripe for wildfire—and smoke. Growers and consumers alike are wondering how much impact smoke has on hemp plants.

It is known that wildfire smoke can affect the aroma and flavor of wine grapes. Near Siskiyou, grape growers have had problems with wildfires altering the quality of grapes. However, preliminary research and consumer quality reviews, have not reported any change in aroma or flavor of cannabis grown with surrounding smoke.

“Usually it’s a story of someone looking at the front page of a newspaper on the East Coast, calling and asking, ‘Are you going to send me smoky hemp?'” says Jones. “Or somebody from a competing region saying. ‘Buy my hemp because we’ve not been affected by wildfires smoke.’ The reality is that no research or customer feedback suggests smoke is affecting the quality of hemp flower.”

Smoke can block sunlight. Less light overall can impact how a plant photosynthesizes and may result in smaller plants. In addition to heat and moisture stress, prolonged exposure reduction of sunlight due to smoke can contribute to smaller plants, Jones says.

Some consumers have wondered what impact ash fall has on hemp products. But it’s not a concern, says Jones. It can be easily blown off and won’t clog pores long-term. Not only is ash not a major issue, but every gram of ash that falls on the ground contains nutrients like calcium and potassium. The movement of nutrients across regional ecosystems can be considered a small amount of fertilization. 

Changes to Workforce

It’s not just the plants that are getting stressed out with heat and smoke. Farmworkers have adjusted their schedules and lives around the heat. Grey says some days they started at 3  a.m. to beat the heat. In response, OSHA issued emergency rules to protect workers. Beyond physical exhaustion, Grey says, his team is mentally tired of heat and smoke. “Far and away the greatest impact of the smoke is on the health and morale of the farm team,’ says Grey. “It definitely affects our routine. When we get weeks of hazardous smoke levels, everyone’s morale plummets.”

How Growers Can Protect Their Plants in Extreme Heat

Growing hemp is a continual learning process, but there are proven ways to give plants the best shot at survival for a successful harvest. Farmers’ best bet? Get plants well-established early on.

Establish Plants Early in Good Conditions

A well established plant has a great chance of holding up against extreme heat, smoke and even temporary water shortages. “When they are well established, been in the ground, and have grown good roots, they’ll be resilient,” says Jones. “That’s what we saw for those who planted in early June, a couple weeks before the heat wave. When they had gotten through transplant shock, they did fine.”

At Siskiyou Sungrown, Grey focuses on living soil and uses organic amendments and regular soil testing to foster healthy soil. “We compost all of our on-site organic matter, all of our organic waste. The roots, the stems, the leaves, we compost all of that and put that back into the soil, too, so we’re adding lots of organic matter to the soil every year.” Grey also rotates planting rows every two years and takes a dozen or more samples across fields multiple times a season to amend appropriately.

 

Isaac/Adobe Stock

Keep Hemp Plants Cool

If hemp plants can keep water flowing from roots to leaves, and then evaporate it into the atmosphere, much like our own sweat process, they can keep themselves cool. Jones reiterates it all comes down to the water. “There were folks who transplanted just a few days before that heat wave came,” says Jones. “And some of those fields look really poor.”

Grey also suggests planting in native soil and using a cover crop to keep plants cool. Native soil stays cooler than raised beds and pots. Grey uses a thick layer of mulch, particularly rice straw, which breaks down quickly because of its aquatic nature. This helps keeps the roots cool and moist. Other cover crops farmers can use include clover, buckwheat or oats.

Consider Backup Water Sources

If growers are in an area with water shortages, there is not a lot that can be done.

In water emergencies, there may be possibilities for farmers to gain access to other agricultural water sources like wells or ponds. “Gaining access to new agricultural water is a reasonably challenging process,” Jones says. “They are probably some rare justifications where new wells can be drilled. In some cases, people can get permission to dig a pond on their property to hold water which is something that’s handled by our watermaster’s office.”

In some cases, farmers are choosing to water only the best sections of the crop. Jones watched a farmer sacrifice smaller, weaker plants to reserve the limited water supply he had, for his more-promising crop. “He went ahead and made the decision to cull out those weaker plants … to be able to allocate all of his water to his best-looking plants, rather than trying to keep a poor-looking section of the field limping along,” says Jones. Other farmers have tried bringing water from other sources in by truckloads, but this is a tedious and likely inefficient process for large operations.

A long-term solution would involve changing irrigation infrastructures, but leaky canals and aging irrigation systems are as much a social and political conversation as it is an agricultural one. The cost of infrastructure changes would be hundreds of millions of dollars, says Jones, and a solution that growers can think about and participate in, but not likely to happen in the next few years.

Plant Varieties with Shorter Seasons Can Help Farmers Beat the Heat

Oregon gets most of its water in the fall and winter months. Jones remembers that this year, the reservoirs were not filling properly in February and March. Paying attention to those details can help growers plan, particularly with what hemp variety they choose to plant.

Most hemp growers use a daylight-sensitive variety. It gets planted in Spring, grows vegetatively until it is cued (by daylength) to flower in late summer or fall, and is harvested in September or October. That is a long season and requires water the entire time. Jones points out, however, there are hemp varieties that are daylength neutral, or autoflowering. These plants don’t need a daylength cue. Plants go in the ground and in 50-75 days, plants grow to maturity. “There were a few growers who were able to plant their [autoflowering] crop in late May to early June and were able to harvest them by the end of July just as the water was shut off,” says Jones. The caveat is that these varieties yield smaller plants, though it is still an option for growers who are anticipating a dry season.

Researchers are still exploring which varieties can grow in shorter seasons. They hope in the future they can help growers make informed seed choices in the spring.

What Does Heat Mean for Harvest?

When it comes to heat at harvest time, Grey says heat alone is not that big of an issue. If anything, air conditioning units can be brought in if indoor drying facilities get too hot. The tough part is keeping plants watered in a hot summer. If you can get your plants to survive to harvest time during extreme heat conditions, all else equal, harvest should be smooth sailing.

The Moral of the Story: Hemp is Resilient

Growers and researchers alike are working to learn about the hemp plant while they grow it and respond simultaneously to extreme conditions. “We have a very short history of this sort of field-scale hemp growing that people are doing on tens of acres. It really is a brand-new thing for the high cannabinoid, high-CBD, CBG hemp varieties that have been around just for a handful of years,” says Jones. “People are figuring out for the first time what to do when the water gets shut off in the middle of the summer.”

If farmers can get their plants well established early on and water thoroughly (while it’s available), extreme heat conditions won’t wipe out this resilient crop. Grey became concerned when they had a two-week stretch of heat that was stagnant between 95 degrees and 112 degrees, even though their plants were well established. “I was very concerned about how the plants were going to handle [the heat]. I thought we might have seen a bunch of heat stress out there. Honestly, we didn’t,” says Grey. “I’m realizing that if the plant is healthy and if conditions are right, it can obviously survive at least 112 degrees with no issues.  It’s really changed my view of the plant.”

 

The rise in the number of optimistic regulatory frameworks instigated by various regional governments will positively anchor the forecast for the cannabidiol (CBD) market. The growing awareness regarding the benefits and effects of the product as an alternative treatment method has accelerated its preference among consumers and suppliers. Moreover, the continued advancements in the approval processes by various authorities worldwide have also made way for numerous opportunities supporting CBD market growth.

According to a report by Global Market Insights, Inc, the global CBD market size could exceed $108.8 billion by 2027.

Growing presence in cosmetics

The overall industry share from creams and roll-on products is poised to hit a 35.8% CAGR up to 2027. This is owing to the increasing scope of CBD in cosmetic applications as it is highly effective in treating skin conditions. This, as well as its anti-inflammatory characteristics from a medicinal perspective, are leading to increased demand for CBD products like creams and roll-ons.

