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Minnesota Cannabis Producers Given the Greenlight

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Minnesota cannabis producers have raised concerns over the availability of products when the legal market finally opens. In response, the Minnesota legislature has acted quickly to allow an avenue for early cultivation providing key guidance for the forthcoming Minnesota legal cannabis market. Noting these concerns, industry participants have asked the Minnesota Office of Cannabis Management (OCM) and their local legislators to consider opening cultivation and production of cannabis products early, in order to supply retailers with legal products to sell once licenses are awarded and retailers open for business.

The OCM’s problematic decision not to endorse or seek immediate changes for Minnesota cannabis production

The OCM issued a statement recently indicating it will not ask for changes to the current laws that would allow some cannabis cultivators to start growing plants early as a way to have products available and ready for retail when stores open sometime in early spring of 2025. The OCM notes that they remain receptive to proposals that could pave the way for early production, but are not seeking immediate action at this time. This recent decision highlights the issues and complexities of introducing a new legal cannabis market into an already existing marketplace. The main issue surrounds how legal retailers could open for business if they do not have any legal cannabis products to sell.

The OCM suggests additional delays could occur

One option would be to rely on existing medical cannabis rules for early cultivation. However, concerns that issuing producer licenses contemporaneously with retail licenses would cause unnecessary delays, are met with concerns over unnecessary delays from the OCM. The OCM notes that reliance on the existing medical cannabis rules presents inherent flaws, particularly in accommodating outdoor farms and ensuring equitable opportunities for social equity applicants. Allowing for early cultivation under the existing medical cannabis requirements only exacerbates challenges faced by social equity applicants and would place legal producers outside of the existing medical regulatory framework at a disadvantage.

Despite concerns legislators took action and have provided a proposal for early cultivation

Senator Lindsey Port spearheaded amendments, which culminated in floor debate lasting over six hours. In response to the challenges facing producer and retail licenses, as well as accommodating outdoor farms, ensuring equal access for social equity applicants, or allowing early cultivation under the existing medical cannabis regulatory framework, legislators are took up the issue and provided additional proposals. The amendments were aimed at facilitating early cultivation, an essential step towards nurturing a robust and inclusive cannabis market. These amendments seek to grant permission for early production to social equity producers, addressing the imperative of equitable participation in the anticipated Minnesota legal cannabis industry. By integrating the existing medical cannabis regulations with newly proposed social equity pre-approved licenses, Senator Port’s amendments offer a pragmatic framework for expediting cultivation timelines while safeguarding the interests of diverse stakeholders.

Early cultivation is key to a strong launch

The significance of early cultivation cannot be overstated in the context of Minnesota’s nascent legal cannabis market. Not only will Minnesota’s legal cannabis market be forced to compete with the existing illegal market, the same as every other state, but the new legal market will also be competing with the existing THC beverage and lower-potency hemp edible markets. Early cultivation holds the key to undermining the influence of illicit markets and channeling demand towards legal and regulated avenues, but only if the legal cannabis market can get a strong launch. Moreover, early cultivation will serve as a lifeline for small businesses and social equity applicants, affording them a crucial head start and robust launch in an industry characterized by fierce competition and evolving regulatory dynamics.

Licensing and lottery system concerns for Minnesota cannabis producers

Understanding the nuances of licensing is integral to navigating Minnesota’s cannabis marketplace. Although licenses will not be issued until early 2025 at the earliest, and the full regulatory framework has not been finalized, producers and cultivators will have access to three distinct production license categories – bulk cultivators, mezzo licenses, and micro licenses. Each category carries with it separate requirements and allowances regarding canopy space, facility size, quality control requirements, staffing protocols, and more. Notably, lower-potency hemp cultivation and sale remain exempt from canopy caps, presenting another wrinkle or opportunity within the overall regulatory framework.

