Where Did All the Cheap Pounds Go?

By Scott Catron - Own work, CC BY 2.5, https://commons.wikimedia.org/w/index.php?curid=848745

This is a question I’ve been hearing more recently in California. Dispensaries, vape pen companies and edible makers are typically looking for the cheapest pounds of cannabis they can get, but quality has become a much larger factor than ever before. But why is it so hard to get clean cannabis flowers at $1200-$1300 per pound now?

As I’ve interacted with the community over the last few months, these are the points that seem to have lead to this change:

1. Empowered, Branded Farmers

Farmers of high-end products aren’t willing to take low-ball prices for top products anymore. And they are less likely to work with dispensaries that won’t include their branding. One of my favorite stories is from Casey O’Neill of Happy Day Farms when a dispensary buyer was low-balling prices on his pounds — Casey asked the buyer: “OK. How much of the love do you want me to take out?”

Setting aside the high-end farmers for a moment, cannabis producers across the spectrum are building brands in a variety of niches. Most producers weren’t interested in branding themselves until recently due to legal concerns, and dispensaries have become accustomed to negotiating hard against them because of this gap in regulation. Though the retail price to patients has not changed significantly since 1996, dispensaries have been increasing their profit margins by decreasing payouts to producers.

Part of the power discrepancy between dispensaries and producers is rooted in this: dispensaries were regulated first and for more than a decade without regulating production at all. But let’s be completely fair about the cost of running such a facility: a dispensary has to do what it does without major banking access and will often need to make significant, costly changes at the whims of local municipalities.

2. Enter the Distribution Companies

Distribution companies like River Collective are buying some pounds at this low-price level (as some farmers have told me) but even River can’t get enough to satisfy it’s hunger to distribute to the wide state market. River is an exclusive distribution contract, as I understand it, so be sure you get the price you want if you sign up for such a contract.

3. Testing and the Demand for Clean Product

Testing has taken a chunk of unclean product out of the market. The industry demand for testing and to have products clean of pesticide residue, mold and pathogens has changed the market without even being law yet. Edible and vape pen companies have an exceedingly hard time buying oil or flowers that are clean, and a small business can be put into a bad spot if they buy product that turns out to be contaminated. The industry has changed.

4. The Big Reason

B-buds, trim, (sometimes A-buds) and shake are being turned into rosin, juice, edible oil, salves or other creative products. Much like turning milk into butter or felled trees into boards, cannabis farmers are able to demand higher prices for value-added products than for the raw material. So in an age where dispensaries haven’t updated their buying practices to accommodate the growing flower brands of the California industry, it’s not a big surprise that much of the crop is turned into oil.

Bad Bud Doesn’t Make Good Oil

When I was interviewing Bruce of Southern Humboldt Concentrates about the Emerald Cup, he said he sees too many attempts at “recycling” unclean flower into oil or product with too much solvent remaining. “People look at what we’re doing as if it’s just money. It’s money and a recycling thing, I’ve noticed. People want to grow a bunch of herb, want to grow good weed, but it goes bad and people say ‘we’ll just turn it into concentrate.'”

“This isn’t a recycling machine.” Bruce said of the oil-making process. “We’re trying to make clean product, medicine for people. ‘Let’s recycle’ is the attitude that I’m seeing. The idea should be to grow the best cannabis.”

The Emerald Cup opening the competition up to Rosin and BHO will reward the producers who are doing it right, Bruce said.

But what can a producer do with a moldy or otherwise contaminated crop? This question has lead me down some interesting paths so we shall see where it leads …

 

Photo By Scott CatronOwn work, CC BY 2.5, Photo source.

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