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California’s illegal cannabis industry three times bigger than regulated market

In fact, according to a report released Wednesday by the United Cannabis Business Association that was reported on by the Los Angeles Times, California’s marijuana illicit market is three times larger than the regulated industry established by the 2016 referendum. The audit found that there remains about 2,835 unlicensed dispensaries and delivery services throughout the state, compared with only 873 licensed marijuana dealers. 

The figures were highlighted as part of an effort by the United Cannabis Business Association, which represents licensed pot dealers in California, to crack down on Weedmaps, an app that allows users to locate dispensaries near them. 

The group contends that Weedmaps is still rife with listings for illicit marijuana dispensaries, despite the company’s pledge to remove them from the app. 

In a letter Wednesday to California Gov. Gavin Newsom (D), United Cannabis Business Association president Jerred Kiloh called on regulators to enforce Assembly Bill 97, legislation passed and signed this year that enables the state to levy $30,000 a day fines for unlicensed dealers. 

The bill took effect on July 1.

In the letter to Newsom, Kiloh drew attention to the string of recent vaping-related deaths.

“The severity of this situation cannot be underscored. We know too well the dangers of the unlicensed and unregulated market,” Kiloh said. “Just last week, after a series of deaths, the federal Food and Drug Administration (FDA) formally warned consumers to avoid vapes containing THC. While still under investigation, all 57 cases so far in California have involved purchases from unlicensed “pop-up” shops.”

“This outbreak serves as a tragic reminder of the dangers that the unlicensed industry poses to consumers. Licensed retailers are required to adhere to strict testing mandates that help prevent incidents like this from happening – the reality is, unless you are buying from a legal dispensary there is no guarantee of safety.”

Given the volume of illegal dispensaries present on Weedmaps, Kiloh claimed that the “California could levy fines against the platform of up to $85 million per day” if it were to enforce AB97.

“There’s simply no reason to wait, Californians are in danger,” Kiloh said. 

Weedmaps promised to crack down on the illegal dispensaries shown on the platform in an announcement late last month, saying it was “restricting the use of its point of sale, online orders, delivery logistics, and wholesale exchange software-as-a-service (SaaS) platforms to licensed operators exclusively.” 

In his letter Wednesday, Kiloh said that the legislation should be enforced to ensure that “Weedmaps’ toothless announcements are followed with real action.”

8 plant-training techniques explained

Topping

Removing the main crown shoot of your growing tip will ensure that two new shoots will grow back in its place. Pinching out once will create two tops; pinching out twice will create four tops; and so on. This technique is as simple as cleanly removing the growth tip until a lighter, fleshy-colored part of the plant tissue is exposed.

This will heal over and then form new growth shoots. It is very important to create a clean cut to avoid “fimming” (see below). I personally like to use a clean pair of nail cutters and to really get in and cut as close as possible. When incorporating a screen into the garden, topping is essential in creating a symmetrical canopy base from which to work.

Benefits: A plant’s height is basically cut in half-instead of one tall plant, the plant is separated into two parts. With this technique, the growth hormone that is responsible for apical dominance-in which a plant’s central stem is dominant-is cut off and a new hormone is emitted that promotes lateral growth. When the canopy is pinched out until the plant is flat-topped and multi-branched, canopy control is at its maximum.

Topping plants out will produce a greater number of smaller-size colas, as opposed to a main cola with supporting side branches if left untrained. This technique is ideal for growers who have limited space and want to avoid tall, lanky plants, and those growing plants with long vegetative periods, as this technique will produce a vibrant plant with eight heads in about 4-5 weeks.

Fimming

When fimming, 80 percent of the crown shoot is removed, with a very small amount left behind. In response, the plant will cease to produce upper growth, focusing its energy on the rest of itself underneath the highest part where it has been fimmed. Growth at the low part of the plant, from the very base of the pot and each internode upward, will increase, creating a thicker-looking plant. To use this technique, simply take a pair of scissors and snip away three-quarters of the tip of the crown shoot of the main cola or on the top shoots of the supporting side branches. “Fimming” is short for “Fuck, I missed!” because the technique was discovered by accident.

Benefits: Plants will have time to focus on enhancing the growth tips that are below the fimmed shoot. The lowest buds will have a chance to catch up with the rest of the upper growth, so when the top shoot does grow back to normal, the entire plant has increased in size. Fimming can create really bushy plants, and it can help avoid weak-producing lower buds.

