Lets pick colorado for a state since I live here. Companies that are not growing their own feedstock, buying from outside sources and making butane dabbable products. Do they see good profits each year, compare that to co2-distillate companies, do they see remarkably different profits? I realize this will vary wildly from company to company, but my curiosity is peaked. Being a manager the past 3 years, I have come to the conclusion that extraction companies that outsource are barely holding on. Realllllly hoping I am wrong on that front.
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Vertical integration has become almost the only way to come out on the green side of things in Colorado. Grow, Process, Retail
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Really depends if you have a way to get rid of your product with margins that will keep you at bay. Also what your overhead is vs. how much you can produce/sell. I work for a co2 extraction company and we’ve been fortunate to sell our wholesale FS Distillate from $1400 - $800 depending on quantities.
Doing splits on high quality biomass has helped us a lot during the first two years, but now we are outsourcing biomass because we are selling as much as we can produce and splits are not helping us get to our required production numbers. Eventually, growing will be the final step but biomass is still very cheap. This distillate price leaves us with pretty good margins and the few customers who have brands/manufacturing companies seem to like the consistency, quality of the product and our customer service.
If it weren’t for great customers who are willing to pay over market value, we would not be in business. We would have virtually no margins if we had to sell distillate for $150-300 which is common now a days. I’d like to see an increase in Distillate/Isolate prices once the market levels out and the overproduction of 2019 is either converted into d8, hhc etc or discarded due to improper storage. We’ll see how things turn out this year and following but we’re definitely happy to still be in business.
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Every single MIP I know in Colorado that relies on outside material produces inconsistent garbage hash. I also can’t think of a single one that is long term profitable. Ol’ mahatma was a good indicator of this. Vertical integration is an absolute must. Green Dot, Leiffa, Olio, 710, Lazer Cat, all their really fire gear comes from their own grows and genetics. They all still offer processing for outside companies, but it is by no means their bread and butter.
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I really don’t know if one can compare the CBD market to the THC market. CBD is paying a couple dollars a pound for biomass and has a national audience to serve. Very different animals in my opinion.
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Wholeheartedly agree
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I completely agree and didn’t realize the op was talking about the THC market. My apologies!
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Traditional market.
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If you can make good products and you have someone to market them then that shouldn’t be too much of an issue
But as others have said, you need to be able to produce what you process
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Same in California. Anyone not vertically integrated either can’t source fire stuff to make a meaningful brand or sell their product with enough margin at their own retail store to pay the bills. All while backdooring stuff the whole time. Lol
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Cbd market is unsustainable and I hope there’s a serious supply correction coming in the next 12 months. We produce every product at cost from seed to oil with the smallest team that I know of. At current market prices we’re taking a L. Produce seed at about .01, farm at cost, that shit ain’t cheap far as tractors, combines, water, and field labor goes. We produce bio at about $1 /lb. And it’s worth about $3/lb on the backend at distillate @ 150/kg at a 5% yield to distillate. Retail cbd products are pretty stable at about .02c/mg which is 20 bucks for 1000mg tincture, sometimes a lot more honestly. Wholesale cbd goes for 100x less than that/mg at .15c/gram. Painful.
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But it’s hemp
It’s not something that a lot of people want, and there’s a ton of people growing it/processing it
It’s pretty much feedstock for conversion
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Growers have dropped off a cliff. Processors are thinning out. It’s a legit product that works and is widely available nationwide, even ppl who are opposed to thc are open to taking cbd.Only takes about 30,000 acres to supply the USA on an annual basis is the biggest problem.
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Okay, no disrespect to your hustle, but there were a lot of claims made at the beginning of the hemp craze, and very few of them have been substantiated…
It helps anxiety and it helps seizures…
I’ve had zero effect of it helping with pain.
It has a placebo effect on a lot of people who cannot get thc
But in states where they sell thc, it’s definitely not sold like it is in illegal states…
Yet when thc is legalized in states, the opioid and benzo prescriptions decrease, general doctors visits decrease, but the daily medicine like heart and blood pressure shit people need every day don’t change…
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Now it’s a chance to grow a huge crop of weed which is what a lot of people with hemp licenses do
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Yeah. Hear ya. Fed legalization of thc or the onset of ‘ thc biomass ‘ will probably see an even steeper correction than cbd saw, In my opinion
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So do these companies employ in house breeders? Would be a job I would love to do =)
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When’s this correction taking place you think?
Federal legalization, interstate commerce