CANNAINVESTOR Magazine U.S. Privately Held Companies May/June 2018 | Page 184

There’s more to growing than just growing

A few years ago, everyone and his uncle in the northwest and Canada got the same slam-dunk idea: Grow cannabis. Now those U.S. markets are flooded, and early Canadian growers will be facing a variation of the same problem: Cannabis is becoming commoditized and price-driven.

But cannabis nurseries should be doing just fine, because there’s more to cultivation than just growing, and much of the real money is coming from those strain-selected clones.

Remember, there are three separate parts to growing cannabis: (1) Nursery Phase: Cloning and growing tissue cultures into two-inch plants, which take about two weeks. (2) Vegetative Phase: Growing the plants under 18+ hours of light a day for two to six weeks, depending on the size of plant desired. (3) Flowering Phase: which takes 7 – 12 weeks.

These are entirely separate businesses — cannabis nurseries and cannabis growers — and in Canada, the former is booming.

For example, in south-central British Columbia’s very arid Okanagan Valley, small growers have about three million sq. ft. under cultivation, growing about 400,000 cannabis plants X (let’s say) five indoor growing cycles a year.

And because plantings start with clones and seedlings, do you know how much those growers are paying? C$25 a seedling, which means they’re handing over roughly $50 million a year to nurseries on the Pacific coast.

And yes, business is booming for those people who “thought different.” Instead of following the crowd of growers, they chose to supply those growers with what they all needed. Just like the California gold rush: The big money was made not by the miners, but by the merchants who supplied them with pick-axes and other necessities.

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Survive and Thrive in a Tough Cannabis Market