Super Cropping

This is my favorite technique for pushing my plants to the limit. It’s a hands-on high-stress method that involves breaking the inner cell walls of a branch by popping it between your fingers. When successfully performing this technique, you’ll be able to hear an audible snap as the plant’s inner walls collapse-or at least feel a change in the pressure inside the plant.

With young softwood plants, popping the center parts of each internode will suffice; however, with plants that are more woody, it’s much easier to twist and a bend, and there’s a quicker healing response.

Benefits: If you have ever seen a plant that has an almost-round, knuckle-shaped growth forming over a bent branch, it’s been super-cropped. Once the inner cell walls in a branch collapse, growth hormones are sent to the break.

The result is a hardwood, protective growth that will not only provide added support, it will also boost the plant’s vigor and ability to respond to stress. A plant that has been super-cropped will be noticeably stronger in terms of vigor, stature and overall yield.

Tie and Bend

Otherwise known as low-stress training (LST), this technique involves tying and bending certain parts of the plant at certain times to compel the canopy to grow symmetrically. This technique involves tying the plant down with string or metal cables and lowering the highest point of the crown shoot. The plant will respond with the rest of the growth tips now competing to produce the main cola. Through careful calculation and planning, a grower can simply use leverage to compel the plant to form into a short and stout bush in which the main cola is unidentifiable come flowering time.

Benefits: The benefit of LST is that the canopy will be round with heavy side branches. Additionally, as the plant grows sideways, the axillary shoots that would’ve once produced small flowering sites will not grow upward and toward the light.

The end result comes down to how many times the plant’s been tied down to create new vertical shoots. This technique is also very important when using a screen, and it’s a great way to make those once tiny nugs into main colas.

Screens provide a trellis for branches to fill/ Erik Biksa

Using a Screen

Referred to as screen of green or ScrOG, this technique involves the application of a screen or net to act as a trellis through which your upper canopy will grow while clearing away the lowest part of the plant below the screen, ensuring a maximum yield of symmetrical flowering sites.

This method requires longer vegetative times than other plant-training techniques, as selected shoots must be fed through the screen over the growing phase. Making a screen is as simple as laying chicken wire over a wooden frame, tying bamboo shoots together in a square formation or even using wire or pea netting.

Benefits: Using a screen not only allows the grower to be totally hands-on with his plants; it also allows those with very small plant counts to achieve large yields in a small grow space. The plants have no choice but to dedicate all their growth above the screen, resulting in no low-hanging schwag buds and improved air flow below the canopy.

Pruning

Getting rid of fan leaves and low-growing tips is something that all growers should consider doing, but only at the proper time. Plants use their energy on whatever growth there is, so knowing when to cut away and strip the parts that are less productive than the upper parts is important. Take a pair of scissors and, as if you were taking clones, cut away the lowest growth of the plant that will take away from the prize buds you desire.

You should cut away everything from side branches to big healthy fan leaves. A good rule of thumb is to remove around 60 to 70 percent of the growth from the base of pots upward. You can also use your finger and thumb to strip away from the branches. Be vigilant to check for any new growth forming where the pruning took place.

Benefits: During the flowering stage, plants will exhibit the lollipop effect, where the main central stem has been stripped bare under a healthy, vibrant top canopy.

If you don’t prune the lowest parts of the plants, you’ll always struggle with the low-producing, light-deprived growth.

By clearing away a large proportion of the lowest plant parts, you can be assured that during the blooming phase the plant’s energy is being used as efficiently as possible and is focused on the heavy nugs on top. Pruning can make a big difference in the overall production of a cannabis plant, ranging from flower size to overall consistency.

Mainlining

This technique is slightly more complicated than traditional low-stress training, and it focuses solely on symmetrical plant growth. The principle behind mainlining is to remove the top shoot and all of a plant’s lower growth to create a bare stem. This allows the two axillary shoots to grow upward to form two primary shoots. If you picture a capital-Y shape and then grow from this starting figure, you can then tie the two shoots down to allow them to grow in a letter-T figure.

