Cannabis commercialization question

[Thomas]

Large scale? 2400 square feet is a 40 foot by 60 foot pole barn. That's about a sixteenth of an acre, a quarter of a small urban residential lot. It would take a kid with a push mower less than a half hour to mow it. As far as agricultural production goes, you wouldn't grow 5 apple trees in that tiny space. You might get a couple of dozen cantaloupes out of it, or three bushels of tomatoes, or maybe one cow. Large scale?

Right-right.. It's a very compact plant But of course, I have seen documentaries about people living as growers quite well (i.e. primary caregivers), I just can't find additional documentation on the internet right now.

There are some pictures of large scale operations at the end of this video, http://www.msnbc.msn.com/id/28354324/ns/business-cnbc_tv/ - and a chit-chat about the marijuana business.

Large scale illegal operations take place too.

But are you seriously denying that legalization wouldn't reduce the cost of production significantly?


Do you think all of that risk and secrecy doesn't have a huge cost? I would consider growing marijuana and selling it, were the risks of imprisonment and violence not so high.

You don't think farmers all across the U.S. would start growing it if it were legal? You don't think an increase in supply, and a decrease in cost of production would lower the price?

Perhaps, only a possible future can show if taxed marijuana will become cheaper than black market goods. If farmers and/or the govt. et al can keep it on the same price, then they will.

It's plausible that it would fall in price a tad. It had fallen a dollar in the area I posted a link to above, just for medical marijuana, not completely legalized weed.

 

[Marduk]

Skunk made with artificial lights is usually much stronger than "field weed".

according to the ex uk Prime Minister its actually deadly

"I think people know my view about cannabis and particularly about this lethal version of it, skunk."

so yanno, I prefer it illegal really, I can buy it if I so wish from a neighbour who lives on my street corner 30 seconds walk away, if they legalise it I'd have to go as far as the local shops which is at least 1/8 mile further away, obviously I'd probably go there after I'd smoked it to buy crisps, chocolate and peanuts anyway but thats a whole nother story

 

[Aepervius]

Also don't forget that *medical* marijuana has almost certainly to go under stricter control than recreational marijuana.

There are a lot of medical equipement, which cost nothing if not used in medical circumstance, but are sold their weight in gold once for usage in hospital, if only because of liability protection.

Medical marijuana before and after legalisation would almost certainly stay at a high price. Recreational marijuana almost certainly would stabilize at another price, depending what the market would bear. I guess lower (no risk of arrest, mass production, marketing, basic control being the same as for cigarette or similar level, and a lot of people suddenly becoming grower at the start of the legalisation).

 

[GeeMack]

Right-right.. It's a very compact plant But of course, I have seen documentaries about people living as growers quite well (i.e. primary caregivers), I just can't find additional documentation on the internet right now.

But they aren't going to be living as growers when the stuff costs a few bucks an ounce instead of a couple hundred bucks. The businesses that are already set up as agricultural operations will be growing it by the ton for pennies a pound. Even if taxation adds several hundred percent it will still be cheap compared to today's underground market. And if it's not cheap enough...

The people who don't want to buy it at prices competitive to herbs, spices, tobacco, and alcohol will grow a couple of plants in their own basements or backyards because they won't be risking having their property confiscated. It'll cost them close to nothing but an hour or two a week to tend and harvest. And those people will supply themselves and a couple of pals. Since it's as easy to grow as tomatoes...

The laws of open economics will prevail when the laws of prohibition economics don't play a part. There will be no black market in marijuana at all, unless you consider a few pals buying and selling a few ounces from/to each other for the equivalent of beer money. There will be no possible way black market reefer could compete with no-risk home grown and commercial/industrial agriculture, marketing, and distribution.

 

[Thomas]

But they aren't going to be living as growers when the stuff costs a few bucks an ounce instead of a couple hundred bucks. The businesses that are already set up as agricultural operations will be growing it by the ton for pennies a pound. Even if taxation adds several hundred percent it will still be cheap compared to today's underground market. And if it's not cheap enough...

The people who don't want to buy it at prices competitive to herbs, spices, tobacco, and alcohol will grow a couple of plants in their own basements or backyards because they won't be risking having their property confiscated. It'll cost them close to nothing but an hour or two a week to tend and harvest. And those people will supply themselves and a couple of pals. Since it's as easy to grow as tomatoes...

That depends on whether you have a backyard that is safe from thieves, because if you want to run it as an indoor operation, then you will have a severely rasied power bill. It's expensive to run strong lights 24/7 to make hydroponics.