Scope in the treatment of mental health

CBD market value from anxiety/stress applications exceeded USD 1.5 billion in 2020 due to the growing need for helping mental health. The World Health Organization reported that over 4.5% of the total population in Europe suffers from depression. This escalating anxiety and stress rate has encouraged healthcare practitioners to increasingly make use of CBD-based medications.

Higher demand for oral administration

Demand for oral cannabidiol administration held nearly 45% of the industry proportion in 2020 due to its growing preference considering the gradual relief of pain compared to other disorders. The increasing dependency on the oral administration route for product development by several manufacturers will add positive impetus to market growth.

Medical benefits of cannabis

Annual revenue of the CBD market from the segment of the market dealing with THC (and CBD) products is expected to cross USD 30.1 billion by 2027. This is largely due to its increasing penetration across various countries and regions on account of its legal status. Furthermore, the relatively higher THC content of the compound has led to its growing usage to combat medical conditions, including Alzheimer’s and Parkinson’s disease, among others.

Online distribution to see a considerable footprint

The online CBD industry was responsible for more than 46% of the market in 2020. This is mainly due to the numerous advantages of online channels, like on-time delivery and adequate inventory, compared to their offline counterparts. Besides, this distribution platform minimizes the operational costs related to the maintenance of brick and mortar retail.

Australia to lead the regional landscape

Australia dominated the Asia Pacific CBD market by holding over 25% of the market share owing to the expanding geriatric population and the liberal stance of the regulating bodies in the region. The permittance to the medicinal and cosmetic use of CBD products is likely to spur regional adoption. The rising amendments in regulatory scenarios have also triggered awareness regarding the potential benefits of the product in the country. For instance, in April 2020, the Australian government released a new proposal for over-the-counter CBD in a bid to relax its narcotic scheduling whilst making it a Schedule 3 substance.

Providers of various CBD products are actively indulging in numerous growth strategies, like acquisitions and partnerships, to reinforce their market presence. For example, Mota Ventures Corp., in January 2020, acquired Spanish producer and online retailer, Sativida OU in a USD 2.2 million deal. The acquisition expanded the company’s presence in Europe and Latin America.

Although the demand for CBD is likely to experience certain hesitation from consumers in the short term, the market will witness lucrative growth in the long run. However, counterfeit and substandard quality products may potentially restrain industry expansion to some extent.

Pacific Northwest heat waves have been challenging growers—and their plants—since June. What do these extreme heat waves mean for hemp crop harvest this fall?

Gordon Jones is an assistant professor of general agriculture based at the Southern Oregon Research and Extension Center for Oregon State University.  Jones says well established hemp plants, transplanted in good conditions with proper root growth, can withstand a fair amount of heat stress—as long as they have access to water. 

But with extreme heat come other obstacles like reduced access to water, wildfire smoke and declining worker morale.

“On some grand level, the smoke, the heat, and the drought are connected, and we could probably have a climate change discussion at the macro scale,” says Jones. These challenges make growing hemp in extreme heat a game of survival. However, there are steps farmers can take early on to prevent heat stress and still have a successful harvest.

What is an ‘Extreme Heat Wave’?

The World Meteorological Organization states that a heat wave is when the daily maximum temperature exceeds the average maximum temperature by 9 degrees Fahrenheit for more than five consecutive days. From June 24 to June 29, Pacific Northwesterners experienced a 1-in-1,000-year heat event when temperatures peaked at 116 degrees.

In extreme heat conditions, hemp leaves droop and fold up in a protective measure. If the stress is not mediated, they will yellow and become crisp. Once a plant is matured, there’s not a lot of changes growers can make, warns Cedar Grey, founder of Siskiyou Sungrown, a CBD wellness product brand in Southern Oregon.

For hemp farmers, high temperatures aren’t the only threat to crops and farmers during extreme heat events. “When it gets to that point, your plant is in trouble,” he says. “By the time the plant is mature, I don’t think there’s a lot of wholesale changes you can make other than ensuring that your irrigation is on point.”

For some hemp farmers, irrigation is exactly the problem amidst high temperatures and other heat-related challenges.

Challenges for Growing Hemp in Extreme Heat

Heat isn’t the only problem. Water shortages, reduced or adjusted labor hours and questions around the impacts of smoke from nearby wildfires have some farmers wondering if they will reach harvest with a successful yield.

Hemp Plants Are Thirsty: Water Shortage and Restrictions

Kristina Blohkin/Adobe Stock

The Talent Irrigation District, Rogue River Valley Irrigation District and Medford Irrigation District are part of the U.S. Bureau of Reclamation Rogue Basin Project, where Jones focuses most of his work. These districts supply water to thousands in Oregon, and Jones says water levels have never been so low. “The irrigation season usually runs from April 15 through Oct. 15 in the ideal year,” says Jones. “This year, water from those irrigation districts was shut off at the end of July and the beginning of August.”

Ideally, hemp plants go into the ground in June in Jones’ region. Harvest normally begins in September and will run through October. To have the water shut off in July, says Jones, growers will not have an adequate water supply to grow a good yielding crop of hemp, especially those that planted towards the end of the season. Where he used to see large bushy plants, this year Jones sees smaller hemp crop. “I certainly think that that water limitation and some heat stress in June … would limit the size of the size of those plants.”

Impacts of Smoke are Not as Bad as Some Assume

Siskiyou Sungrown is one of the lucky ones, with rights to a deep well that’s kept their crop watered all season long. Grey says sunny and dry weather during harvest is a good thing for the drying process. However, extreme heat and dry conditions are ripe for wildfire—and smoke. Growers and consumers alike are wondering how much impact smoke has on hemp plants.

It is known that wildfire smoke can affect the aroma and flavor of wine grapes. Near Siskiyou, grape growers have had problems with wildfires altering the quality of grapes. However, preliminary research and consumer quality reviews, have not reported any change in aroma or flavor of cannabis grown with surrounding smoke.

“Usually it’s a story of someone looking at the front page of a newspaper on the East Coast, calling and asking, ‘Are you going to send me smoky hemp?'” says Jones. “Or somebody from a competing region saying. ‘Buy my hemp because we’ve not been affected by wildfires smoke.’ The reality is that no research or customer feedback suggests smoke is affecting the quality of hemp flower.”

Smoke can block sunlight. Less light overall can impact how a plant photosynthesizes and may result in smaller plants. In addition to heat and moisture stress, prolonged exposure reduction of sunlight due to smoke can contribute to smaller plants, Jones says.

Some consumers have wondered what impact ash fall has on hemp products. But it’s not a concern, says Jones. It can be easily blown off and won’t clog pores long-term. Not only is ash not a major issue, but every gram of ash that falls on the ground contains nutrients like calcium and potassium. The movement of nutrients across regional ecosystems can be considered a small amount of fertilization. 

Changes to Workforce

It’s not just the plants that are getting stressed out with heat and smoke. Farmworkers have adjusted their schedules and lives around the heat. Grey says some days they started at 3  a.m. to beat the heat. In response, OSHA issued emergency rules to protect workers. Beyond physical exhaustion, Grey says, his team is mentally tired of heat and smoke. “Far and away the greatest impact of the smoke is on the health and morale of the farm team,’ says Grey. “It definitely affects our routine. When we get weeks of hazardous smoke levels, everyone’s morale plummets.”

How Growers Can Protect Their Plants in Extreme Heat

Growing hemp is a continual learning process, but there are proven ways to give plants the best shot at survival for a successful harvest. Farmers’ best bet? Get plants well-established early on.