Benefits: Although it can seem like a very stressful training method and can certainly feel counterproductive, the important thing is to stick with it. Due to a carefully arranged symmetrical design, the plant will send signals to each pathway to make sure that each bud flowers and grows the same as all the others. The end result can be very impressive, but keep in mind that this method is for more experienced gardeners and requires much patience.

Strip and Flip

This method involves pruning away everything underneath the top internode of the plant’s branches a few days before flowering. This focuses all the plant’s energy into the remaining nodes. A full-scale prune can be quite drastic, and it’s the last thing anyone would do to their precious plants, yet this technique works. What’s left is a very skinny-looking structure with only one top shoot, but when it flowers it grows quite top-heavy.

Benefits: This technique removes the risk of any lower-producing popcorn nugs, provides an excellent opportunity to take some healthy cuttings for future grows, improves air flow and reduces insect and pest infestations. The flowers that the plant produces will be thick and dense. The end result will be uniform nugs that are each around 3-5 inches in size with substantial biomass.

Using proper techniques, growers can produce plenty of flowers with fewer plants/ Erik Biksa

Top Tips on Plant Count

Large Plants

Growing large-size plants that take up quite a bit of room requires long vegetative periods to produce as much productive foliage as possible. One can argue about which method produces larger yields: one large plant or many smaller plants under the same grow light. My tip here is to dedicate a grow tent for one or two very large plants. Avoid vegging many plants in a tent as they’ll fight for light and overshadow one another as blooming commences.

Light Output

You may have purchased a 10-pack of the latest and greatest genetics, and although you calculate that planting 9 seeds under a 600-watt lamp will result in a 9-ounce yield, it really depends on the integrity of your lighting setup. Grow lights are measured in lumen count and photosynthetic active radiation (PAR). My tip here is to find out the amount of PAR your lights are emitting, then work out if it’s adequate enough to produce heavy-yielding plants.

Sea-of-Green Method

This method requires very short vegging times and a quick introduction to flowering.

The principle behind SOG is to grow as many small plants as possible in a limited space. The turnaround time may be a week longer than the flowering period for commercial growers. Make sure the strain you’re growing is well suited for a SOG grow (such as a short-flowering /nd/’ca-dominant variety) to make the process as straightforward as possible.

Strain Selection

There are many varieties of cannabis on the market these days, each displaying traits of indica, sativa or a mixture of both. Growing indica-dominant varieties will allow a grower to produce smaller-size plants. Hybrids can extend taller, and saf/Va-dominant strains will tend to stretch out even more. My tip here is to learn as much as possible about the strain you’re growing. It can determine a short or long vegging period, as well as if SOG or ScrOG is the right method to use.

Skill Level and Experience

If you’re new to growing cannabis, it’s better to grow a few smaller-size plants at first to learn the ways of the plant. If you’re more experienced, then generally having a larger plant is the norm, and the level of plant training that can be provided will result in a huge difference in terms of canopy control and final yield. A shorter vegetative time is more forgiving to the beginner, providing less time

to make catastrophic mistakes. Grow according to your skill level in terms of plant count, strain selection and nutrient use.

Budget

Your plant count and vegging time may be limited due to your budget; for example, electricity costs soar during the longer 18-hour lights-on periods. You may also be limited in nutrients and prefer to flower as soon as possible to save more during the growing stage. You may also be restricted to pot size, lighting capacity and many other things due to financial restrictions, so plan ahead to spend and grow within your time and financial constraints.

Vegging Room

For growers who have a vegging tent and a flowering tent, growing larger plants is probably not necessary, as a constant rotation of smaller-size plants is beneficial and practical. Invest in a tent solely for growing seedlings and clones until they are mature enough to be transferred to the flowering tent.

With the above options for training your plants, you’ll be able to find a technique that is well-suited for your individual space, time and financial considerations. Experiment and have fun-when harvest time comes around you’ll have some dank nugs to celebrate with and begin to plan your next grow!

Sorry, marijuana fans: Illinois is having trouble preparing for recreational weed

Recreational marijuana will soon be legal mere miles from Evansville. But that doesn’t mean it’ll be easy to get.

As we all know, Illinois legalized weed over the summer. Sales are set to begin on Jan. 1.

According to reports from The Chicago Tribune and others, though, preparation for the rollout has been messy and shrouded in confusion.