The laws of open economics will prevail when the laws of prohibition economics don't play a part. There will be no black market in marijuana at all, unless you consider a few pals buying and selling a few ounces from/to each other for the equivalent of beer money. There will be no possible way black market reefer could compete with no-risk home grown and commercial/industrial agriculture, marketing, and distribution.

Tax,- & tollfree weed would still be superior in price to that of taxed weed, so there would still be an opening for a black market. Just like with cigarettes.

 

[jmcvann]

Not only would such a law remove large swaths of prisoners - it would be removing prisoners less prone to violence, making the prisons a more dangerous place for guards.

Huh? The guards would have fewer people to watch over. Unless you think the violent prisoners would become more violent, how would this make the situation more dangerous for the guards? Perhaps you are thinking that every non-violent drug offender would be replaced by a more violent person. Even if that were the case, I don't think it's a good argument against legalization.

 

[GeeMack]

That depends on whether you have a backyard that is safe from thieves, because if you want to run it as an indoor operation, then you will have a severely rasied power bill. It's expensive to run strong lights 24/7 to make hydroponics.

Of course you could grow it on your sun porch. And even with a personal hydroponics set-up it would still be radically cheaper than it is now.

Tax,- & tollfree weed would still be superior in price to that of taxed weed, so there would still be an opening for a black market. Just like with cigarettes.

So?

 

[Thomas]

Of course you could grow it on your sun porch. And even with a personal hydroponics set-up it would still be radically cheaper than it is now.

It's not likely that power will become any cheaper tho, so while hemp, that only few people with limited access smoke due to low THC content, may become much cheaper, then you still have hydroponics and general indoor cultivation as something unique with a high THC potency that people will continue to buy. Something that is mostly price dictated from the manufactorers power bill. A 420W bulb will remain a 420W bulb.

So?

So, you were off-track when you said that "There will be no possible way black market reefer could compete with no-risk home grown and commercial/industrial agriculture, marketing, and distribution"- of course there will be a way, taxfree marijuana, and perhaps even tollfree if smuggled in from abroad as some sort of popular brand.

 

[WildCat]

You missed the major point, which is the economy of scale. It is still illegal in the USA to grow marijuana. If it becomes legal and corporations are confident they can make the required infrastructure investments and not worry about it being made illegal again before they can recoup their startup costs, they will be able grow it orders of magnitude more efficiently. It's not going to be grown in some guy's basement with everything done by hand.

Granted, tobacco is not the same as marijuana, but the fact is they can do it legally with all the associated costs (tractors, drying houses, machinery, distribution, wages, insurance, etc) and sell loose tobacco for pennies per gram. Are you seriously arguing that once big corporations get involved it will still cost 100X as much as tobacco?



How is that relevant? The fact is that in the few places you can grow it, production is severly limited. If they open up the USA market and allow large scale production, technology will make it much less expensive to produce.

I don't see big corporations getting involved at all. It's not like cigarettes, whose smokers consume 20 grams a day. In one of these other threads I calculated that the entire US marijuana demand could be grown on 1,500 acres or so, or 3 average-sized farms. Obviously, oversupply would be an issue. I doubt any farmers woulod grow it unless contracted to, like other niche agricultural products (think spices).

 

[BenBurch]

The only way to find out for sure is to legalize it.

I suspect that "medicinal use" would mostly disappear if recreational use was allowed, just as "medicinal use" of liquor mostly disappeared once prohibition was ended.

Well, I suspect that chemo patients would still seek it out, but they might not bother getting a prescription.

 

[BenBurch]

I don't see big corporations getting involved at all. It's not like cigarettes, whose smokers consume 20 grams a day. In one of these other threads I calculated that the entire US marijuana demand could be grown on 1,500 acres or so, or 3 average-sized farms. Obviously, oversupply would be an issue. I doubt any farmers woulod grow it unless contracted to, like other niche agricultural products (think spices).

My prediction;

First two or three years after legalization there will be tens of thousands of small businesses started to get rich on it. And then it will be very hard to find for a year or so because almost every single one of those growers will have bankrupted. Eventually market forces will work and supply and demand will seek a natural level.

Mr. Randi's million is gonna be MINE. Bwahaha!

 

[DC]

My prediction;

First two or three years after legalization there will be tens of thousands of small businesses started to get rich on it. And then it will be very hard to find for a year or so because almost every single one of those growers will have bankrupted. Eventually market forces will work and supply and demand will seek a natural level.

Mr. Randi's million is gonna be MINE. Bwahaha!

good prediction i think

we had similar situation in Basel, when they used a grey zone of the law and sold "Duftsäckli" (flavor bags). For a while we had more Hemp-shops than Bakeries. which then got reduced quickly as the not so good shops closed its doors.

well until they set an end to it after a lot of Germans and French came shopping here.

