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Will 2021 be the year of cannabis delivery?

Will 2021 be the year of cannabis delivery?

Cannabis delivery could become more available in 2021

With more sales than any other year and demand for cannabis higher than ever, will 2021 be the year cannabis delivery becomes widespread?

2020 was a difficult year, as if that even needs to be said. But there was one thing that helped millions of Americans get through the year.

Cannabis.

That’s not an exaggeration either. Americans bought 67% more cannabis in 2020 than the year before to deal with the stress of COVID-19, record unemployment and peak division in the country.

However despite the huge increase in sales, only a handful of states offer delivery options for recreational cannabis consumers.

Cannabis Delivery

Arizona, Arkansas, California, Colorado, Maine, Maryland, Massachusetts, Michigan, Nevada, New Mexico, New York, Oregon, Rhode Island and Vermont, are all technically states that offer some form of delivery service for consumers.

Strict regulations and limitations however have made it so only a few of the states listed actually have a current, implemented delivery system. For example, Massachusetts has been dealing with resistance to their new delivery rules, with the cannabis dispensary association in the state going so far as to sue. Colorado, while passing a law allowing delivery in 2019, has yet to implement it for medical patients, while recreational consumers might have to wait until 2022 for access to the same service.

Other states in the list have only recently legalized medical or recreational cannabis with inclusions for delivery in their legislation. These states such as Arizona, Arkansas, New Mexico and others, while passing legalization bills in 2020, have yet to begin sales of cannabis in general, meaning delivery also hasn’t begun.

The question that a lot of consumers are asking, especially after going through a year of the country’s worst pandemic since the early 1900s and bolstering cannabis sales like never before, is where the hell is the delivery option?

COVID and cannabis

The impact of COVID-19 on businesses across every industry in the country has been stark. Yet while thousands of businesses suffered and even closed down, cannabis businesses everywhere thrived. But almost every single sale was done in-person.

This doesn’t seem to fit the overarching narrative of the last year that social distancing and avoiding others is all but paramount. In this same time Drizly, an alcohol delivery app, became available in 26 states.

In other words, half the country can get alcohol delivered to their door, yet only a couple states allow those with legal access to cannabis to have it delivered. And that is all missed revenue. Bud.com, a delivery service that operates in Northern California, experienced a 500 percent increase in sales after lockdown orders in mid-March, according to Dean Arbit, the chief executive of the company.

So if there’s no shortage of evidence that cannabis delivery can be highly profitable, what are we, or more accurately, what are states waiting for?

Will 2021 be the year?

The events (and profits) of 2020 definitely have more states and cannabis businesses talking about delivery. With no end to social distancing and COVID restrictions in sight, we should expect cannabis sales to continue to grow through 2021, with demand for delivery options growing as well.

Similarly to legalization in general, no state has the same cannabis delivery laws. In other words, there is no single template for states to follow that has seen continued success. Like legalization, some states may be waiting to see another implement delivery successfully from the start, and copy them.

Other states have issues with the laws they already have, such as competition against brick and mortar stores in states that allow delivery straight from distribution centers.

There is little doubt the more states will legalize some form of cannabis delivery in 2021. To expect every state with recreational or medical cannabis to make it available however is a big ask. One that is highly unlikely to happen in just one year.

But if there is any way to describe the cannabis legalization movement, it’s unpredictable.

Cannabis dispensary association drops suit over delivery rules

Cannabis dispensary association drops suit over delivery rules

Massachusetts Cannabis association pulls lawsuit against delivery option

Stung by an exodus of members since it filed suit to block new cannabis industry rules permitting home delivery, the business group that represents most of the state’s brick-and-mortar marijuana shops announced Monday morning that it is dropping the legal challenge.

The Commonwealth Dispensary Association and its attorneys from Foley Hoag argued in a suit that the new delivery-only license types created by the Cannabis Control Commission violated the state’s marijuana law, which they said gives the retailers the right to deliver cannabis under their existing licenses.

“Simply, the CCC overstepped its authority and disregarded state law, radically upending the established rules that hundreds of small businesses and their host communities operated in accordance with since 2016,” the CDA said in a statement when it filed its suit earlier this month.

The lawsuit was seen by some as an attack on the disadvantaged entrepreneurs and small businesses that the CCC’s new delivery model was intended to help and a number of retailers publicly broke from the CDA as news of the suit spread. Delivery-only licenses with the ability to buy marijuana wholesale will be available exclusively to participants in the CCC’s social equity program and economic empowerment applicants for the first three years.

“We are leaving because of our belief in creating economic opportunity for social equity applicants,” Cultivate, which has shops in Leicester and Framingham and was one of the first two non-medical retailers to open in the state, said. New England Treatment Access, one of the state’s largest marijuana firms with shops in Northampton and Brookline, and about 10 other companies also left the CDA in recent days, the Boston Globe reported.

