In Today’s Issue:
→ Infused Pre-Rolls. 🌿
→ Social Equity In California. 💸
→ The Republicans Plan. 🇺🇸
The Demand For Infused Pre-Rolls
Producers are reaping the rewards of producing infused pre-rolls…
We all know consumers care about the amount of THC a product contains.
In Canada, we have even seen certain provinces introduce policies where they will only purchase cannabis flower that meets certain THC thresholds.
The perfect product…
This demand for high THC products works great for the limited numbers of producers who are capable of cultivating cannabis that has 30% THC.
For the majority of producers who can’t produce these products — an alternative is emerging.
As opposed to producing cannabis with 30% THC, a growing list of brands are increasing the THC content of their dried cannabis flower by infusing it with cannabis concentrates.
To understand the benefits of infusing dried flower with cannabis concentrates, we only need to look to California where the top pre-roll brand in the state is infusing their pre-rolls.
In fact, Jetters which is the top-selling pre-roll brand selling 2 million Jetters per month in California, is now the top pre-roll brand in the U.S.
Founded in 2018, the brand which employs 700 people has taken the market by storm courtesy of infusing its line of pre-rolls with live resin.
There’s a long list of reasons why producers are choosing to add cannabis concentrates to dried flower, however, we will focus on two factors.
1. What Consumers Want
We can debate the merits of consumers only purchasing the highest THC percentage products.
That said, a cannabis brand’s objective is not to convince consumers of what they want — rather it’s to produce the products that they want.
Today, cannabis consumers care about the quantity of THC in the products they are purchasing, and infusing products allows producers to create cannabis products consumers want.
2. Providing Consistent Experiences
It’s impossible for producers to produce cannabis flower that consistently has the exact same cannabinoid & terpene profiles.
Consequently, even if a consumer purchases the same product, produced by the same brand — there’s a high possibility that the product won’t produce the same experience.
Measuring a product’s cannabinoid & terpene profiles and adding cannabis concentrates allows producers to produce products that consistently produce the same outcome.
One of the primary competitive advantages craft cannabis producers have historically had over larger cannabis producers is their ability to produce cannabis flower with much higher THC percentages.
I see no reason why larger producers won’t simply infuse their dried cannabis flower with cannabis concentrates to compete moving forward.
This innovation makes so much sense, and it seems likely we will see a lot of companies — both big & small implementing this practice in the coming years.
I will be keeping a close eye on this area in the coming months as Canada has recently clarified that these products are permitted.
Social Equity In California
A new report criticizes the cannabis social equity program in California…
The history of cannabis informs us that the reason why cannabis became illegal had very little to do with cannabis, and a lot more to do with the people who were consuming cannabis at the time.
The cannabis industry has an opportunity to rectify the wrongs of the past by ensuring everyone has an equal opportunity to help build this industry.
I personally think the right thing to do is to ensure that the targets of the war on drugs are given an opportunity to help build this new industry, and the state of California agrees.
Unfortunately, good intentions don’t always produce the right outcomes, and the California Cannabis Industry Association is asking California to step up.
“California’s cannabis social equity programming is not working as intended” — California Cannabis Industry Association said.
The report focused on regions that were among the first to receive state funding under a 2018 law called the California Cannabis Equity Act.
The bill provides millions of dollars in grants all across California, however, with a lack of oversight — there’s room for improvement.
“Applicants are waiting years for local approval, yet paying thousands of dollars in rent for property that has yet to be utilized.”
This results in people running out of capital, and they lose the opportunity to help contribute to the success of the cannabis industry.
Ever before they sold a single gram of weed.
They have made several suggestions:
Create a new oversight committee of equity operators and community members to ensure state funds are allocated appropriately.
Increase financial assistance for social equity participants, including license fee deferrals, tax relief, and support with startup costs.
Increase state funding to ensure the programs have enough capital to succeed as intended.
Last year alone, California made $817 million USD in taxes from the adult-use cannabis market.
The cannabis industry is generating more than enough taxation revenue for the state of California to adequately support social equity applicants.
The Republican Plan
The republicans are entering the race to claim credit for legalizing cannabis…
With 68% of Americans supporting the legalization of cannabis, there are significant political points on offer for the party that succeeds in implementing this policy change.
So far, we have seen a number of attempts made by the democrats to pass policy changes that would legalize cannabis, however, the Republicans are now working on a bill of their own.
Republicans vs Democrats
Historically, legalizing cannabis has been a cause championed by the Democrats, however, legalizing cannabis now has bipartisan support.
Despite their head start, the inability of the Democrats to achieve a consensus on what the right regulations for cannabis ought to look like has presented an opportunity to the Republicans.
A republican bill…
The measure, titled the States Reform Act, is said to be ready for release later this month, with the Republicans currently seeking internal feedback before its official release.
Per the initial draft, the following are 6 key points of consideration:
Cannabis will be federally rescheduled, with the regulations treating cannabis closer to alcohol with a mandatory 21 age limit for adult-use cannabis.
2. Cannabis Taxes
Consumers would pay a 3.75% excise tax when purchasing cannabis products.
3. Current Licenses
Existing state-licensed cannabis operators would be “grandfathered” into the federal licensing system to minimize the impact on existing operators.
4. Cannabis Expungements
Non-violent cannabis convictions would be eligible for expungements.
5. Interstate Commerce
Interstate commerce is permitted with the Treasury Department’s Alcohol and Tobacco Tax and Trade Bureau overseeing interstate commerce.
The Bureau of Labor Statistics would also be required to issue a report to Congress on the cannabis industry moving forward.
6. Regulatory Oversight
The Food and Drug Administration would oversee medical cannabis, however, they would have very limited oversight over adult-use cannabis products.
7. Cannabis For Veterans
Veterans cannot face discrimination in federal hiring for consuming cannabis & the U.S. Department of Veterans Affairs (VA) would be specifically authorized to issue recommendations for medical cannabis for veterans.
While it has taken a considerable amount of time for the Republican party to accept cannabis, I do not rule out the possibility that they will be responsible for legalizing cannabis.
So long as they don’t change the proposed taxation rate before the bills official release — it will very likely be viewed as the best proposal to date.
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