 

[Thomas]

I don't see big corporations getting involved at all. It's not like cigarettes, whose smokers consume 20 grams a day. In one of these other threads I calculated that the entire US marijuana demand could be grown on 1,500 acres or so, or 3 average-sized farms. Obviously, oversupply would be an issue. I doubt any farmers woulod grow it unless contracted to, like other niche agricultural products (think spices).

I live right next to a hashish and skunk supermarket called Christiania, and I see a very low demand for (the cheap - low THC level) outdoors marijuana. So what about the majority who smokes hash or hydro once it's legalized?

 

[GeeMack]

It's not likely that power will become any cheaper tho, so while hemp, that only few people with limited access smoke due to low THC content, may become much cheaper, then you still have hydroponics and general indoor cultivation as something unique with a high THC potency that people will continue to buy. Something that is mostly price dictated from the manufactorers power bill. A 420W bulb will remain a 420W bulb.

Apparently you have a poor understanding of what it takes to grow a personal use quantity of very good quality marijuana.

So, you were off-track when you said that "There will be no possible way black market reefer could compete with no-risk home grown and commercial/industrial agriculture, marketing, and distribution"- of course there will be a way, taxfree marijuana, and perhaps even tollfree if smuggled in from abroad as some sort of popular brand.

For the most part smuggled marijuana, quality for quality, can't compete in price with the marijuana I might grow on my sun porch or in my basement. Surely the odd situation would occur where a warehouse shipment gets stolen making the cost to the distributor next to nothing. Also some might buy it in one state and sell it in another where the tax rate is higher, allowing for a small profit margin. But generally speaking, bootleggers couldn't compete with the prices most of my pot smoking acquaintances have been paying for the last 20 or 30 years unless the bootleggers were getting it almost free.

Where I live there isn't a national border for several hundred miles in any direction. It would cost the black marketeers more in gas to haul the stuff here than it would cost me to grow it. Hell, that's pretty much already the case. Probably over half of the marijuana in my area is grown within a hundred miles of here. There are a couple billion acres of land in the United States and a hundred million houses with porches, garages, basements, and fenced in yards. When people aren't risking having their property confiscated by the government for growing a few plants, excellent quality home grown product is likely to become ubiquitous.

 

[kevinquinnyo]

Apparently you have a poor understanding of what it takes to grow a personal use quantity of very good quality marijuana.




For the most part smuggled marijuana, quality for quality, can't compete in price with the marijuana I might grow on my sun porch or in my basement. Surely the odd situation would occur where a warehouse shipment gets stolen making the cost to the distributor next to nothing. Also some might buy it in one state and sell it in another where the tax rate is higher, allowing for a small profit margin. But generally speaking, bootleggers couldn't compete with the prices most of my pot smoking acquaintances have been paying for the last 20 or 30 years unless the bootleggers were getting it almost free.

Where I live there isn't a national border for several hundred miles in any direction. It would cost the black marketeers more in gas to haul the stuff here than it would cost me to grow it. Hell, that's pretty much already the case. Probably over half of the marijuana in my area is grown within a hundred miles of here. There are a couple billion acres of land in the United States and a hundred million houses with porches, garages, basements, and fenced in yards. When people aren't risking having their property confiscated by the government for growing a few plants, excellent quality home grown product is likely to become ubiquitous.

What evidence do you have to support the highlighted statement?

It's not easy or practical for the end-user to know where the marijuana he or she is smoking came from. In fact, just trying to find out where your dealer gets it from is asking for trouble. You will either scare the dealer away, or he will think you are trying to go directly to the other guy and cut into his market.



If bananas were illegal, I still wouldn't assume they were grown 200 miles from me (S.E. United States). That's because it would be very expensive to grow them where I live, and cheaper to grow a lot in the perfect climate, and then transport them all over the world.

Are you saying you think this is the case, because marijuana is hardier in a variety of climates, unlike say, bananas, or tomatoes?

 

[WildCat]

Ineffecient, but it results in a different crop than you can breed outdoors. Skunk made with artificial lights is usually much stronger than "field weed" like Mexican or Bolivian, due to various properties.. Weed grown outside is half the price of skunk here in Denmark, and also about half as strong. You can rest assure that legalization won't stop the indoor production of skunk. Just look at Holland.

You're comparing apples and oranges. Take the same seed stock, grow some outdoors in soil and some indoors hydroponically and and the outdoor marijuana will have a higher yield, just as much if not more potency, and superior taste.

The difference between skunk and your "field weed" is genetic, not where it was grown.

