LPs are beginning to move from greenhouses and indoor production facilities to outdoor growing, where being at the mercy of weather dramatically lowers the cost-per-gram.
MJ Biz Daily
- Since debuting outdoor growing last May, Health Canada has licensed 33 outdoor grows, with another 135 in waiting.
- MJ Biz Daily‘s Matt Lamers noted, “10 of the 33 outdoor cannabis cultivation approvals so far [have involved] outdoor. Among the 135 applications [in the Health Canada queue] with an outdoor area, 41 involve micros. Lots of micros/craft [producers see] outdoor as [an] important part of their [business] plans. Expect high quality from these producers.”
- NextLeaf CEO Paul Pedersen noted outdoor has changed the face of cultivation. “Companies who spent millions building greenhouses/large indoor AND struggling with quality are up against a flood of cheap outdoor biomass this fall. Many indoor cultivation assets are liabilities not assets.”
Lamers added, “Expect $200 million cannabis greenhouses to be in the news a lot in the months ahead, with headlines like [“Aurora Cannabis cease construction at Alberta, Denmark facilities as losses widen“].”
- EY’s Ashley Chiu noted, “Very few buyers for cultivation facilities in Canada. I see mostly international funds (primarily out of Europe), PE, alternative financing (albeit much less than before), specialized funds, those with licensing challenges, and a few operators looking to get into the space.”
- Alberta joins other provinces in extending agricultural grants to cannabis cultivators.
MJ Biz Daily