Only five dispensaries have nabbed licenses to offer recreational marijuana so far. Most of them sit close to Chicago, and the closest one to Evansville – The Clinic Effingham – is about two-and-half hours away.

One, in Naperville, won’t be able to sell weed at all after the Naperville City Council voted last week to prohibit recreational sales within city limits. Voters will now decide pot's fate in a public referendum. 

The village of Mundelein may kneecap its legal clinic as well, and other towns could do the same as Illinois hands out more licenses through this year and next.

But that’s far from the only problem. Even dispensaries in pot-friendly places are a tad perplexed over what Illinois will require of them.

The bill that legalized weed gave state officials 180 days to conjure regulations for their new industry. With a little more than 100 days before the business goes live, those regulations haven’t been released yet, and may not hit the books until right before legal sales begin.

'In the dark'

“There will be a lot of dispensaries not ready,” Gorgi Naumovski, CEO of Thrive Dispensary, told the Chicago Tribune. “We’re all in the dark.”

That’s apparent when you call Thrive. The company owns two medical dispensaries in Southern Illinois, including one in Harrisburg — about 60 miles from Evansville.

Like most medical clinics, it would probably be thrilled to branch into recreational marijuana.

But if you ring them up to ask about that, you’re immediately re-routed to a voice message that politely begs you not to ask them about the law.   

“If you are calling for information regarding the Illinois recreational cannabis program,” the voice chipperly says, “please visit the Illinois Department of Public Health website for further information.”

That would be excellent advice – if you could find any information on that website.

Links for medicinal marijuana light up the homepage, but there's nothing about recreational readily available. And if you search “recreational cannabis,” all you get are minutes from a State Board of Health meeting from September 2018.

If you search “recreational marijuana,” the website asks, “did you mean educational Marion?”

Capitalism 

Then there's the issue of who's going to dominate the industry. 

If you dreamed of moving to Illinois to start a hip mom-and-pop business, I’ve got bad news for you: you’re gonna have some serious competition.

Of the five dispensaries that have nabbed recreational licenses thus far, all are at least partially owned by Green-Thumb Industries – a national weed corporation.

America spent decades demonizing pot, but capitalism, god bless it, embraced the drug as soon as it become legal. We’re probably only a few years away from Walmart stocking its own weed strain next to the Count Chocula.

All this leaves business owners and potential users teetering in uncertainty.

Deputy Gov. Christian Mitchell assured the Tribune that Illinois will be more than ready when legal sales begin. But weed proponents might want to curb their enthusiasm just in case.

That shouldn't be a problem. Some of you are pretty chill already. 

2 marijuana stocks making headway in September

The marijuana stock market has been waiting for a solid push for some time now. With so many companies entering the industry, it seems as though the competition is at an all-time high. The competition that we have seen however has been very positive as many companies are working to innovate in such a new industry.

This, however, has not made it any easier to find marijuana stocks to watch. For this reason, it is always important to do all the proper research before investing in a given pot stock. This way, there will be no surprises when it comes time to put money into a marijuana stock or not. There are many options when it comes to pot stocks to watch, so here are just a few.

A Pot Stock That Produces Cannabis

1933 Industries Inc. (TGIFF Stock Report) (TGIF Stock Report) is a vertically integrated producer of cannabis through their various in house brands. The company has several subsidiaries that they operate within including AMA Flower and AMA Concentrates. Additionally, they also own CBD-infused Canna Hemp as well as Canna Hemp X. Because of their large diversity of pot based products, the company has exposure to many different aspects of the shifting cannabis market.

The company has been working under various licensing agreements as well including ones with Denver Dab Co., Birdhouse Skateboards, Kurupt Moonrocks and more. As the health and wellness side of the marijuana stock market continues to skyrocket in value, it looks as though 1933 Industries is playing quite a large role in its growth.

1933 Industries Announces an Update

The company recently stated that they have commenced on a transfer of their cannabis plants to a new cultivation facility based out of Las Vegas. Tim Spencer, Director of Cultivation stated that “This is a brand new facility and we worked around the clock to ensure that all systems were operational before transferring our plants.”

The new facility will allow them to create a large number of production increases through various advancements in the technology they use. With their increased production, they should also be able to satisfy the needs of their growing demand. Of course, it may take some time to see these numbers reflected in the company’s financials but things are looking up. For now, 1933 Industries remains a key marijuana stock to watch.

