Vol. 7, No. 1-- September 27, 2019 - Edited by Dr Lloyd Covens
NEXT UP: NADLER'S "MORE" BILL - Following the historic Sept. 25th passage of the SAFE banking act in the House (321 to 103,no), Judiciary chair Jerry Nadler promises his follow-on "MORE( Marijuana Opportunity Reinvestment and Expungement Act) bill will propose to move marijuana off schedule 1, and to seek to federally decriminalize all adult MJ use. Along with co-sponsor Sen. Kamala Harris, Nadler would like to see a Judiciary hearing, and possible full bill vote by year end. As Judiciary chair, however, Nadler will be a key House leader organizing the inquiry into whether to impeach President Trump. Likewise, the tense DC battle will also sap time away from hemp/CBD advocate and GOP Senate leader Mitch McConnell.
Both the Cannabis Trade Federation(CTF) or NCIA(Natl Cannabis Industry Assn) took credit for the banking bills' passage, downplaying the 6 1/2 year effort put out by key bill sponsors Rep. Denny Heck (D-WA) and Rep. Ed Perlmutter (D-CO). Read an informed analysis of the SAFE bill prospects in the Senate from this Politico report at: https://www.politico.com/news/2019/09/26/marijuana-senate-banking-001391
Opinion Essay by West420: The U.S. vape crisis will cost a short-term decline in overall legal cannabis sales—maybe 15 to 25% -- by the end of the year. No one need point to tampering by illegal THC or e-cig black-market profiteers. Or no need to hope for an immediate CDC/FDA common answer on why more than 600 have fallen to violent, life-threatening lung function sickness. No established, reliable and legal cannabis vaping brand will be protected, even as they continue to blame the black market. This e-cig crisis is a permanent, negative setback for the previously, fast-rising delivery method for THC, nicotine and any other highly-flavored delicious cart.
On Aug. 23, 2019 the first death linked to the U.S. vaping epidemic was reported in Illinois. Now, nine deaths later, the CDC assistant director, Dr. Anne Schuchat, told Congress his week that the deaths are not likely tied to any specific issues with THC or nicotine themselves. The larger retail market thinks to formulation problem causing the life-threatening lung attacks might be coming from some new thickening agent—or some cheap knockoff from the black market--which is being shoved into vapes heading for street sales.
In Oregon, the THC vaping fatality was reported to have been sold through a licensed, legal retail store. Fears from vaping sickness in that state has now reported retail vape sales down over 60 percent. Another major sales decline has been reported in tourist states like Nevada and Massachusetts, according to analysis from New Frontier Data.
Here is why the math is so damaging for the cannabis space. Two years ago, about 18% of all legal MJ sales went to vapes. This summer that number had grown to more than 35 to 40%, based on estimates from HeadSet, a leading dispensary sales data aggregator. While not all the suspected fatalities are tied to THC delivery, it matters little when the entire category will see consumers abandoning running from a product which has gone through a national one-month scare, and the worst may yet be coming. Will MJ retailers take their unsold cartridges and run some super discounts, or responsibly just take them off the shelves, and place into safe storage until more fact come out.
More and more states are stepping up with total bans. Massachusetts governor Phil Baker has declared an emergency, and started sets a four month moratorium on all forms of vape sales. JUUL says it will not fight the Trump administration plan to ban all (non-tobacco) flavored e-cigs, and JUUL will end its complete advertising campaign, even as its CEO Kevin Burns steps down. Walmart, and a plethora of other retailers, will begin to leave the vape retail category completely.
So far, scores of cannabis vape promoters(and local retailers) have said, “Our products are safe”, or made the claim that full, federal legislation (and its supposed regulatory protection) is the answer. Hoping consumers keep up their overall MJ purchase sales amounts—presumably by switching to more flower, more edibles, or more spray options—is just that—hope. We would have preferred these CEOs and PR experts to have taken responsibility for our part of the problem. Teen agers like the idea of vaping—cause everyone is doing it. Many are using vapes to consumer THC mixes, and others are happy to leave cigarettes for another (perhaps slightly-more safe) option of vaping tobacco, rather than burning it.