Establish Plants Early in Good Conditions

A well established plant has a great chance of holding up against extreme heat, smoke and even temporary water shortages. “When they are well established, been in the ground, and have grown good roots, they’ll be resilient,” says Jones. “That’s what we saw for those who planted in early June, a couple weeks before the heat wave. When they had gotten through transplant shock, they did fine.”

At Siskiyou Sungrown, Grey focuses on living soil and uses organic amendments and regular soil testing to foster healthy soil. “We compost all of our on-site organic matter, all of our organic waste. The roots, the stems, the leaves, we compost all of that and put that back into the soil, too, so we’re adding lots of organic matter to the soil every year.” Grey also rotates planting rows every two years and takes a dozen or more samples across fields multiple times a season to amend appropriately.

 

Isaac/Adobe Stock

Keep Hemp Plants Cool

If hemp plants can keep water flowing from roots to leaves, and then evaporate it into the atmosphere, much like our own sweat process, they can keep themselves cool. Jones reiterates it all comes down to the water. “There were folks who transplanted just a few days before that heat wave came,” says Jones. “And some of those fields look really poor.”

Grey also suggests planting in native soil and using a cover crop to keep plants cool. Native soil stays cooler than raised beds and pots. Grey uses a thick layer of mulch, particularly rice straw, which breaks down quickly because of its aquatic nature. This helps keeps the roots cool and moist. Other cover crops farmers can use include clover, buckwheat or oats.

Consider Backup Water Sources

If growers are in an area with water shortages, there is not a lot that can be done.

In water emergencies, there may be possibilities for farmers to gain access to other agricultural water sources like wells or ponds. “Gaining access to new agricultural water is a reasonably challenging process,” Jones says. “They are probably some rare justifications where new wells can be drilled. In some cases, people can get permission to dig a pond on their property to hold water which is something that’s handled by our watermaster’s office.”

In some cases, farmers are choosing to water only the best sections of the crop. Jones watched a farmer sacrifice smaller, weaker plants to reserve the limited water supply he had, for his more-promising crop. “He went ahead and made the decision to cull out those weaker plants … to be able to allocate all of his water to his best-looking plants, rather than trying to keep a poor-looking section of the field limping along,” says Jones. Other farmers have tried bringing water from other sources in by truckloads, but this is a tedious and likely inefficient process for large operations.

A long-term solution would involve changing irrigation infrastructures, but leaky canals and aging irrigation systems are as much a social and political conversation as it is an agricultural one. The cost of infrastructure changes would be hundreds of millions of dollars, says Jones, and a solution that growers can think about and participate in, but not likely to happen in the next few years.

Plant Varieties with Shorter Seasons Can Help Farmers Beat the Heat

Oregon gets most of its water in the fall and winter months. Jones remembers that this year, the reservoirs were not filling properly in February and March. Paying attention to those details can help growers plan, particularly with what hemp variety they choose to plant.

Most hemp growers use a daylight-sensitive variety. It gets planted in Spring, grows vegetatively until it is cued (by daylength) to flower in late summer or fall, and is harvested in September or October. That is a long season and requires water the entire time. Jones points out, however, there are hemp varieties that are daylength neutral, or autoflowering. These plants don’t need a daylength cue. Plants go in the ground and in 50-75 days, plants grow to maturity. “There were a few growers who were able to plant their [autoflowering] crop in late May to early June and were able to harvest them by the end of July just as the water was shut off,” says Jones. The caveat is that these varieties yield smaller plants, though it is still an option for growers who are anticipating a dry season.

Researchers are still exploring which varieties can grow in shorter seasons. They hope in the future they can help growers make informed seed choices in the spring.

What Does Heat Mean for Harvest?

When it comes to heat at harvest time, Grey says heat alone is not that big of an issue. If anything, air conditioning units can be brought in if indoor drying facilities get too hot. The tough part is keeping plants watered in a hot summer. If you can get your plants to survive to harvest time during extreme heat conditions, all else equal, harvest should be smooth sailing.

The Moral of the Story: Hemp is Resilient

Growers and researchers alike are working to learn about the hemp plant while they grow it and respond simultaneously to extreme conditions. “We have a very short history of this sort of field-scale hemp growing that people are doing on tens of acres. It really is a brand-new thing for the high cannabinoid, high-CBD, CBG hemp varieties that have been around just for a handful of years,” says Jones. “People are figuring out for the first time what to do when the water gets shut off in the middle of the summer.”

If farmers can get their plants well established early on and water thoroughly (while it’s available), extreme heat conditions won’t wipe out this resilient crop. Grey became concerned when they had a two-week stretch of heat that was stagnant between 95 degrees and 112 degrees, even though their plants were well established. “I was very concerned about how the plants were going to handle [the heat]. I thought we might have seen a bunch of heat stress out there. Honestly, we didn’t,” says Grey. “I’m realizing that if the plant is healthy and if conditions are right, it can obviously survive at least 112 degrees with no issues.  It’s really changed my view of the plant.”

 

Let’s just say it. There is an undeniable chaos in the cannabis industry. It doesn’t matter if you’re a big or small operator, it’s likely that you don’t have a documented system for creating and managing ever-changing SOPs or for consistently training all employees on the most current versions of those SOPs. This chaos is often the result of rapid growth, mergers and acquisitions, and the ever-present turnover in our industry. When department leadership changes, and it often does, established policies and procedures are often left behind. In some cases, this is a positive sign of growth. As a company outgrows SOPs and as it develops more sophisticated ways to cultivate, extract, process, manufacture, package and sell cannabis and cannabis products, inevitably, the old ways of doing business need to be replaced. For those operators who have prioritized operational excellence, whether they want to position their company for new investment, merger or acquisition, or just want to create a consistent and standardized, branded product, it’s critical to get control of SOPs, training and documentation.

As with most big goals, to obtain operational excellence, you need to break the goal into manageable steps. Assuming you have accessible quality policies and procedures in place, properly training employees when they first start work and on an ongoing basis as policies and procedures change is the number one key to successful operations. When employees know how to do their job and understand what is expected of them, they are positioned for success. When employees are successful, it follows that the company will also be successful. Documenting operations is a second important step in obtaining operational excellence. While training and documentation appear to be different, in best-practice organizations, they are inextricably linked.

One Set of SOPs

Those of us who have been in the cannabis industry for a while have experienced firsthand or heard stories of facility staff working off of two sets of SOPs. There’s the set of SOPs that are printed or digitally available for the regulators, let’s call them the “ideal” set, and then there are the SOPs that actually get implemented on a day-to-day basis. While this is common, it’s risky and undermines the foundation of operational excellence. Employees often know there are two sets of SOPs. Whether they express it or not, many are uncomfortable with the intentional or unintentional deception. When regulators arrive, will they have to bend the truth or even lie about daily operations? Taking the time to establish and implement one set of approved SOPs that is compliant with both external regulations and internal standards is good for employee morale, productivity and ultimately, profits.

What’s the best way to get control of a facility’s SOPs? Again, break it into manageable steps:

• First, task someone with reviewing all SOPs that are floating around. Determine if any are non-compliant, which ones need to be tossed and which ones need to be revised so they work for the company as well as outside regulatory authorities.
• At a minimum, establish a two-person team to draft, review, publish and distribute the final SOPs. Ensure that at least one member of the team has management level authority. Assign that employee the responsibility of reviewing the SOPs before “publication” and distribution.
• Archive, delete, or actually throw away outdated or non-compliant SOPs
• Revise or create new best-practice SOPs that are in compliance with external regulations and internal standards
• Establish a system to update SOPs when external regulations and internal standards change
• Use a naming convention that distinguishes draft SOPs from final SOPs, for example, “Post-Harvest Procedure, FINAL”
• Inform employees that they will be retrained on the new SOPs and that approved SOPs will always have the word “Final” in the title
• Store the final SOPs in an easily accessible location and give employees access, not only during training, but on an ongoing basis

Centralized Repository for Final SOPs

Storing final, approved SOPs in one easily accessible, centralized location and giving employees access sounds simple, but again, this is the cannabis industry, so this often doesn’t happen. Many of us have or are currently working for an organization that stores SOPs in multiple places. Each department may have its own way of updating, disseminating and storing SOPs. Some SOPs are stored in a printed binder stuffed in a drawer or left on a bottom shelf. Others are stored digitally. Some use both systems, which creates confusion. Who knows if the digital versions or the printed versions are the most current? Surely someone knows, but often the front-line staff do not.“Once you’ve established a single set of compliant SOPs and have stored them in one accessible location, it’s time to train your employees.”