An Ancillary Pot Stock To Watch

KushCo Holdings (KSHB Stock Report) is a pot stock that does not fit in the traditional description of what a pot stock is. Instead, they lie within the ancillary market on cannabis. The company is a large producer of various packaging solutions for those who produce marijuana in different forms.

KushCo Holdings has also been working to sell products recently such as vapes, edibles, infused beverages and more. The company has stated that they also help to create marketing and branding solutions for marijuana stocks looking to get ahead. Because they are so broadly based in the marijuana stock market. KushCo remains an interesting pot stock to watch.

Hemp makes marijuana crimes difficult to prosecute

While Senate Majority Leader Mitch McConnell would like to think that, in addition to being the “Grim Reaper” of Capitol Hill, he hung the moon and is perhaps even the savior of American morality, it turns out that he’s probably not as smart as he’d like to believe. Because while he was scrambling around last year trying to become the godfather of industrial hemp legalization 2.0, not he, nor any of his lackey goons, stopped to consider that legitimizing a plant in the United States that is a first cousin to marijuana would somehow come back and bite him in his Kentucky tuchus.

But how?

Well, since weed and hemp are of the cannabis sativa classification, law enforcement is now having a heck of a time telling the two plants apart. It is a situation that has forced prosecutors all over the country to dismiss marijuana-related cases. They simply cannot determine without laboratory testing if a person is connected to illicit drugs or whether they are part of the nation’s newfound hemp trade. In fact, it is possible that this little snag in the system could eventually force the U.S. government to throw its hands up and finally legalize the leaf once and for all.

Indeed, marijuana prohibition is becoming more difficult to enforce nationwide. It’s a bit of a conundrum that is just now starting to become realized in the 47 states that have put hemp laws on the books. The passing of the 2018 Farm Bill, which legalized industrial hemp in the U.S. for the first time since 1937, is really causing some trouble for those officials in charge of busting people for pot.

Smart boy McConnell, who still opposes legal weed, didn’t realize just how similar the two plants were when he rallied to spearhead hemp production. The only difference is, one gets people high and the other, with only .3% THC, can’t. But scientifically speaking, the two plants are the same — they are similar in appearance and have the same odor — which is throwing off K-9 units and field drug tests during those ever-so-popular roadside shakedowns. In fact, the only way law enforcement agencies can distinguish between hemp and marijuana is by sending questionable products to the crime lab for analysis.

Yet, not even this drawn out process is a reasonable solution to this debacle. These tests are expensive and, more importantly, they create a backlog for labs. Since nobody has time for all of that, some jurisdictions, including parts of Ohio and Texas, are trying to either find alternative measures for lab testing (perhaps farming these cases out to private firms) or they are simply pulling the plug on minor pot possession charges altogether. Because if they moved forward with prosecution, the alleged offenders would walk.

“The prosecution of marijuana possession charges would require drug testing that distinguishes hemp from marijuana,” Columbus City Attorney Zach Klein told the Columbus Dispatch. “Without this drug-testing capability, the city attorney’s office is not able to prove misdemeanor marijuana possession beyond a reasonable doubt” since “our current drug-testing technology is not able to differentiate.”

If we’re honest, it’s not like a slew of prosecutors across the country have all of a sudden stood up and said to hell with marijuana cases. If only we were that lucky. But we are starting to see more jurisdictions, including parts of Florida and Georgia, where this sort of retreat on the reefer is happening at the local level. We suspect the trend will continue to grow, eventually forcing state lawmakers to either give consideration to the decriminalization of marijuana or full blown-legalization. Meanwhile, it isn’t going to take long for the confusion over hemp and marijuana to land smack dab in the middle of Washington D.C. And if Grim McConnell is still in his seat following the 2020 election — of course with a new staff because he fired the old ones for being too stupid to see that his hemp mission was going to inadvertently lead to marijuana legalization — we imagine his attitude over all cannabis plants will change in the spirit of good old fashioned politics and there will finally be a push to bring the stoner cousin out of the underground.

If that transpires, Mitch McConnell could end up being the best thing to ever happen to marijuana.

Yep, it’s a weird world.

How cannabis and CBD can help eliminate the stigma around mental illness

With marijuana use and mental health both wildly stigmatized, perhaps there are solutions in place that are as simple as having a conversation.