Although the outline has been set regarding cultivation, mezzo and micro licenses, uncertainty remains regarding the license lottery system. This uncertainty was also exacerbated by the issues surrounding whether, and how, Minnesota would allow early cultivation. Some cultivators raised concerns over what might happen if they are able to begin early cultivation but then lose out on the later license lottery. Others worried that if they do not begin cultivating early, they could forfeit additional points that could have secured them a license. Disruptions to the point-based allocation mechanism also raise pertinent questions regarding fairness and transparency through the licensing process. Addressing apprehensions surrounding straw applicants and ownership transparency is paramount to fostering trust and accountability within the OCM and its regulatory framework. It’s promising to see Minnesota legislators and regulatory agencies working in conjunction to address these issues early in hopes of fostering a robust market.

Leadership is critical for Minnesota cannabis program success

Establishing a flourishing cannabis market will require a form of early cultivation and production to ensure retailers are stocked with products to sell at launch and both the Legislature and the OCM are aware of that fact and working towards addressing these issues. The OCM’s leadership and decision-making on these issues have the potential to reshape and drive the trajectory of Minnesota’s legal cannabis market as we approach the much-anticipated retail launch in early spring of 2025. As Minnesota moves towards that launch, the discourse surrounding early cultivation serves as a litmus test for regulatory agility and stakeholder collaboration. By navigating the complexities of licensing, and regulatory concerns, and addressing the imperative early cultivation period, Minnesota is poised to address many tough questions and policy dilemmas before a single seed is sown or a single flower is sold under the new legal cannabis market.



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What Rescheduling Marijuana Means for California’s Cannabis Industry

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California‘s cannabis industry suffers from a seemingly unending list of problems: high taxes, prohibitionist cities, a related lack of retail licenses and oversupply of non-retail licenses, a monster illegal market with no end in sight, burdensome and often senseless regulations, and so on. Unfortunately, rescheduling won’t solve most of these problems–at least not directly. Today I want to look at what rescheduling could mean for California’s cannabis industry.

If you’re not already up to speed on rescheduling, check out my colleague Vince Sliwoski’s explainer of the DEA’s notice of proposed rulemaking to move marijuana from schedule I (where it sits next to heroin) to schedule III, or any of the following posts of ours:

With that out of the way, let’s look how rescheduling could affect (or not affect) California’s cannabis industry.

First and foremost, rescheduling does not mean that state-legal cannabis markets will be federally compliant. In other words, all California cannabis businesses will still violate federal law. The biggest change would be that  IRC § 280E – which prohibits cannabis businesses from making standard federal tax deductions – will go away. But the statewide cannabis industry won’t be federally “legal.”

What that means is that rescheduling will have no impact on things like the prohibition on interstate commerce, which has kept California walled off from other states (at least California’s legal market). So for now, California’s still on its own.

Rescheduling also won’t impact state law where it counts. Things like local control, burdensome regulations, fighting the illegal market, and so on, will stay the same. Importantly, local and state tax law won’t change: California and many local cities tax cannabis businesses as if they are piggybanks. While 280E relief will undoubtedly help, it makes it much less likely that the state will revisit its own excise tax or think about how it could cap local gross receipts taxes.

So with all that out of the way, is there any good news? I think the answer is a clear yes. Here’s why:

  • Even without state and local tax relief, 280E relief alone will be a monumental change for the industry.
  • Investments into California’s cannabis industry are likely to increase as investors who previously stood on the sidelines become more comfortable with the idea of investing into a (slightly) less regulated industry.
  • Other ancillary service providers may also be more open to providing services to the industry for similar reasons. More ancillary service providers may reduce costs within the cannabis industry.
  • It’s possible that state governments also decide to be more bold. For example, states could decide to roll the dice on interstate commerce compacts after rescheduling, even in spite of schedule III issues.
  • Although the impact on the illegal market will likely be small, the removal of 280E liabilities could entice people who would otherwise have remained unlicensed to become legal and complaint operators.