Establishing a centralized repository for final, approved SOPs is the foundation of operational excellence. It lets employees know that operations are organized and controlled, and it reassures regulatory authorities and external stakeholders—think insurers, bankers, investors—that the company prioritizes compliance and organization. And external stakeholders who believe that an organization is proactive and well-run tend to be more forgiving when the inevitable missteps occur. Companies that are organized, have effective training systems, regularly conduct internal audits to identify potential issues and take identifiable action steps when necessary to remediate issues, receive fewer deficiency notices, violations and fines than their less organized competitors.

Train Employees

Many states require cannabis operators to provide a specific number of training hours prior to an employee beginning work, and a specific number of continuing and refresher training hours annually. Once you’ve established a single set of compliant SOPs and have stored them in one accessible location, it’s time to train your employees. To do so, set clear expectations and decide who is responsible for what. Is the HR manager responsible for initial onboarding and training? Are department managers responsible for ongoing and annual training? Create a training responsibility chart that works best for your company; write it down and share with all stakeholders.

The next step is to figure out how to train your employees. Individuals have different learning styles, so ideally, you’ll offer multiple ways for them to master the requirements of their position. Assign written materials and if possible, attach short videos showing the best way to complete a task. Follow up with a quiz to determine comprehension and a conversation with a department lead or manager to answer questions and review the key take-aways. Ideally, the department manager or lead employee will work with the employee until they are competent and comfortable taking on new assigned tasks and responsibilities.

Sum It Up 

Operational excellence begins with:

• Knowledge of and access to current external rules and regulations and internal standards
• One set of approved and easily accessible policies and SOPs that comply with both external and internal standards
• An initial training system with clearly assigned roles, responsibilities, and goals
• An ongoing training system with clearly assigned roles, responsibilities, and goals
• Systems to:
  • Test knowledge before employees begin unsupervised work
  • Stay up-to-date with all changes to external rules and regulations and internal standards
  • Control policy and SOP revision process
  • Inform all stakeholders when policies and SOPs change
  • Test that employees understand new standards
  • Document all key areas of operation on a recurring basis
  • Address deficiencies and evaluate whether SOP revisions are warranted
  • Document and implement necessary remediation when necessary

For those of you rolling your eyes and thinking you don’t have time for this, ask yourself, “Can you afford not to?”

For those of you committed to operational excellence and doing what it takes to get there, congratulations on being a visionary leader. Your efforts will pay dividends for your own company and will help the cannabis industry grow into a well-respected, profitable industry that improves lives.

Pacific Northwest heat waves have been challenging growers—and their plants—since June. What do these extreme heat waves mean for hemp crop harvest this fall?

Gordon Jones is an assistant professor of general agriculture based at the Southern Oregon Research and Extension Center for Oregon State University.  Jones says well established hemp plants, transplanted in good conditions with proper root growth, can withstand a fair amount of heat stress—as long as they have access to water. 

But with extreme heat come other obstacles like reduced access to water, wildfire smoke and declining worker morale.

“On some grand level, the smoke, the heat, and the drought are connected, and we could probably have a climate change discussion at the macro scale,” says Jones. These challenges make growing hemp in extreme heat a game of survival. However, there are steps farmers can take early on to prevent heat stress and still have a successful harvest.

What is an ‘Extreme Heat Wave’?

The World Meteorological Organization states that a heat wave is when the daily maximum temperature exceeds the average maximum temperature by 9 degrees Fahrenheit for more than five consecutive days. From June 24 to June 29, Pacific Northwesterners experienced a 1-in-1,000-year heat event when temperatures peaked at 116 degrees.

In extreme heat conditions, hemp leaves droop and fold up in a protective measure. If the stress is not mediated, they will yellow and become crisp. Once a plant is matured, there’s not a lot of changes growers can make, warns Cedar Grey, founder of Siskiyou Sungrown, a CBD wellness product brand in Southern Oregon.

For hemp farmers, high temperatures aren’t the only threat to crops and farmers during extreme heat events. “When it gets to that point, your plant is in trouble,” he says. “By the time the plant is mature, I don’t think there’s a lot of wholesale changes you can make other than ensuring that your irrigation is on point.”

For some hemp farmers, irrigation is exactly the problem amidst high temperatures and other heat-related challenges.

Challenges for Growing Hemp in Extreme Heat

Heat isn’t the only problem. Water shortages, reduced or adjusted labor hours and questions around the impacts of smoke from nearby wildfires have some farmers wondering if they will reach harvest with a successful yield.

Hemp Plants Are Thirsty: Water Shortage and Restrictions

Kristina Blohkin/Adobe Stock

The Talent Irrigation District, Rogue River Valley Irrigation District and Medford Irrigation District are part of the U.S. Bureau of Reclamation Rogue Basin Project, where Jones focuses most of his work. These districts supply water to thousands in Oregon, and Jones says water levels have never been so low. “The irrigation season usually runs from April 15 through Oct. 15 in the ideal year,” says Jones. “This year, water from those irrigation districts was shut off at the end of July and the beginning of August.”

Ideally, hemp plants go into the ground in June in Jones’ region. Harvest normally begins in September and will run through October. To have the water shut off in July, says Jones, growers will not have an adequate water supply to grow a good yielding crop of hemp, especially those that planted towards the end of the season. Where he used to see large bushy plants, this year Jones sees smaller hemp crop. “I certainly think that that water limitation and some heat stress in June … would limit the size of the size of those plants.”

Impacts of Smoke are Not as Bad as Some Assume

Siskiyou Sungrown is one of the lucky ones, with rights to a deep well that’s kept their crop watered all season long. Grey says sunny and dry weather during harvest is a good thing for the drying process. However, extreme heat and dry conditions are ripe for wildfire—and smoke. Growers and consumers alike are wondering how much impact smoke has on hemp plants.

It is known that wildfire smoke can affect the aroma and flavor of wine grapes. Near Siskiyou, grape growers have had problems with wildfires altering the quality of grapes. However, preliminary research and consumer quality reviews, have not reported any change in aroma or flavor of cannabis grown with surrounding smoke.

“Usually it’s a story of someone looking at the front page of a newspaper on the East Coast, calling and asking, ‘Are you going to send me smoky hemp?'” says Jones. “Or somebody from a competing region saying. ‘Buy my hemp because we’ve not been affected by wildfires smoke.’ The reality is that no research or customer feedback suggests smoke is affecting the quality of hemp flower.”

Smoke can block sunlight. Less light overall can impact how a plant photosynthesizes and may result in smaller plants. In addition to heat and moisture stress, prolonged exposure reduction of sunlight due to smoke can contribute to smaller plants, Jones says.

Some consumers have wondered what impact ash fall has on hemp products. But it’s not a concern, says Jones. It can be easily blown off and won’t clog pores long-term. Not only is ash not a major issue, but every gram of ash that falls on the ground contains nutrients like calcium and potassium. The movement of nutrients across regional ecosystems can be considered a small amount of fertilization. 