Millions of Americans are coping with mental health issues. Often undiagnosed or misdiagnosed, those who suffer in silence with mental illness issues often remain silent due to the stigmatization that shrouds depression, anxiety, and other psychiatric disorders.

Two perspectives on cannabis and mental health

Olivia Alexander, the founder of Kush Queens, an online retailer in CBD and Cannabis products, shared recently that she questioned growing a business and leading a team while addressing using cannabis for her mental health. “It’s a hard thing to admit that some days you can’t cope with daily life without cannabis,” Olivia explains online. CBD and cannabis helped ease the symptoms of Olivia’s bipolar disorder and Olivia found that she was more successful using cannabis than without. 

But, there’s another side to the story. Dr. Elinore F. McCance-Katz believes that substances like marijuana can carry mental health risks. Speaking in 2018, she shared, “As a clinical psychiatrist specializing in addiction, as someone committed to treating people with substance use disorders, as a concerned American—I cannot stress enough how understated the risks and consequences tied to marijuana consumption are in our nation’s dialogue.” Dr. McCane-Katz listed risks such as a decrease in IQ and a “predisposition to mental illness” as risks that society needs to address.

Movember

Interestingly, a study in 2016 demonstrates no loss of IQ in British teens who consumed marijuana. 

“Marijuana users lost about four IQ points over the course of the study. But their abstinent twin siblings showed a similar pattern of decline, suggesting that the loss of mental sharpness was due to something other than pot…” (The American Association for the Advancement of Science

Two wildly-different perspectives lead to one, gigantic question: At what point do rewards outweigh risks? 

Mental Health: The figures involved

The National Alliance on Mental Illness, (NAMI,) shared powerful statistics around mental health that may offer more insight: 

  • Approximately 1 in 5 adults in the U.S. (46.6 million) experiences mental illness in a given year.
  • Serious mental illness costs America $193.2 billion in lost earnings per year.
  • 6.9% of adults in the U.S.—16 million—had at least one major depressive episode in the past year. 
  • Only 41% of adults in the U.S. with a mental health condition received mental health services in the past year. Among adults with a serious mental illness, 62.9% received mental health services in the past year.
  • Suicide is the 10th leading cause of death in the U.S., and the 2nd leading cause of death for people aged 10–34.

Steps to a solution

It may currently be a stretch to stay that cannabis can eliminate the stigma of mental illness, but it certainly has the power to empower and start conversations that can lead to healing. Ljubica Kostovic from TRNTO believes that perception is already changing in CBD and cannabis, with individuals more willing to use for pain, anxiety, and PTSD. He shared, “Cannabis has been used for medical purposes for thousands of years and has been used to treat mental health conditions for over a century — its full legalization on a federal level presents a unique opportunity for us to explore.”  

Cannabis Does Not Lead To An Increase In Suicidal BehaviorWith marijuana use and mental health both wildly stigmatized, perhaps there are solutions in place that are as simple as a conversation. Twisp House of Cannabis in Washington recently hired a 74-year-old woman named Sonja, as they noticed many of their older patrons wanted to speak to someone who was currently or had been in their place. Undergoing certification, Sonja is hoping to eliminate the stigma of cannabis by sharing her story and the benefits of marijuana with adults who may not have asked before, a tactic often used in the mental health community that allows for greater inclusion and trust.  

Stories are an incredible balm, aren’t they? When individuals feel safe in sharing, it allows others to do the same. 

What CannTrust's new allegations of wrongdoing could mean for the Industry

The CannTrust Holdings (NYSE:CTST) scandal just keeps on getting bigger. While we're still waiting on a decision from Health Canada on what its punishment will be in relation to illegally growing marijuana, last week the public learned of even more potential problems: Multiple sources told BNN Bloomberg that seeds from the black market found their way into CannTrust's operations.

The industry has been hit hard

It may be a bit unsurprising for a company that's already faced allegations that it created fake walls to hide illegal growing operations from regulators, but it still has had a negative impact on the industry as investors are clearly showing a lack of confidence in pot stocks. Canadian producers, in particular, have been struggling. Since July, which is around the time that the CannTrust scandal first emerged, the Horizons Marijuana Life Sciences Index ETF (OTC:HMLSF) has fallen by about 18%. And to make matters worse, there has also been lots of negative press surrounding Curaleaf (OTC:CURLF) making exaggerated claims on what its products can do, drawing the attention of the U.S. Food and Drug Administration. There have also been claims made by short-sellers that Hexo (NYSE:HEXO) might be in trouble as a result of aggressive advertising practices.