What causes the two tobacco giants-- Phillip Morris and 35% JUUL-owner Altria to cancel their merger talks? This vaping scare will shake up the marketplace forever. And like it or not-- cannabis oil vaping-- and the rest of the category generally-- are now tied to the larger vape/e-cig scare. Perhaps NCIA, CTF or MPP might like to stop pointing fingers to the black-market boogeyman, blaming the "faceless" illegal market. It's time for our industry to stop-- think-- and come back with some strategic, long-term solutions with the consumer in mind. It's not just going away. And it won't get any easier from here.
A merger of quality leaders-- RE Botanicals' John Roulac, left (also founder of hemp giant NUTIVA) and his new partner, Janel Ralph, co-founder of Palmetto Harmony of South Carolina share an award given out at Expo East. After agreeing to merge in August, the pair of hemp/CBD innovators shared a "NEXTY" award given by the Baltimore Natural Products' expo, Sept. 11. The two companies also were graded an "A" (only 2 of 4 firms) by the Council for Food Safety which conducted a 40-company CBD review of best practices. (PHOTO BY LLOYD COVENS)
CANNABIS News Briefs..... The Arthritis Foundation says 10 to 20MG per day of CBD should reflect a safe beginning dose for releif from pain. A survey of 2600 arthritis sufferers was the basis for a national study, which brought the major association to suggest while more CBD research is needed, consumers also need answer today. AF's senior vice president Cindy McDaniel told Forbes "'the biggest take-away was the number of people who are either using or looking into using CBD, which was 79%... treating pain was number one, along with anxiety and sleep." McDaniel said the Foundation felt " an obligation as an organization to step up and provide as much guidance as we could, working with some of the experts who are doing research on CBD... We need to be cautionary about the legality of THC and also the need to keep the dosage low. But we did make the decision to keep the THC option in,” said McDaniel. Read the full Arthritis Foundation guidance here: https://www.arthritis.org/living-with-arthritis/pain-management/chronic-pain/arthritis-foundation-cbd-guidance-for-adults.php
California's illicit cannabis sales market continues to show little movement to expanding consumer buying from licensed retailers, with another study projecting only about 24% of sales coming from legal channels. The LA Times reports only 873 cannabis retailers are state licensed, compared with almost $2,800 unregulated stores and delivery services, according to a survey by the United Cannabis Business Assocation. The figures would confirm an already dismal collection of state and local cannabis taxes, driven in-part by the combined high MJ tax rate which can top 44 percent in some cities. The UCBA survey would suggest that $8.7 billion will be spent on unregulated cannabis products in California in 2019, compared with just $3.1 billion spent on cannabis sold by legal businesses.
In an effort to revitalize plans for considering RMJ legislation in the tri-state region for 2020, New York governor Mario Cuomo says he will meet with governors of Connecticut and New Jersey to see how they can coordinate their 2020 efforts. All three states failed in 2019 to get the (formerly) expected support to get adult-use bills through their legislatures. Cuomo told a radio host last week that if one of the three states passes more favorable access regulations, then the other state might face increased impaired driving back to the home state. Cuomo also hopes to push for new rules for vaping safeguards, and possibly ask the other two governors to ban combustible flower MJ use.
While new provisions were added to the SAFE banking bill to protect hemp farmer access to banking, the problem of getting crop insurance continues to roil in Washington. Bill Northey, USDA undersecretary for farm production and conservation told a Congressional subcommittee that "insurance products that fairly represent crop risks" are almost non-existent. There is some insurance available for fiber and seed producing aspects, but insurance for whole hemp plants is still rare, and all hemp insurance offerings are finding very steep premiums.
Special Report: As Oct. 1 gets closer, the critical hemp harvest days are upon the farming community. Drying, shipping, processing, storing. All of these and more in our special Oct 4 Farm Analysis. Don't miss it, next week.
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