 

[WildCat]

Time Magazine (as of 03/09) said cannabis came in at $14 billion per year in California:

http://www.time.com/time/nation/article/0,8599,1884956,00.html

If cannabis were federally legalized, the total revenue wouldn't be 50 times $14 billion -- because not all states are California-sized -- but you can imagine that the total revenue figure would be in the hundreds of billions.

No, the price would plummet and there would be an glut from oversupply as everyone wants to grow a $2,000 plant. There is no way it could even hold 1/20 the price if it were legal.

 

[WildCat]

Well, these are not tomatoes, so as you indicate yourself, then you have hydroponics as the strongest crop in regard to THC levels when advanced measures are taken of course.. As noted in this article..

"Indoors, high-powered lights that stimulate growth can remain on all day, their nourishing rays reflected off the metallic-coated paper covering walls. The chemical fertilizers used are just as powerful and nourishing, spawning fast-growing plants that produce more THC than those raised outdoors."

Read more: http://www.time.com/time/nation/article/0,8599,1913401,00.html#ixzz0qenAhfzr

Keeping the lights on 24/7 merely allows the plant to grow larger faster, it does nothing for the potency. In fact, marijuana won't flower at all (and it's the flowers you smoke) if the lights are kept on 24/7, to induce them to flower you have to cut back the light to 12 hours a day. And you can use fertilizer outdoors as well.

What you cannot do with lights is match the brightness of the sun, and hydroponics will never contain the same trace minerals as soil does which will affect taste.

The comparison to a hothouse tomato is apt.

I'll also add that lighting is expensive, and I don't see any way such expense could be justified if it was legalized and the price collapses to a tiny fraction of what it is now. And the price would definitely collapse.

 

[DC]

Keeping the lights on 24/7 merely allows the plant to grow larger faster, it does nothing for the potency. In fact, marijuana won't flower at all (and it's the flowers you smoke) if the lights are kept on 24/7, to induce them to flower you have to cut back the light to 12 hours a day. And you can use fertilizer outdoors as well.

What you cannot do with lights is match the brightness of the sun, and hydroponics will never contain the same trace minerals as soil does which will affect taste.

The comparison to a hothouse tomato is apt.

I'll also add that lighting is expensive, and I don't see any way such expense could be justified if it was legalized and the price collapses to a tiny fraction of what it is now. And the price would definitely collapse.

awaik what makes indoor stronger is the temperature control. something above 25° C i think, natural temperatures slow growth speed and THC production.

 

[GeeMack]

What evidence do you have to support the highlighted statement?

My primary evidence is anecdotal. Business and hobbies have kept me in tangent contact with the marijuana culture in this area for the past 40 years, so I have a pretty fair understanding of the supply chain from the guys with the little greenhouses (and more) all the way to the end users. Marijuana is Illinois's third largest cash crop. Now obviously there's a huge difference when comparing dollars per acre against the 12 million acres of corn and 9 million acres of soybeans, but there is $270 million worth of marijuana grown each year in this state.

It's not easy or practical for the end-user to know where the marijuana he or she is smoking came from. In fact, just trying to find out where your dealer gets it from is asking for trouble. You will either scare the dealer away, or he will think you are trying to go directly to the other guy and cut into his market.

I'm very familiar with the economic dynamics and secrecy involved in black market marijuana, and you are correct in that it's generally not easy to know the source, but it's not impossible. And the longer one has contact with people in the culture, the more data one has and the easier it is to assemble it into a reasonable sampling.

If bananas were illegal, I still wouldn't assume they were grown 200 miles from me (S.E. United States). That's because it would be very expensive to grow them where I live, and cheaper to grow a lot in the perfect climate, and then transport them all over the world.

Are you saying you think this is the case, because marijuana is hardier in a variety of climates, unlike say, bananas, or tomatoes?

Yes, part of what I'm saying is that marijuana can/will grow anywhere. Arguably some of the best grows outdoors in Alaska. My area of the Midwest is one of the most prolific agricultural regions on the planet and marijuana literally grows like a weed here. From Florida to Minnesota, from North Carolina to California, there isn't a part of this continent that won't support at least a decent crop, even growing outdoors.

And although there might be some shipping of Florida reefer to Kentucky, and Kentucky reefer to Utah, and Utah reefer to Maine, etc., the laws of economics and general practicality would suggest that since it can be grown anywhere, most of it isn't going to end up terribly far from where it's produced. It's not like tomatoes with a limited growing season in limited regions. Even in areas where the growing season is an issue, a year's supply can be grown in the good season and stored in a coffee can in the refrigerator. Spoilage is barely a concern if one applies just a bit of care.