Cannabis Investors Are Zoning Out About Supply – Wall Street Journal

By Carol Ryan Carol Ryan The Wall Street Journal Biography June 27, 2019 5:11 am ET

It is wise to know where your cannabis comes from. Intoxicated by bullish demand forecasts, pot investors aren’t paying nearly enough attention to supply.

U.S. states currently decide whether to legalize cannabis within their own borders, even though the drug remains illegal at the federal level. It is a misnomer to speak of a single U.S. pot industry, considering the patchwork of self-contained cannabis economies across the country.

Pot can’t cross state lines today, even between two states where the drug is allowed. Should federal laws change, high-cost growers and areas with less favorable climates for cannabis growing will be undercut.

Pollen is removed from a hemp plant at a facility in Springfield, Ore. Photo: Don Ryan/Associated Press

“There will be upheaval in the price structure and efficiencies are going to set in,” said Steve Schain, senior counsel at cannabis law firm Hoban Law Group.

Oregon is ready to roll. This week, lawmakers in the West-coast state signed into law a new bill that would allow local cannabis growers to export over its borders if and when federal law permits. This oversupplied state could quickly flood the market with cheap crop.

When adult use was legalized in Oregon four years ago, too many growing licenses were issued. That has led to excess inventory—6.5

Read More Here...

Leave a Comment

Please Rate This Content*

Your email address will not be published. Required fields are marked *

Scroll to Top