Changes to Workforce

It’s not just the plants that are getting stressed out with heat and smoke. Farmworkers have adjusted their schedules and lives around the heat. Grey says some days they started at 3  a.m. to beat the heat. In response, OSHA issued emergency rules to protect workers. Beyond physical exhaustion, Grey says, his team is mentally tired of heat and smoke. “Far and away the greatest impact of the smoke is on the health and morale of the farm team,’ says Grey. “It definitely affects our routine. When we get weeks of hazardous smoke levels, everyone’s morale plummets.”

How Growers Can Protect Their Plants in Extreme Heat

Growing hemp is a continual learning process, but there are proven ways to give plants the best shot at survival for a successful harvest. Farmers’ best bet? Get plants well-established early on.

Establish Plants Early in Good Conditions

A well established plant has a great chance of holding up against extreme heat, smoke and even temporary water shortages. “When they are well established, been in the ground, and have grown good roots, they’ll be resilient,” says Jones. “That’s what we saw for those who planted in early June, a couple weeks before the heat wave. When they had gotten through transplant shock, they did fine.”

At Siskiyou Sungrown, Grey focuses on living soil and uses organic amendments and regular soil testing to foster healthy soil. “We compost all of our on-site organic matter, all of our organic waste. The roots, the stems, the leaves, we compost all of that and put that back into the soil, too, so we’re adding lots of organic matter to the soil every year.” Grey also rotates planting rows every two years and takes a dozen or more samples across fields multiple times a season to amend appropriately.

 

Isaac/Adobe Stock

Keep Hemp Plants Cool

If hemp plants can keep water flowing from roots to leaves, and then evaporate it into the atmosphere, much like our own sweat process, they can keep themselves cool. Jones reiterates it all comes down to the water. “There were folks who transplanted just a few days before that heat wave came,” says Jones. “And some of those fields look really poor.”

Grey also suggests planting in native soil and using a cover crop to keep plants cool. Native soil stays cooler than raised beds and pots. Grey uses a thick layer of mulch, particularly rice straw, which breaks down quickly because of its aquatic nature. This helps keeps the roots cool and moist. Other cover crops farmers can use include clover, buckwheat or oats.

Consider Backup Water Sources

If growers are in an area with water shortages, there is not a lot that can be done.

In water emergencies, there may be possibilities for farmers to gain access to other agricultural water sources like wells or ponds. “Gaining access to new agricultural water is a reasonably challenging process,” Jones says. “They are probably some rare justifications where new wells can be drilled. In some cases, people can get permission to dig a pond on their property to hold water which is something that’s handled by our watermaster’s office.”

In some cases, farmers are choosing to water only the best sections of the crop. Jones watched a farmer sacrifice smaller, weaker plants to reserve the limited water supply he had, for his more-promising crop. “He went ahead and made the decision to cull out those weaker plants … to be able to allocate all of his water to his best-looking plants, rather than trying to keep a poor-looking section of the field limping along,” says Jones. Other farmers have tried bringing water from other sources in by truckloads, but this is a tedious and likely inefficient process for large operations.

A long-term solution would involve changing irrigation infrastructures, but leaky canals and aging irrigation systems are as much a social and political conversation as it is an agricultural one. The cost of infrastructure changes would be hundreds of millions of dollars, says Jones, and a solution that growers can think about and participate in, but not likely to happen in the next few years.

Plant Varieties with Shorter Seasons Can Help Farmers Beat the Heat

Oregon gets most of its water in the fall and winter months. Jones remembers that this year, the reservoirs were not filling properly in February and March. Paying attention to those details can help growers plan, particularly with what hemp variety they choose to plant.

Most hemp growers use a daylight-sensitive variety. It gets planted in Spring, grows vegetatively until it is cued (by daylength) to flower in late summer or fall, and is harvested in September or October. That is a long season and requires water the entire time. Jones points out, however, there are hemp varieties that are daylength neutral, or autoflowering. These plants don’t need a daylength cue. Plants go in the ground and in 50-75 days, plants grow to maturity. “There were a few growers who were able to plant their [autoflowering] crop in late May to early June and were able to harvest them by the end of July just as the water was shut off,” says Jones. The caveat is that these varieties yield smaller plants, though it is still an option for growers who are anticipating a dry season.

Researchers are still exploring which varieties can grow in shorter seasons. They hope in the future they can help growers make informed seed choices in the spring.

What Does Heat Mean for Harvest?

When it comes to heat at harvest time, Grey says heat alone is not that big of an issue. If anything, air conditioning units can be brought in if indoor drying facilities get too hot. The tough part is keeping plants watered in a hot summer. If you can get your plants to survive to harvest time during extreme heat conditions, all else equal, harvest should be smooth sailing.

The Moral of the Story: Hemp is Resilient

Growers and researchers alike are working to learn about the hemp plant while they grow it and respond simultaneously to extreme conditions. “We have a very short history of this sort of field-scale hemp growing that people are doing on tens of acres. It really is a brand-new thing for the high cannabinoid, high-CBD, CBG hemp varieties that have been around just for a handful of years,” says Jones. “People are figuring out for the first time what to do when the water gets shut off in the middle of the summer.”

If farmers can get their plants well established early on and water thoroughly (while it’s available), extreme heat conditions won’t wipe out this resilient crop. Grey became concerned when they had a two-week stretch of heat that was stagnant between 95 degrees and 112 degrees, even though their plants were well established. “I was very concerned about how the plants were going to handle [the heat]. I thought we might have seen a bunch of heat stress out there. Honestly, we didn’t,” says Grey. “I’m realizing that if the plant is healthy and if conditions are right, it can obviously survive at least 112 degrees with no issues.  It’s really changed my view of the plant.”

 

Missouri did not launch medical cannabis sales until Oct. 16, 2020, but a report released earlier this month revealed the extent to which licensed patients were lined up for access.

The Missouri Department of Health and Senior Services (DHSS) issued 56,448 new patient licenses and 12,062 renewed patient licenses between Dec. 6, 2019, and Dec. 5, 2020, according to the department’s second annual report of the Missouri Medical Marijuana Regulatory Program.

The DHSS approved 23,000-plus patients and caregivers in program year 2019—before commercial sales began—with roughly 33% also approved to home cultivate. That year, Missouri home cultivators were comprised of 7,276 patients and 298 caregivers.

But with the state’s first medical cannabis sales launching this past October, the number of approved patients grew by roughly 200% during 2020. In addition, approved caregivers grew from 563 to 2,146, and home cultivators grew from 7,574 to 19,831.

DHSS is required by law to annually submit a report to the governor regarding the efficient discharge of its responsibilities.

“It is an honor to be a part of the great success of this new medical industry in Missouri,” Lyndall Fraker, director of the section of medical cannabis within the DHSS, said in a news release Aug. 19, when the second annual report was published.

“I continue to be amazed at how hard our team is working in order to help our facilities provide this alternative medicine for the state’s fast growing patient base,” he said. “Our goal is to provide a safe, well-regulated and patient-focused program second to none in our great nation. Our success undeniably proves we have accomplished this goal in a timely manner, meeting all of our constitutional obligations as decided by the citizens of the great state of Missouri.”

Sixty-five percent of Missouri voters passed Amendment 2 to legalize medical cannabis during the November 2018 election. A month later, it was added to the Missouri Constitution, granting the DHSS the authority and responsibility to create a well-regulated program to ensure the availability of, and safe access to, medical cannabis.

Including Missouri, 21 states implemented medical cannabis laws since 2005, according to DHSS. While the national average for implementation is 29 months, Missouri implemented its program in just over 23 months. Only five states implemented programs faster: Pennsylvania (22), New York (18), Utah (16), Minnesota (13) and Oklahoma (4), according to DHSS.