We’ve got a long way to go before rescheduling happens. And while nobody can really say for sure how things will shake out, it seems like there are some definite positive outcomes for California’s cannabis industry. So stay tuned for more updates.



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The End of the US Hemp Industry is Near

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The 2018 Farm Bill legalized the cultivation of hemp, distinguishing it from marijuana based on its low THC content. However, an emerging loophole has allowed the proliferation of psychoactive hemp-derived products, particularly delta-8 THC, which has led to significant regulatory and public health concerns. In response, a proposed amendment to the Farm Bill seeks to address these issues by banning hemp-derived cannabinoid products, including delta-8 THC. This proposed amendment, filed by Rep. Mary Miller (R-IL), aims to redefine hemp and close the existing loophole around intoxicating hemp. The amendment has sparked a heated debate among industry stakeholders, regulators, and lawmakers.

If you have followed the legal hemp market over the past 8 years and attended shows like the Benzinga Cannabis Conference, you know that the only thing keeping the US hemp industry alive, and on life-support at best, is the sale of commerical retail products that create revenue, ie, Delta-8 THC and Delta-9 THC products derived from hemp.  While hemp-crete and hemp twine are nice stories, the only “cash crop” hemp has right now is selling “hemp that gets you high” to Americans that don’t have acccess to legal weed.

As mentioned by a few VCs and investment firms at the industry trade shows, the only think keeping hemp alive in America is Delta-8 and Delta-9 THC products and sales.

That “loophole” in the original 2018 Farm Bill may be closing, and for good, with a new amendment put forward this week.

 

 Key Provisions of the Proposed Amendment

The amendment includes several critical provisions designed to tighten regulations on hemp-derived products:

  • Redefinition of Hemp: Redefines hemp to exclude products containing detectable levels of THC and cannabinoids synthesized outside the plant.

  • Ban on Delta-8 THC: Explicitly bans hemp-derived products that contain psychoactive cannabinoids, such as delta-8 THC.

  • Enhanced Regulatory Oversight: Aims to provide clearer guidelines and stricter controls over the production and sale of hemp-derived products.

 Concerns Leading to the Amendment

Proponents of the amendment argue that the current lack of regulation has led to several issues:

  • Marketing to Children and Teens: Psychoactive hemp products are often marketed in colorful packaging, resembling candy and snacks, raising concerns about their appeal to children and teenagers.

  • Unregulated Market: The proliferation of hemp-derived cannabinoids has resulted in an unregulated market where the safety and quality of products are inconsistent.

  • Public Health Risks: There are concerns about the potential health risks associated with the unregulated sale and consumption of these products.

 Industry Opposition and Concerns

Industry stakeholders and advocates for the hemp industry have voiced strong opposition to the proposed amendment. Their main arguments include:

  • Impact on CBD Products: The amendment could criminalize many non-intoxicating CBD products that naturally contain trace amounts of THC.

  • Economic Consequences: The ban could devastate the hemp industry, resulting in significant job losses and economic decline.

  • Access to Health Products: Many Americans rely on hemp-derived products for health and wellness, and the ban could deny them access to these beneficial products.

 Economic Implications

The hemp market is currently valued at approximately $28 billion, with a significant portion of this market driven by hemp-derived cannabinoid products. The proposed amendment could have profound economic implications, including:

  • Job Losses: Potential loss of tens of thousands of jobs in agriculture, retail, and manufacturing sectors.

  • Market Decline: A potential decline in sales and overall market value as many products would no longer be legally available.

  • Investment Uncertainty: Increased regulatory uncertainty could deter future investments in the hemp industry.

Regulatory Challenges

The hemp industry has faced numerous regulatory challenges since the legalization of hemp in 2018. Key regulatory hurdles include:

Lack of FDA Regulation: The FDA has yet to establish clear regulations for hemp-derived CBD products, creating a patchwork of state-level regulations and contributing to market instability.

  • Safety and Quality Standards: The absence of federal guidelines has led to inconsistent safety and quality standards across the industry.

