Marijuana Law, Policy & Reform

Editor: Douglas A. Berman
Moritz College of Law

Sunday, May 17, 2015

More on the "ag-tech revolution" being spurred by legalized cannabis crops

In this post from a few weeks ago, I was promped by an article about the Tesla battery and marijuana cultivation to ask this question is a post title: "Could/will the marijuana industry become a boon for green energy innovation?".  Continuing with the theme of innovations for ganja growing is this fascinating new article via the International Business Times headlined "Legal Marijuana Cultivation Is Driving A Technology 'Revolution' In Industrial Agriculture." Here are excerpts:

[A] growing number of companies in North America [are] designing new products and systems specifically for the cultivation of cannabis, a finicky crop that needs a precise balance of light, moisture and water to thrive. Although these cannabis ventures aren’t exactly reinventing the wheel -- greenhouse technologies have existed for decades -- they are injecting the kinds of capital and brainpower into the field of industrial agriculture that simply wasn’t there a decade ago.

They’re also adding a new level of urgency. As more countries and U.S. states soften their policies on both medical and recreational marijuana, companies are racing to become the industry leaders in data-mining software, ultraefficient lamps and water-sipping irrigation systems. These tools will benefit more than marijuana growers alone: Industrial food producers and tree growers could adapt the same technologies to cut energy costs and boost their crops. Operators of large buildings could use the systems to lower their electricity use.

“Cannabis is spurring on an ag-tech revolution,” said Troy Dayton, CEO of ArcView Group, a cannabis-industry research firm in Oakland, California. “This is a boom born entirely out of ending repressive laws. The market is already there, it’s just moving from the shadows into the light. That’s why you’re seeing this incredible growth and why so many people see it as a once-in-a-lifetime [business] opportunity.”

That market is rapidly expanding in the U.S., where 23 states have already legalized medical marijuana, and three states -- Alaska, Colorado and Washington -- allow recreational-marijuana sales. Voters in Oregon approved a ballot measure last fall that allows for personal pot use and limited cultivation. The policy takes effect July 1. In Texas, Ohio, Nebraska and a number of other states, voters and policymakers are considering similar initiatives. (In Canada, medical-marijuana use was legalized in 2001, and recent policy changes are enabling a rise in industrial growing operations.)....

Companies such as Heliostat are moving into the cannabis space for three key reasons -- first and foremost, cash. Unlike tomato and pepper producers, cannabis growers boast wide profit margins, giving them a bigger budget for top-of-the-line technologies and a greater appetite for research and experimentation....

Second, young technology whizzes and expert plant biologists are both bringing their skills to the burgeoning sector. “For the newer generation that’s just getting out of college or new to the workplace, cannabis is a more interesting project than say a real-estate project, or a lettuce project,” said Michael Mayes, CEO of Quantum 9 Inc., a Chicago consulting firm for cannabis cultivation and manufacturing. “The cool factor can drive innovation.”

Third, there is plenty of demand among growers. As they build new greenhouses and indoor facilities, they’re interested in shaving off as much electricity and water consumption as possible to reduce operating expenses and protect profit margins as more players enter the market.

Dayton of ArcView Group said the cannabis industry is still in the earliest stages of its technology “renaissance,” and that the only thing holding it back are prohibitive marijuana policies in certain states.

Even so, the gradual easing of cannabis laws is already drawing interest from mainstream businesses, including a subsidiary of Scotts Miracle-Gro Co. The company’s Hawthorne Gardening Co. in April purchased General Hydroponics Inc. and Bio-Organic Solutions Inc., which make liquid nutrients for indoor marijuana cultivation. Terms were not disclosed, but the acquisition should make Scotts, with its $2.97 billion in annual revenue, a formidable player in the marijuana market.

Prior related post:

Could/will the marijuana industry become a boon for green energy innovation?

http://lawprofessors.typepad.com/marijuana_law/2015/05/more-on-the-ag-tech-revolution-being-spurred-by-legalized-cannabis-crops.html

Medical Marijuana State Laws and Reforms, Recreational Marijuana State Laws and Reforms, Science, Web/Tech | Permalink

Comments

Post a comment