The CCC’s new regulations create two delivery license types: a “marijuana delivery operator” that can buy products wholesale from growers and manufacturers and sell them to their own customers, and a “marijuana courier” that can charge a fee to make deliveries from CCC-licensed retailers and dispensaries. Advocates have argued that delivery-only licenses will help level the playing field between large corporations and small businesses because the barriers to entry for delivery are less burdensome than those for retail licenses.

The CDA said the “difficult decision” to sue the CCC over the delivery rules was “supported by the vast majority of members” and “reflected our concerns on the negative impact these regulatory changes might have on the industry as a whole.” Still, CDA leaders said they decided “it is in the best interest of the industry and our members to drop the lawsuit.”

“We all need to be working together on achieving our many shared objectives, including increasing the participation of a diverse set of entrepreneurs in the industry,” the group said as it pledged to work with groups like the Massachusetts Cannabis Association for Delivery (MCAD).

USDA Releases Final Ruling on Hemp

USDA Releases Final Ruling on Hemp

USDA final ruling on hemp has been released

From sampling to THC testing, here’s a rundown on how the final rule, which takes effect in March, compares to current regulations.

On Jan. 15, the U.S. Department of Agriculture’s (USDA’s) Agricultural Marketing Service (AMS) released a final rule on hemp based on its previous set of regulations that drew public comments from nearly 6,000 people.

The latest set of regulations makes several highly requested changes to the interim final rule (IFR) that are seen as favorable to both hemp producers and regulators.

Still, contentious aspects of the IFR remain, but some industry members are hopeful there is still time to amend them.

Sampling

The final rule made several changes to sampling that should reduce burdens on both growers and regulators.

First, the rule increased the sampling window, which is currently 15 days. Samples for testing now need to be taken up to 30 days before a farmer plans to harvest, giving regulators more time to get into fields. Many stated in public comments that 15 days was far too little time to collect an appropriate amount of samples from each producer in the state.

The rule also slightly modified from where on the plant samples need to be taken. While the IFR required collecting a sample from the top third portion of the plant, the final rule now states samples should be taken “approximately five to eight inches from the ‘main stem’ (that includes the leaves and flowers), ‘terminal bud’ (that occurs at the end of a stem), or ‘central cola’ (cut stem that could develop into a bud) of the flowering top of the plant.”

Andrea Hope J. Steel, the director at Coats Rose P.C. and co-leader of the law firm’s Cannabis Business Law group, tells Hemp Grower this provision will allow sampling agents to collect more stem and leaf material than previously allowed.

That will help reduce instances of hot crops,” Steel says. Stems and leaves typically contain lower levels of cannabinoids—and specific to this issue, of tetrahydrocannabinol (THC)—than the flowers.

However, Graff says this still requires sampling from primarily floral material despite comments on the IFR that requested switching to a whole-plant sampling approach.

The final rule dedicates a significant portion of its 300 pages to addressing and responding to the most highly requested comments, including those on sampling.

“Even though many commenters felt that whole plant sampling should be allowed, AMS is of the opinion that since THC [tetrahydrocannabinol] is concentrated in the flower material of the plant, the flower material is more appropriate to test than the entire plant,” the final rule states.

Perhaps most significantly, the final rule has changed sampling protocol from collecting a “representative sample of every lot [growers] plan to harvest” using specific methodology, according to the IFR, to allowing states and tribes to implement a more “performance-based” method.

The AMS says these performance-based sampling protocols may take into account:

  • seed certification processes (or other processes that identify varieties that have consistently produced compliant hemp plants);
  • whether the producer is conducting research on hemp at an institution of higher learning or that is funded by a federal, state or tribal government;
  • whether a producer has consistently produced compliant hemp plants over an extended period of time;
  • whether a producer is growing “immature” hemp, such as seedlings, clones, microgreens or other non-flowering cannabis, that does not reach the flowering stage;
  • other similar factors.

“Flexibilities afforded to States and Indian Tribes developing their own hemp production plans will allow them to incorporate best practices, as those change and develop over time. For example, States and Indian Tribes can adapt field-walking patterns to various sized and shaped hemp grower operations,” the final rule states. “AMS believes that a national standard would be difficult to consistently apply given the various grower operations and that standard ‘zig-zag,’ or letters ‘M’ or ‘Z’ walk patterns may not be feasible for sample collection of micro-acreage producers, very large scale producers or those with polygonal hemp lots.”

States will need to include details of their performance-based sampling methods in their hemp plans, which the USDA must approve. (An updated guide on sampling has been published on the AMS website.)

Testing

While the final rule implemented generally positive sampling changes for the industry, THC testing will, for the most part, remain burdensome. 

