THE NEXT SUPPLY AND DEMAND ROLLER COASTER?

BY ADAM JACQUES

THIS TIME WE are going to talk about something that I am insanely passionate about: the cannabinoid know as CBD or Cannabidiol. CBD has entered the mainstream media and marketplace with a fervor spurred on by countless news stories, multiple law changes, and its proven ability to help in numerous medical capacities. Years ago, when I started down the road of my intense research in CBD, there was very little in the public space about this topic.

Now, there is a plethora of information both good and bad. I will attempt to disseminate some common myths and misconceptions, and, along with a few other experts in the field, bring to light a little bit of what this market is,what it’s capable of, and some basics on its use.

HEMP VS. CANNABIS: THE HEATED DEBATE

If you look online long enough for CBD information, you will find someone saying that hemp is different from cannabis. Other than its intended uses at harvest, what, if anything, makes hemp different from cannabis? While I have my own truths on the subject, I asked prolific CBD breeder, medical cannabis grower, and large scale hemp grower, Two, for his input on this matter. Two explains: “Traditionally “Hemp” refers to a more fiber-leaning, taller plant that has thousands of uses from fabric to plastic to bio fuel and more. Traditional “marijuana” is a drug-type variety, bred for THC, yield, flavors, and other cannabinoids. The only real difference between hemp and cannabis today though, is the THC level. With the high-CBD, low-THC plants that have just recently been discovered and bred with, we’re seeing more of a drug-variety-shaped “hemp” plant. As more people breed these plants under .3-percent THC, I think we’ll start to see a larger variation of plant structure, cannabinoid and terpene profile.

Successfully breeding strains for use in the hemp and cannabis markets was, and continues to be for some, a tricky nut to crack. Being able to say beyond a shadow of a doubt the strain you are creating is 100% CBD dominant and falls in to a certain window of ratios used to be near impossible. With many cannabis-specific testing labs now opened and breeders focusing directly on cannabinoids other than THC, we have entered a golden age for unique varieties of cannabis. New varieties of CBD-rich cannabis hit the market with regularity presently, from non-detectable THC strains with high percentages of CBD, to one-to-one CBD to THC strains, and every stop in between.

Also, these strains, which used to be locked in a common category of terpenes, now come in a multitude of “flavors,” While some CBD genetics are still difficult to obtain on the public market, in breeders’ circles, it is well known who has what and who can make what you want. A vast market is opening up thanks to strains becoming available for breeders to use that bestow CBD

HEMP VS. CANNABIS: THE HEATED DEBATE

If you look online long enough for CBD information, you will find someone saying that hemp is different from cannabis. Other than its intended uses at harvest, what, if anything, makes hemp different from cannabis? While I have my own truths on the subject, I asked prolific CBD breeder, medical cannabis grower, and large scale hemp grower, Two, for his input on this matter. Two explains: “Traditionally “Hemp” refers to a more fiber-leaning, taller plant that has thousands of uses from fabric to plastic to bio fuel and more. Traditional “marijuana” is a drug-type variety, bred for THC, yield, flavors, and other cannabinoids. The only real difference between hemp and cannabis today though, is the THC level. With the high-CBD, low-THC plants that have just recently been discovered and bred with, we’re seeing more of a drug-variety-shaped “hemp” plant. As more people breed these plants under .3-percent THC, I think we’ll start to see a larger variation of plant structure, cannabinoid and terpene profile.

Successfully breeding strains for use in the hemp and cannabis markets was, and continues to be for some, a tricky nut to crack. Being able to say beyond a shadow of a doubt the strain you are creating is 100% CBD dominant and falls in to a certain window of ratios used to be near impossible. With many cannabis-specific testing labs now opened and breeders focusing directly on cannabinoids other than THC, we have entered a golden age for unique varieties of cannabis. New varieties of CBD-rich cannabis hit the market with regularity presently, from non-detectable THC strains with high percentages of CBD, to one-to-one CBD to THC strains, and every stop in between.

Also, these strains, which used to be locked in a common category of terpenes, now come in a multitude of “flavors,” While some CBD genetics are still difficult to obtain on the public market, in breeders’ circles, it is well known who has what and who can make what you want. A vast market is opening up thanks to strains becoming available for breeders to use that bestow CBD dominance to genetics. Products made from CBD and other cannabanoids are now being searched out by a market normally untapped by the cannabis community and the demand is high. This has created a seed market to match.

When asked about the CBD market, storied breeder and grower, Raymond Bowser, III, otherwise known as Odie Diesel of Home Grown Natural Wonders, says, “I’ve watched the CBD market explode in the past few years. Working trade shows for the last seven years, I’ve seen it go from almost no one selling CBD to several CBD-only breeders, and most seed companies now offer CBD strains-rich crosses. Even we have some on the market. As research continues and we learn more how medicinally beneficial it is, I feel the market will grow.”

“It seems that one-to-one and two-to-one are the most popular with folks for home grows. I feel those are where people look for pain relief in the beginning,” Odie explained about the market share on CBD-rich genetics and which ones seem to be the most sough after. “There are those looking for the three-to-one to 10-to-one ratios that don’t want to feel the effects of THC at all. Then you have the hemp farmer looking for 20-to-one and fifty-to-one ratios so they can stay within the federal guidelines of less than .3-percent THC. The hemp market will be huge due to the acreage of hemp compared to the square foot of recreational.”