The quickest state in the nation to implement an effective medical cannabis program, Oklahoma had roughly 376,000 registered patients as of earlier this month. Voters there approved State Question 788 to legalized medical cannabis on June 26, 2018.

Missouri, by comparison, had 69,387 registered patients as of December 2020. Among those patients, the most common qualifying medical condition listed was a physical or psychological dependence on another drug, with 20,988 individuals checking that box.

Meanwhile, 17,492 patients with non-defined chronic medical conditions were the second most common. Psychiatric disorders accounted for 11,914 patients. Migraines accounted for 3,843 patients. And those suffering from terminal illnesses, such as cancer, represented 2,304 of the qualifying patients.

Those aged 30 to 39 years represented 24.7% of the patients, while 40 to 49 years (20.2%), 50 to 59 years (18%), 60 to 69 years (16.9%), 18 to 29 years (15.1%) and those 70 years and older (4.7%) followed suit. Those 17 and under accounted for 0.3% of patients.

Beginning in December 2019, DHSS issued licenses to all types of medical cannabis facilities after reviewing more than 2,000 applications. As of December 2020, 192 dispensary licenses were issued, as well as licenses for 86 manufacturing and 60 cultivation facilities. However, as of December 2020, only 17 dispensaries, one manufacturer and 10 cultivation facilities had completed a DHSS Commencement Inspection and been given the final approval to operate.

The 192 dispensary licenses allowed in Missouri represent approximately 3.1 dispensaries per 100,000 population in the state, which is third only to Oklahoma (51.8 dispensaries per 100,000) and New Mexico (5.2 dispensaries per 100,000) among the 21 states that have implemented programs since 2005, according to DHSS data compiled from August 2020. Both Oklahoma, which was up to 2,325 dispensaries as of earlier this month, and New Mexico have unlimited licensing systems.

In the current and upcoming program years, DHSS will continue to monitor facilities’ progress and ability to meet the needs of patients, according to the news release.

“We will continue to pursue public engagement and transparency, which has always been a key component of this program’s success, and further develop consistent regulation, enforcement and education in order to ensure it is successful in providing safe and secure access to medical marijuana for qualifying Missouri patients,” Fraker said.

In this “Flower-Side Chats” series of articles, Green interviews integrated cannabis companies and flower brands that are bringing unique business models to the industry. Particular attention is focused on how these businesses integrate innovative practices to navigate a rapidly changing landscape of regulatory, supply chain and consumer demand.

4Front Ventures Corp. (CSE: FFNT) ( OTCQX: FFNTF) is a multi-state operator active in Washington, Massachusetts, Illinois, Michigan and California. Since its founding in 2011, 4Front has built a reputation for its high standards and low-cost cultivation and production methodologies earned through a track record of success in facility design, cultivation, genetics, growing processes, manufacturing, purchasing, distribution and retail. To date, 4Front has successfully brought to market more than 20 different cannabis brands and nearly 2,000 unique product lines, which are strategically distributed through its fully owned and operated Mission dispensaries and retail outlets in its core markets.

We interviewed Andrew Thut, chief investment officer of 4Front Ventures. Andrew joined 4Front in 2014 after investing in the company in 2011. Prior to 4Front, Andrew worked in investment banking and later moved on to public equity where he was a portfolio manager at BlackRock.

Aaron Green: How did you get involved in the cannabis industry?

Andrew Thut: I came at it from the investment side of things. I started my career as a junior investment banker right out of school and then I was a public equity analyst and Portfolio Manager. I ran small-cap growth portfolios for BlackRock where I was on the team for a better part of 11 years.

One of my friends, Josh Rosen, who came from the finance industry, got interested in the cannabis industry really in 2008. He founded 4Front as a consulting company officially in 2011 and I came in as an investor. After that original investment, I left BlackRock and I was looking for something different to do. I was tired of chasing basis points and running public market portfolios. Josh said to me “This industry needs more talent,” and I became more and more involved at 4Front as the years went on. In 2014, I came into the business full time. Originally, I was someone that was kind of the gray hair in the room when we were applying for licenses. We had to go to different municipalities and convince them that we were going to be responsible license holders. I also spent a lot of time on the capital raising side for our business leveraging my career in corporate and more traditional public finance. These are incredibly complex businesses that require a fair amount of capital in some places. So, that’s how I originally got into the business.

These are complicated businesses in a lot of cases. The “sausage making” in cannabis is incredibly complicated. There’s friction at every step along the way. As an example, when you’re buying a building where you want to cultivate your product, you can’t get a mortgage from a typical bank.

While those of us that have been in the industry like to gripe and complain about it, this friction is also the opportunity. Because more traditional investors can’t invest in this industry yet, it allows us more time to build our businesses and have some protective moats around it from a competition standpoint until those folks do come in. So, all this friction is a pain and it’s brutal, but it’s also the opportunity here in cannabis.

Green: Can you speak to the transformation of 4Front from consulting to MSO?

Thut: The original business was consulting. Our original investor was sensitive about touching the plant – it’s one thing to offer services to a federally illegal business, it’s another thing to directly run a federally illegal business. For example, 4Front would have consulting clients that were interested in acquiring a license in Massachusetts. Because of our expertise and our standard operating procedures, we could apply for licenses in limited license states on behalf of our clients and help them show regulators competence and give the regulator’s confidence that these operators knew what they were doing. So, we would help our clients win the licenses and then once those licenses were won, our operations folks would come in and help them get up running.

When I came into the business we said, “well, geez, we have quite a track record helping clients win licenses and get open. If we’re good at winning these licenses and getting them open, why aren’t we just doing this on our own behalf?” So, in 2015, we shifted the business from consulting to being a multi-state operator. We leveraged our capabilities in regulatory compliance and winning licenses to go and get those on our own behalf. We also leveraged our financial expertise in M&A to add to our portfolio, so what we ended up with was a seven-state portfolio at the time.

Green: Chief Investment Officer is an uncommon title, even in the MSO space. What does your day-to-day look like?

Thut: I spend an awful lot of time helping management plot our strategy, and then figuring out how we are going to pay for our growth. Not only structuring finances for the company, but also having contact with our existing and new investors.

I spend a lot of my day to day thinking about where we want to be as a business and what geographies we want to be in. If you look at cannabis longer term, we have less interest in being cultivators or farmers. We think that’s going to be the most quickly commoditized piece of the value chain. We like retail as a business, but I think that we have less interest in managing hundreds of retail locations scattered across the country. We ultimately want to be a finished goods manufacturer. What we think is going to matter longer term is establishing low-cost production.

There is a lot of price elasticity in the end markets for cannabis meaning if you get customers a quality product at a much better price than the competitor, you’re going to take outsize market share. To offer that lower price, you have to be efficient. Over the years, we have figured out how to bring the labor cost out of our production. We have 25 different brands with 1000s of different SKUs of products that have dominant market share in states like Washington. And we’re now putting them into Illinois, Massachusetts, California, Michigan, and hopefully New Jersey.

Green: Do you have a preference towards acquisition, or do you seek growth through internal investments?

Thut: We are always weighing build versus buy. We want our products to have dominant market share, or very strong market share in every state we are in, and we have a lens towards what gets us there faster and most efficiently. For instance, we have two cultivation facilities and one production facility here in Massachusetts – about 15,000 square feet of canopy in the state. That will just about serve our three retail locations in Massachusetts.

Back to our bigger investment thesis, we believe that we should be a finished goods wholesaler in every state that we’re in. We know our products are incredibly well received and we know that consumers love our price point. In Massachusetts, for instance, we’re currently evaluating if we need more capacity from a cultivation standpoint and a production standpoint. And if we do where do the lines cross in terms of whether we should build versus buy that additional capacity?