The final rule retains that hemp must remain below 0.3% total THC on a dry-weight basis. Total THC is defined as the sum of the delta-9 THC and tetrahydrocannabinolic acid (THCA). On its own, THCA does not produce psychoactive effects like delta-9 THC, but it can be converted to THC through decarboxylation, which is the process required for testing.

While increasing that limit was one of the most highly requested changes in public comments, the USDA was unable to do so, as that limit was written into law in the Agriculture Improvement Act of 2018 (the 2018 Farm Bill). It’s notable that total THC, however, was not written into the farm bill—that bill defines hemp only by delta-9-THC levels. In its final rule (as well as the IFR), the USDA interprets the language of the farm bill to mean that total THC must be tested.

However, legislation has been introduced in both Kentucky and at the federal level by Sen. Rand Paul to amend that limit to 1%, which would quell the total THC versus delta-9-THC debate.

Options for Hot Hemp

If hemp does test “hot” above the 0.3% THC limit, the final rule has given producers additional options for disposal beyond the total destruction written into the IFR.

States now have several options for more productive and less wasteful methods of disposal that can result in useful soil amendments. Those include:

  • plowing under
  • mulching/composting the hemp
  • disking
  • shredding the biomass with a bush mower or chopper.

Producers may also bury or burn their hot hemp. (The AMS implemented these additional options in early 2020, but they were not written into the IFR.)

The final rule also implements a brand-new option for hot crops: remediation.

The rule states producers can remediate their material by “removing and destroying flower material, while retaining stalk, stems, leaf material, and seeds.” Producers may also shred the entire plant to create a “biomass-like material” and then retest it for compliance.

Producers also no longer need to use a DEA-registered distributor or law enforcement to dispose of hot hemp.

Read the Full Story from Hemp Grower Magazine

Czech medical cannabis sales surge, but market remains small

Czech medical cannabis sales surge, but market remains small

czech medical marijuana sales surge but industry remains small

The Czech market for medical cannabis flower quadrupled last year compared to 2019, according to data published by the State Agency for Medical Cannabis.

However, the market remains very small.

In 2020, roughly 68 kilograms (150 pounds) of medical cannabis flower was sold to patients in Czech pharmacies, compared with 17 kilograms the year before, the data shows.

Expectations that the market would see a tremendous boost after medical cannabis was included in the country’s public health insurance in early 2020 have so far failed to materialize.

Experts say that is partly because insurance coverage is only one of many factors guiding the market’s development.

As Marijuana Business Daily previously reported, bureaucratic hurdles and limited participation in the medical marijuana program by doctors and pharmacies represent challenges that were not resolved with the introduction of the health insurance-coverage scheme.

Despite that, the market is growing with improved access.

October and November saw record sales of medical cannabis, with about 7 kilograms sold each month.

The number of unique patients, which was below 500 at the end of 2019, doubled to 1,103 in December 2020.

The number of doctors prescribing cannabis products also increased.

In December 2019, 78 doctors prescribed cannabis. That number grew to 123 by December 2020.

Since the beginning of last year, Czech patients have been entitled to insurance coverage on 90% of the retail price for 30 grams of flower per month for medical use, regardless of THC content.

In exceptional cases, doctors may authorize quantities exceeding the monthly limit of 30 grams for reimbursement, up to a maximum of 180 grams per month.

In practice, however, patients received roughly 6 grams per month on average during the final months of 2020.

Almost 80% of the cannabis prescriptions last year were to treat chronic pain.

Elkoplast Slušovice remains the only domestic producer, with the rest of the supply coming from Canadian producers Aurora Cannabis and Canopy Growth.

Enthusiasm For Oklahoma’s Medical Marijuana Boom Tempered By Concerns Of A Bust

Enthusiasm For Oklahoma’s Medical Marijuana Boom Tempered By Concerns Of A Bust

Oklahoma medical marijuana boom could be short lived, some worry

Oklahoma has what many consider to be the only free-enterprise medical marijuana industry in the U.S., with cheap startup fees, no cap on medical marijuana business licenses and few limits on who can get a patient card. But this low barrier to entry could lead to an oversaturated market where cannabis businesses struggle to survive.

Jessica Baker, owner of Bakers Cannabis Dispensary in northwest Oklahoma City, has witnessed the growing pains other young marijuana industries like Oklahoma’s have experienced over her two decade career in the business.

She and her husband Chip started growing medical cannabis in California in 1997, which eventually led them to Colorado, where Chip opened a couple of hydroponic stores.

After the passage of State Question 788 in June of 2018, which legalized medical marijuna in Oklahoma, Chip noticed he started receiving an influx of business from Oklahoma.

“People were ordering lights and soil and nutrients,” Jessica said.

The Bakers saw promise in Oklahoma’s medical marijuana market and decided to move to the state at the end of 2018.