Odie remarked how the landscape has changed over the past year. “Over the past year people are wanting different terps from the classics cherry taste,” Odie says. “More breeders are working on different terpene profiles. As more states go rec, the wanting of great tasting CBD flowers are going in high demand. On the downside, with more rec means more regulations. Most CBD flowers are produced by smaller farms; the ones who try to help patients. With rec, comes Ag farms whose main concern is profit. It’s hard to predict what the new rec market will do or become. If you are breeding hemp stalk, there are great things to come as we move forward with hemp use. The hemp industry needs work as well, though, as far as its infrastructure and use of materials. But that’s a whole other conversation.”

GROWING CBD DOMINANT GENETICS: CANNABIS AND HEMP

To talk about the growing of high CBD versus THC strains, I thought it would be nice to ask another grower’s opinion on the matter. If you are going to talk to a grower, it might as well be Mike Cawley of Geek Farms in Oregon who, in my humble opinion, grows some of the best cannabis in the world. I asked him if there is any noticeable difference in the growth cycle of a THC-rich cannabis plant and a CBD-rich cannabis plant.

“Typically, THC-based cannabis is grown with the flower itself as the priority and most valuable aspect of the plant due to the fact most of the THC that is produced is retained in the flower itself,” Cawley says. “CBD can be found throughout the plant and percentages can fluctuate throughout the plants cycle. Opposed to THC-based cannabis that typically peaks towards the end of a flowering stage.”

Based on my own lab testing, I tend to agree with Cawley. Testing the same plant every day from three weeks into a “normal” harvest until thee weeks after, I found spiked percentages around the earlier testing, maximizing on that particular plant at two weeks before I would consider it “ready.” Also, THC spiked in the last two weeks. This means, with that particular genetic, we see a harvest date of two weeks earlier than when we are normally trained to harvest.

We went on to discuss the differences in growing styles between a rec/med CBD grow versus an agricultural hemp grow. “With states coming on board with CBD hemp processing regularly there is limited demand for ‘high-end hemp’ or ‘top-shelf CBD,’” Cawley says. “This drives the market towards an item where the terpenes don’t matter like they would in the recreational or medical THC markets. It is something that is more medicinally interactive and socially acceptable when you remove the smell and taboo of it all and keep with the medicinal properties of ingestion.”

Mike and I differ a little bit here, but I understand his take that keeping the product as close to a pharmaceutical product and less of a “cannabis-user” product will drive demand and legitimacy of your product amongst non-typical cannabis users. I will attest from personal experience that there is a “high-end CBD market,” but, as Mike states, it is not very strong. We got into talking about what the challenges rec and med producers have growing CBD in a market where AG Hemp is also available. The question came up: Now that Oregon is live with ag hemp allowed in OLCC stores, how does that change rec and med market share in these products? 

“It changes it very much so.,” Cawley explains, “With 21,000 acres of hemp being planted in 2017, I would expect that number to increase substantially once market acceptance and R&D is done in each region to find cultivars that work well. It will be hard pressed for the extremely regulated and/or canna-taxed markets to be able to compete with a product that one can acquire at a very low price.”

So, we get to the meat of the matter, is it worth growing CBD rich cannabis knowing what we do about the AG market coming online? “For a recreational and medical cannabis producer, I think mixed THC/CBD flowers will still be a draw,” Cawley says, “but as access to more CBD becomes available, and we talk about the vaporization options for CBD, oils similar to nicotine, that are proving to be popular in states like Florida for medical use and nicotine replacements, the market may be slim.”

Cawley continues, “I think as a home or medical grower, it would be silly to not grow at least some CBD for the medicinal aspect of it. It’s still cheaper than buying it on the market no matter how you cut it. Hemp is legal, that’s one thing I know. If you want to grow hemp, the US Agricultural act of 2014 defined it as anything with less than .3-percent THC. If your state allows hemp production you are well within your rights to grow a small patch of hemp for your personal use.”

So, taking what we can from this, it seems that CBD will still hold a large market share, but the methods you acquire it through will likely change. Taxes, licenses, and growing regulations favor the ag hemp grower in every possible way, making high CBD an undesirable market for recreational cannabis growers.

PRODUCTS FOR THE CBD MARKETPLACE

So, now producers have all of this hemp and are wondering what to do with it. There are many outlets for the plant and products that it can become. On an industrial side, “there are already tons of things we know common industrial hemp is useful for,” Two explains. “These include things like cooking oil, paper, plastics, fabrics and fiber, building material and bio fuels. With new technology sprouting up every day, we’re seeing things like hemp graphene, 3D-printed hemp houses and hemp cars.”

Then we look at the “medical market” for CBD oil extracted from the flowers of the plant. The oil can be used in many products. “The CBD market is huge these days with products in all different forms,” Two says. “Tinctures, topicals, candy, bath products, bottled water, pet supplies, and even suppositories are now CBD laden and very popular.” 

When asked about how the American market lines up with the rest of the world for industrial hemp products, Two says, “Unfortunately, since the hemp program in America is very limited, you don’t see a lot of demand for industrial hemp like you do in Europe, China, and even Canada. The United States has not yet built an infrastructure to support this new market. What we see now in the states is a more CBD-driven hemp program, which is a booming market, for now.”

All said and done, the CBD hemp market is an extremely interesting one and has a long way to grow. As more and more hemp farmers come online and more ways are utilized to process the plant, I think you will find that the industry will be active with innovation. There is really no waste product on a hemp plant as all parts are useful in one manner or another. It is a crop rich in its uses and is becoming a huge market for those willing to go from traditional cannabis growing into a realm that is, in every way, large-scale agricultural farming.

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