We are currently in five states, including our facility in Washington has dominant market share in one of the toughest markets in the world for cannabis – somewhere close to 9% market share in Washington. Our brands are in the top 10 of every single category from flower to vapes, to edibles everything across the board. And what we’re doing our strategy is simple. It’s taking those tried-and-true products and operating procedures that have been so effective in Washington, and we’re replicating them in other states where we have licenses: Massachusetts, Illinois, and Michigan, California and hopefully New Jersey. We’re looking for more state, but we want to be deep in the states we’re in.

We also have a lot of confidence that you know, having been having translated some of these, having been able to effectively take our Washington success story and port it to other states. We’re looking for other states to sort of bring into the portfolio because we feel like we’re in a position now to stamp it out.

At our facility in Washington, which is the number one edibles manufacturer in that state, we produce the edible Marmas which is our the number one selling gummy in Washington. We produce 3,500 boxes of those in one shift using 25 people in Washington. Our facility is one of the lowest cost producers in the country.

We are opening what we think is going to be a very disruptive facility in Southern California right now. The facility is 170,000 square feet of purely automated finished goods production. So, rather than making 3,500 boxes of our gummy squares in one shift using 25 people, with the automation that we have in California, we can make 30,000 boxes. So, 10x one shift for the same number of people. We look more like the Mars Candy Company than most investors would think of when they see a typical cannabis company. We’re bringing that kind of scale and automation.

Green: What are some of the industry trends that you’re watching closely?

Thut: We keep a close eye on limited license states. States like Massachusetts and Illinois. For various reasons Massachusetts is very tough to get zoned. So, there’s going to be a limited number of players in a state like Massachusetts, which means you can have pretty good moats around your business and pricing will hold up over several years. We love limited license states like that, where price is going to hold up. On the other hand, we’re not afraid to enter a state like California where we think our low-cost production expertise uniquely qualifies us to go into a huge market like that and be disruptive and take a lot of the pie.

“You’re starting to see the market expand. There’s some anecdotal evidence that we’re taking a fair amount of share from the beer industry.”What we’re seeing in terms of industry trends, particularly on the THC side of this business, has just been phenomenally strong. You’ve had robust medical markets where, by and large, we’re seeing those dominoes start to fall quickly and going recreational. When that happens, the size of the market increases – call it from 2% of the population to as much as 10% of the population. So, from a state regulatory standpoint, having states go form medical to adult use is a huge deal in terms of the market opportunity.

We’re also seeing states get a lot more comfortable with the idea of selling cannabis. I’ve been around for close to seven years in this industry. When I started and I went into a municipality, and I said we wanted to open a cannabis store you’d have people following me to my car with pitchforks. As these municipalities open and public acceptance comes around, people are realizing that these stores are providing jobs and providing a good tax base for communities. So, the acceptance of cannabis has a snowballing effect that just continues to roll.

It’s not just the ultra-frequent users of cannabis who are totally driving the bus in terms of the demand growth for your business. You’re starting to see the market expand. There’s some anecdotal evidence that we’re taking a fair amount of share from the beer industry. So, the fundamentals of this industry are phenomenal. I think that we’re probably in the second inning of what is a mega-trend of legalization of cannabis and the investment opportunity here.

Green: I think one of the interesting things about the fundamentals is you’ve got this hardship of 280E, that all the companies are facing, and yet you still have groups that are surviving, profitable and growing. What are your thoughts on 280E’s effect on cannabis businesses? Do you foresee anything happening there?

Thut: There was a huge liquidity crunch in cannabis in 2019, meaning it was hard for people to come up with capital to grow their businesses. You had a bunch of companies that had licenses who didn’t really know how to operate and weren’t really focused on profitability. That liquidity crunch of 2019 made people get religious about being profitable and being efficient with capital allocation. Fast forward to 2021 and if you look at the top 10 cannabis MSOs in the US, I think we’re all profitable.

So, here you have an industry with accelerating top line growth and they’re already profitable. That profitability should only improve as you’re able to leverage your operating expenses and that’s a unique thing. When the internet craze was started in 1999 you had companies that a weren’t profitable, didn’t have business models, and no one really knew what they wanted to be. You have companies here in cannabis that are growing the top line 50% a year, and they’re profitable, and they’re trading at under 10 times EBITDA, which is totally disjointed.

So, that leads me to your question on to 280E. 280E has been a problem. Banking has been a problem. Having to list our companies over the counter instead of on exchanges like the NASDAQ and NYSE – that’s been a problem in terms of attracting capital. But the good news is Senator Schumer, Senator Booker and others have put out some bold initiatives on what they want to achieve from a legalization standpoint. From an investment standpoint, the biggest thing that investors should be focused on is access to banking, which is included in the senators’ proposed legislation.

Once we get access to banking services, the federal government is basically acknowledging cannabis as an industry will be able to not only have more traditional financing for our growth, but it will also lead to uplift into exchanges and real institutions like the Fidelity’s and the BlackRock’s of the world being able to come and invest in these companies. It also acknowledges 280E is an antiquated law. Getting rid of 280E will give us a much lower tax rate and will allow us to have a bigger proportion of our pretax cash flow into growing our businesses rather than having to go outside for that funding. My crystal ball is probably no better or worse than others in the industry, but if you fast forward 18 months to two years, I have a tough time seeing 280E still in place.

Green: Last question here. What’s the thing you’re most interested in learning about in the cannabis industry?

Thut: I’m just fascinated to see how these various business models will play out. People are placing bets on picks and shovels. People are placing bets on whether being a finished goods manufacturer works. People are placing bets on whether a retailer business model is going to win the day.

If you look at the leadership in the cannabis industry today, it’s totally different than it was four years ago. People that were foregone winners four years ago like MedMen had to do significant recaps. I put Acreage in that sort of bucket too. The leadership had shifted and so I’m really curious to see just from an intellectual standpoint, how this business evolves.

I sometimes scratch my head, you know, do you really want to be a cannabis company with 200 retail locations? You’re going to have a tough time growing same store sales in three to five years in 200 retail locations. So, I’m just most curious in proving out our thesis of being finished goods producers and low cost finished goods producers in the value chain. I’m most curious in seeing how that plays out. I think we are seeing our strategy play out in the most competitive markets in the world. We have a high degree of conviction that we’re on the right track here, but our eyes are always open and we’re always making little pivots here and there trying to make sure to stay on top of the sweet spot in the value curve.

If you describe the cannabis industry generically and you didn’t say cannabis, you said “widget” I think it’s the most fascinating Business School case ever presented. If you’re taking this market that already exists, it’s just illegal. So, all it needs to do is switch from the black market to the legal market and then you’re always trying to plot a course and steer the ship towards where the highest value creation can be. So, I’m fascinated to see how it’s going play out here.

Green: That concludes the interview. Thanks Andrew!

Thut: Thanks Aaron.

Missouri did not launch medical cannabis sales until Oct. 16, 2020, but a report released earlier this month revealed the extent to which licensed patients were lined up for access.

The Missouri Department of Health and Senior Services (DHSS) issued 56,448 new patient licenses and 12,062 renewed patient licenses between Dec. 6, 2019, and Dec. 5, 2020, according to the department’s second annual report of the Missouri Medical Marijuana Regulatory Program.

The DHSS approved 23,000-plus patients and caregivers in program year 2019—before commercial sales began—with roughly 33% also approved to home cultivate. That year, Missouri home cultivators were comprised of 7,276 patients and 298 caregivers.

But with the state’s first medical cannabis sales launching this past October, the number of approved patients grew by roughly 200% during 2020. In addition, approved caregivers grew from 563 to 2,146, and home cultivators grew from 7,574 to 19,831.