In addition to the dispensary and its attached clone nursery, Chip owns a nearby hydroponic store in OKC, and Jessica has a marijuana farm and processor about 40 miles northeast of the city.

Jessica said it’s been a nice change of pace doing business in Oklahoma’s medical marijuana market.

“My businesses have primarily been in California where it’s very difficult and expensive,” Jessica said. “Oklahoma in general… they made it pretty easy for people, which is nice and affordable.”

Oklahoma has some of the cheapest annual commercial licensing fees in the country at $2,500, especially compared to California where licensing fees can reach six figures and range depending on estimated annual gross revenue.

There’s also no limit on licensed medical marijuana businesses in Oklahoma unlike other states such as Louisiana where only one dispensary is allowed in each of the state’s nine regions.

And with no list of qualifying conditions, it’s easy to get a physician to write a recommendation for a medical marujuana patient card. This has led to over 367,000 Oklahomans, nearly 10% of the state’s population, obtaining a medical marijuana patient card, which according to Politico makes Oklahoma the largest medical marijuana market per capita.

Jay Czarkowski, founding partner of the marijuana business consulting firm Canna Advisors, said Oklahoma’s medical marijuana program has grown rapidly. 

“The medical marijuana program in Oklahoma, it’s such an open, liberal program, it is almost like adult use legalization,” Czarkowski said. 

Oklahoma is just shy of having 10,000 active licensed medical marijuana businesses, which includes over 2,000 dispensaries and about 6,500 growers. 

Jessica was surprised about Oklahoma’s medical marijuana industry. So many people with little to no prior experience with cannabis were so eager to get into the business.  

“It says something about people from Oklahoma… that they would just jump into something of the unknown and kind of gamble on it, which is a pretty cool quality,” she said. 

But the flip side to Oklahoma’s low barrier of entry for starting a medical marijuana business is the pressure it puts on the market. 

Sarah Lee Gossett Parrish, an Oklahoma attorney who represents over 150 cannabis businesses, said some enter the market with the misconception that it will be fast money. 

“You have people getting into it who don’t understand that the cannabis industry is just like any other business,” she said. “You have to work hard and have a strong business acumen and know what you’re doing.”

Because there are so many growers, Gossett Parrish said they need to zero in on a market to avoid being eclipsed by larger growers that generate a massive supply of product. 

“If you are a craft grower and maybe an organic grower and you pick and choose certain illnesses and conditions for which you grow strains and you target your market, then you’re going to fare well,” Gossett Parrish said. 

Unless the state legalizes recreational marijuana within the year, Jessica expects many cannabis businesses will have to shut down. She said there’s more marijuana than there is demand from patients.

Original Story from KGOU

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Recreational marijuana sales in Arizona could start this week

Recreational marijuana sales in Arizona could start this week

Cannabis dispensaries in Arizona could open this week.

Marijuana sales to anyone 21 or older in Arizona could start within a day or two, with state health officials telling dispensaries they are poised to issue licenses for recreational sales.

The first stores able to sell recreational marijuana and marijuana products, such as vape pens and gummy edibles, are existing medical-marijuana dispensaries. Some of those businesses said Tuesday they are awaiting approval from state regulators to show up online so they may open their doors to anyone with a state-issued ID. 

“I’m sitting here at my computer hitting refresh, refresh,” said Raúl Molina, a partner and senior vice president of operations for The Mint dispensaries in Mesa and Guadalupe.

A spokesman for the Department of Health Services said 40 medical dispensaries had applied to sell recreational marijuana as of Tuesday afternoon.

The quick turnaround for licenses was unexpected by some dispensary owners, who anticipated the state agency would use the full amount of time given under the law to approve applications, meaning recreational sales wouldn’t begin until March or April.

About two-thirds of dispensaries in the state have yet to make an application, meaning their competitors will have a jump on them in attracting the recreational market.

Molina said he is ready to begin sales as soon as he gets the OK, and that officials with the Department of Health Services told him it could come at any time.

“I am so ready,” Molina said, adding that he has submitted documents to the state for his employees to work in a recreational dispensary, stocked childproof packaging, added cash registers and programmed them to add the appropriate tax to recreational sales, and bought an additional 800 pounds of marijuana in the past month to meet the anticipated demand.

“We expect rushes like 4/20 (April 20) for probably like 10 to 30 days straight,” he said. “Basically it’s going to be 4/20 for a full month.”

Molina said he has dedicated registers for medical-marijuana patients to prevent a displacement by new recreational customers.

Arizonans approved Proposition 207 in November, legalizing adult use and possession of marijuana. The measure also allowed the state’s 120 or so operating medical-marijuana dispensaries to apply for a license to sell to any adult, not just those who have a state-issued medical-marijuana card.

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