  • Youth Access: The unregulated sale of psychoactive hemp products has raised concerns about youth access and potential misuse.

Legislative Process and Potential Outcomes

The amendment’s approval by the House Agriculture Committee is the first step in a potentially contentious legislative process. The Senate, which has yet to release its version of the Farm Bill, will play a crucial role in determining the amendment’s fate. Key considerations include:

  • Senate’s Stance: The Democratic-controlled Senate may take a different approach to the regulation of hemp-derived cannabinoids, potentially leading to a conflict between the two chambers.

  • Bipartisan Negotiations: Successful passage of the amendment will likely require bipartisan support and negotiations to reconcile differing viewpoints.

  • Final Legislation: The final version of the Farm Bill will need to balance the interests of public health, industry stakeholders, and regulatory clarity.

Broader Implications for Cannabinoid Regulation

The proposed amendment raises broader questions about the regulation of cannabinoids in general:

  • Defining Cannabinoids: The amendment’s language excluding detectable levels of THC and synthesized cannabinoids could impact the regulation of other cannabinoids, such as CBD.

  • Regulatory Parity: Proponents argue that the amendment would create regulatory parity and facilitate state-level regulation of intoxicating hemp products.

  • Future of Cannabinoid Products: The regulation of cannabinoids will continue to evolve, with ongoing debates about the safety, efficacy, and legality of various products.

 Public Health Considerations

The shift towards greater regulation of hemp-derived cannabinoids has significant public health implications:

  • Consumer Safety: Enhanced regulatory oversight could improve consumer safety by ensuring that hemp-derived products meet consistent quality and safety standards.

  • Health Risks: The unregulated sale of psychoactive hemp products poses potential health risks, particularly for vulnerable populations.

  • Research and Education: Increased research and public education efforts are needed to fully understand the health impacts of hemp-derived cannabinoids and inform regulatory policies.

Industry Adaptation and Future Outlook

The hemp industry will need to adapt to the proposed regulatory changes if the amendment is enacted. Key strategies for adaptation include:

  • Compliance and Certification: Producers and manufacturers will need to invest in compliance and certification processes to meet new regulatory standards.

  • Product Innovation: The industry may shift focus towards non-psychoactive hemp applications and develop new products that comply with stricter regulations.

  • Advocacy and Engagement: Ongoing advocacy and engagement with policymakers will be essential to ensure that the industry’s interests are represented in regulatory discussions.

 Conclusion

The proposed Farm Bill amendment to ban hemp-derived cannabinoid products represents a significant shift in U.S. agricultural and regulatory policy. While proponents argue that it addresses critical public health and safety concerns, industry stakeholders warn of devastating economic consequences and the potential loss of beneficial products. As the amendment moves through the legislative process, the hemp industry faces a period of uncertainty and adaptation. The outcome of this debate will shape the future of hemp regulation, balancing the need for consumer protection with the growth and innovation of a burgeoning industry.

 

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Just Say No to Pesticides on Your Weed

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How To Prevent Pests In Your Homegrown Cannabis Plants Without Using Harmful Chemicals

 

Just like every other plant, cannabis plants will also attract its fair share of pests and bugs when you try to grow them at home. Even professional cannabis growers have to deal with pests!


Pests come in the form of insects, fungus, mites, and bacteria. For homegrown marijuana, the most common offenders include aphids, thrips, spider mites, botrytis, cabbage loopers, whiteflies, powdery mildew, fungus gnats, and root aphids. When they go on undetected or without any treatment, they can cause a wide array of damage to your precious cannabis plant.

 

The worst-case scenario is that your plant can end up being so unhealthy and damaged, that you might even have to end up throwing it away before you can harvest anything. Sometimes, the pest problem can hide itself so effectively that you won’t even know it’s there until you’ve harvested your weed, and are opening your buds apart to smoke. Then, it would be far too late to do anything!