DHSS is required by law to annually submit a report to the governor regarding the efficient discharge of its responsibilities.

“It is an honor to be a part of the great success of this new medical industry in Missouri,” Lyndall Fraker, director of the section of medical cannabis within the DHSS, said in a news release Aug. 19, when the second annual report was published.

“I continue to be amazed at how hard our team is working in order to help our facilities provide this alternative medicine for the state’s fast growing patient base,” he said. “Our goal is to provide a safe, well-regulated and patient-focused program second to none in our great nation. Our success undeniably proves we have accomplished this goal in a timely manner, meeting all of our constitutional obligations as decided by the citizens of the great state of Missouri.”

Sixty-five percent of Missouri voters passed Amendment 2 to legalize medical cannabis during the November 2018 election. A month later, it was added to the Missouri Constitution, granting the DHSS the authority and responsibility to create a well-regulated program to ensure the availability of, and safe access to, medical cannabis.

Including Missouri, 21 states implemented medical cannabis laws since 2005, according to DHSS. While the national average for implementation is 29 months, Missouri implemented its program in just over 23 months. Only five states implemented programs faster: Pennsylvania (22), New York (18), Utah (16), Minnesota (13) and Oklahoma (4), according to DHSS.

The quickest state in the nation to implement an effective medical cannabis program, Oklahoma had roughly 376,000 registered patients as of earlier this month. Voters there approved State Question 788 to legalized medical cannabis on June 26, 2018.

Missouri, by comparison, had 69,387 registered patients as of December 2020. Among those patients, the most common qualifying medical condition listed was a physical or psychological dependence on another drug, with 20,988 individuals checking that box.

Meanwhile, 17,492 patients with non-defined chronic medical conditions were the second most common. Psychiatric disorders accounted for 11,914 patients. Migraines accounted for 3,843 patients. And those suffering from terminal illnesses, such as cancer, represented 2,304 of the qualifying patients.

Those aged 30 to 39 years represented 24.7% of the patients, while 40 to 49 years (20.2%), 50 to 59 years (18%), 60 to 69 years (16.9%), 18 to 29 years (15.1%) and those 70 years and older (4.7%) followed suit. Those 17 and under accounted for 0.3% of patients.

Beginning in December 2019, DHSS issued licenses to all types of medical cannabis facilities after reviewing more than 2,000 applications. As of December 2020, 192 dispensary licenses were issued, as well as licenses for 86 manufacturing and 60 cultivation facilities. However, as of December 2020, only 17 dispensaries, one manufacturer and 10 cultivation facilities had completed a DHSS Commencement Inspection and been given the final approval to operate.

The 192 dispensary licenses allowed in Missouri represent approximately 3.1 dispensaries per 100,000 population in the state, which is third only to Oklahoma (51.8 dispensaries per 100,000) and New Mexico (5.2 dispensaries per 100,000) among the 21 states that have implemented programs since 2005, according to DHSS data compiled from August 2020. Both Oklahoma, which was up to 2,325 dispensaries as of earlier this month, and New Mexico have unlimited licensing systems.

In the current and upcoming program years, DHSS will continue to monitor facilities’ progress and ability to meet the needs of patients, according to the news release.

“We will continue to pursue public engagement and transparency, which has always been a key component of this program’s success, and further develop consistent regulation, enforcement and education in order to ensure it is successful in providing safe and secure access to medical marijuana for qualifying Missouri patients,” Fraker said.

Missouri did not launch medical cannabis sales until Oct. 16, 2020, but a report released earlier this month revealed the extent to which licensed patients were lined up for access.

The Missouri Department of Health and Senior Services (DHSS) issued 56,448 new patient licenses and 12,062 renewed patient licenses between Dec. 6, 2019, and Dec. 5, 2020, according to the department’s second annual report of the Missouri Medical Marijuana Regulatory Program.

The DHSS approved 23,000-plus patients and caregivers in program year 2019—before commercial sales began—with roughly 33% also approved to home cultivate. That year, Missouri home cultivators were comprised of 7,276 patients and 298 caregivers.

But with the state’s first medical cannabis sales launching this past October, the number of approved patients grew by roughly 200% during 2020. In addition, approved caregivers grew from 563 to 2,146, and home cultivators grew from 7,574 to 19,831.

DHSS is required by law to annually submit a report to the governor regarding the efficient discharge of its responsibilities.

“It is an honor to be a part of the great success of this new medical industry in Missouri,” Lyndall Fraker, director of the section of medical cannabis within the DHSS, said in a news release Aug. 19, when the second annual report was published.

“I continue to be amazed at how hard our team is working in order to help our facilities provide this alternative medicine for the state’s fast growing patient base,” he said. “Our goal is to provide a safe, well-regulated and patient-focused program second to none in our great nation. Our success undeniably proves we have accomplished this goal in a timely manner, meeting all of our constitutional obligations as decided by the citizens of the great state of Missouri.”

Sixty-five percent of Missouri voters passed Amendment 2 to legalize medical cannabis during the November 2018 election. A month later, it was added to the Missouri Constitution, granting the DHSS the authority and responsibility to create a well-regulated program to ensure the availability of, and safe access to, medical cannabis.

Including Missouri, 21 states implemented medical cannabis laws since 2005, according to DHSS. While the national average for implementation is 29 months, Missouri implemented its program in just over 23 months. Only five states implemented programs faster: Pennsylvania (22), New York (18), Utah (16), Minnesota (13) and Oklahoma (4), according to DHSS.

The quickest state in the nation to implement an effective medical cannabis program, Oklahoma had roughly 376,000 registered patients as of earlier this month. Voters there approved State Question 788 to legalized medical cannabis on June 26, 2018.

Missouri, by comparison, had 69,387 registered patients as of December 2020. Among those patients, the most common qualifying medical condition listed was a physical or psychological dependence on another drug, with 20,988 individuals checking that box.

Meanwhile, 17,492 patients with non-defined chronic medical conditions were the second most common. Psychiatric disorders accounted for 11,914 patients. Migraines accounted for 3,843 patients. And those suffering from terminal illnesses, such as cancer, represented 2,304 of the qualifying patients.

Those aged 30 to 39 years represented 24.7% of the patients, while 40 to 49 years (20.2%), 50 to 59 years (18%), 60 to 69 years (16.9%), 18 to 29 years (15.1%) and those 70 years and older (4.7%) followed suit. Those 17 and under accounted for 0.3% of patients.

Beginning in December 2019, DHSS issued licenses to all types of medical cannabis facilities after reviewing more than 2,000 applications. As of December 2020, 192 dispensary licenses were issued, as well as licenses for 86 manufacturing and 60 cultivation facilities. However, as of December 2020, only 17 dispensaries, one manufacturer and 10 cultivation facilities had completed a DHSS Commencement Inspection and been given the final approval to operate.

The 192 dispensary licenses allowed in Missouri represent approximately 3.1 dispensaries per 100,000 population in the state, which is third only to Oklahoma (51.8 dispensaries per 100,000) and New Mexico (5.2 dispensaries per 100,000) among the 21 states that have implemented programs since 2005, according to DHSS data compiled from August 2020. Both Oklahoma, which was up to 2,325 dispensaries as of earlier this month, and New Mexico have unlimited licensing systems.

In the current and upcoming program years, DHSS will continue to monitor facilities’ progress and ability to meet the needs of patients, according to the news release.

“We will continue to pursue public engagement and transparency, which has always been a key component of this program’s success, and further develop consistent regulation, enforcement and education in order to ensure it is successful in providing safe and secure access to medical marijuana for qualifying Missouri patients,” Fraker said.