The worst might not be over for the industry, because until Health Canada hands down a decision on CannTrust, there's going to be a big question mark surrounding what kind of precedent Canadian regulators will set. It has taken just three months for CannTrust to lose more than two-thirds of its value, and there could still be more losses to come. Investors could be worried about which company will be the next to get into trouble.

A cannabis plant in an indoor grow facility.

Will this create a new wave of cannabis companies?

Trust is becoming a growing issue in the industry, and that could create a big opportunity for businesses and investors. Getting the correct product and the right mix of cannabidiol (CBD) and tetrahydrocannabinol (THC) is important for medical marijuana patients to ensure the product they are taking is safe and suitable for their needs. Recreational users also want to ensure they're getting a product that works for them. That's why the issue of CannTrust mislabeling products could pave the way for more transparency and the need for testing.

For medical marijuana patients, a DNA testing kit that can help give users more information about how their bodies will respond to cannabis will be very important in helping them make an educated decision about which kind of product they will need. It may seem like an excessive step to take, but with so many cannabis companies out there and doctors not always willing to recommend marijuana, it's going to be necessary, at least in the early stages of the industry's growth. Private company Lobo Genetics in Canada already offers a direct-to-consumer testing kit that will help build a genetic profile that can help give customers insights into the risks they may face and can make recommendations relating to an individual's cannabis use.

Meanwhile, TruTrace Technologies  is hoping to use blockchain technology to help identify and trace cannabis products to help verify details related to its contents, providing consumers with some transparency. While it is still in its pilot phases, it's already landed Aphria as a partner.

Takeaway for investors

Remember that there are many different ways to invest in the industry if you're uncomfortable with the volatility of cannabis producers. With concerns about the quality and accuracy of cannabis products on the rise, a whole new segment of the market could open up that focuses on verifying and validating cannabis products and matching them to the specific needs of customers.

USA 2019 hemp season a stunner

More than 510,000 acres of hemp were licensed across 34 U.S states in 2019, representing an increase of over 455% compared to 2018 according to VoteHemp.

However, what is licensed compared to what is actually planted and then harvested will be very different numbers.

VoteHemp estimates 230,000 acres will have been actually planted and as for what will be harvested, it’s making a guesstimate of 115,000 – 138,000 acres. But being a relatively new crop in recent times, issues such as seed availability and lack of experience play a role in the big difference in numbers.

Regardless, 2019 demonstrates solid progress.

“We are seeing hemp cultivation dramatically expand in the U.S. in 2019, with over quadruple the number of acres licensed in hemp compared to last year and the addition of 13 more states with hemp programs,” said Eric Steenstra, President of Vote Hemp

Vote Hemp’s 2018 U.S. Hemp Crop Report estimated 78,176 acres were cultivated in 2018 and just 25,713 acres in 2017.

Other highlights in the 2019 report:

  • State cultivation licenses were issued to 16,877 farmers and researchers, a 476% increase over 2018.
  • States with licensed processors reported 2,880 processing licenses, an increase of 483% over 2018.

Pushing things along in 2019 was the signing of the 2018 Farm Bill late last year that lifted federal prohibition on hemp farming, distinguishing the crop from marijuana.

U.S. hemp holdout states are now very much on the outer, with only Idaho, South Dakota, Mississippi and New Hampshire yet to enact legislation. Last year at the time of VoteHemp’s 2018 report, there were nine states yet to do so.

Even among those left, legislation is in the pipeline for most – although South Dakota Governor Kristi Noem appears to be doing all she can to prevent a hemp industry of any substance starting up under her watch. It’s quite possible South Dakota will be the last state to allow widespread cultivation of the crop within its borders given Ms. Noem only started her role as Governor in late 2018.

Nationally, the future is looking bright for next year, with the USDA expected to publish new federal regulations for hemp cultivation soon and in time for the 2020 growing season.

More detail from VoteHemp’s 2019 Hemp License Report can be viewed here.