 

Many weed growers end up resorting to strong, harmful chemical pesticides and fungicides to prevent pest problems or nip them in the bud. However, these chemical pesticides and fungicides can also be dangerous for humans and the environment. They are, after all, made with chemicals – and some of these chemicals are known to be carcinogenic.

 

But don’t worry: there are several other ways cannabis home growers can deal with pests without harmful chemicals and strong pesticides.

 

Prevention Is Key

 

Truly understanding your home grow setup and operation is the first and most important step to preventing pests. This can take some time and resources in the beginning, but it will save you time and money in the long run!

There are certain factors involved with specific grow setups as well as environments. For example, when growing marijuana outdoors, the most common pests to deal with include aphids, Eurasian hemp borers, corn earworms, and hemp russet mites among others. You’ll also have to learn to prevent squirrels, deer, raccoons, and other bigger animals since humans aren’t the only ones that are attracted to weed!

 

Meanwhile, there’s a different set of beasts to deal with indoors because other factors are involved. These include humidity, ventilation, and air circulation. But regardless of whether you are growing indoors or outdoors, keep in mind that soil plays a critical role in preventing pests. Many growers have found success in using beneficial nematodes, which are microscopic and thus invisible roundworms that eat pests that thrive in soil. Nematodes are excellent for eliminating root aphids and fungus gnats; you can drench the soil in it or mix it up in water before irrigation.

 

Companion Planting

 

Companion planting is a common and widely practiced technique in farming as well as gardening. You can apply the principles of companion planting for cannabis cultivation; it entails planting certain plants or herbs next to cannabis which are known to create a symbiotic or beneficial environment. For example, certain plants or vegetables are known to equally feed off water, while other plants consume more water and thus leave their companion plants thirsty.

 

Meanwhile, some companion plants are effective in helping repel insects and diseases, which is why they are favored among cannabis growers. When it comes to companion planting, some plants to consider include marigolds, lavender, basil, and nasturtiums.

 

Beneficial Insects

 

Believe it or not, some insects can actually be good for your cannabis harvest. Lacewings and ladybugs are two of the most valuable types of insects for cannabis growers, especially if you are growing outside.

To ensure an abundant population, you can purchase beneficial insects and let them roam free in your greenhouse or grow area. They are fantastic for all kinds of plants, not just marijuana. Ladybugs and lacewings are particularly effective because they feed on spider mites, whiteflies, mealybugs, and other soft-bodied pests as well as larvae.

 

Organic Pesticides

 

There are several different kinds of effective organic pesticides and fungicides in the market, too. You can use them as a complement to other pest-prevention techniques that you are already doing. Adding organic pesticides to cannabis crop care and maintenance can help greatly deter pests especially if you find that other techniques are lacking or not working as well.


Organic pesticides come in the form of neem oil, insecticidal soap, and botanical sprays. Neem oil is a top choice when it comes to organic pest control, even among household plants! Keep in mind to use neem oil only during the vegetative growth cycle of marijuana.

 

 Just dilute two teaspoons of neem essential oil into a gallon of water, then spray. Or, you can also buy ready-to-use neem spray. Neem oil can be sprayed directly on the foliage, or you can also drench the soil in neem oil no matter what stage of growth your cannabis plant is in. It’s extremely effective in killing and preventing cannabis pests including leafhoppers, crickets, aphids, mealybugs, and so much more.

 

If you’re going to end up using foliar sprays, it’s important to buy the best-quality organic, natural sprays that you can afford. That’s because any ingredients used in those sprays are going to end up in the cannabis flower, which means that you’re going to end up smoking it. When it comes to the best time to use foliar spray on cannabis, it’s during the flowering cycle because it can help keep cabbage loopers and other pests off during this phase.


Conclusion

 

There are many creative ways you can get rid of pests effectively, whether you are growing cannabis indoors or outdoors. Follow these tips to ensure a healthy harvest without compromising your health or that of the environment – there’s no need to use nasty and highly toxic chemical sprays

 

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