Dispatch from the Santa Rosa Hall of Flowers 🌷

HALL OF FLOWERS
Cannabis brands descent on Santa Rosa for another year

Hundreds of California cannabis brands and retailers attended Hall of Flowers, the state’s flagship trade show last week, looking to secure new business in one of the nation’s most challenged markets.

Zoom in: In some ways, this year’s installment was emblematic of the California market itself — paired down from previous years with fewer exhibitors and attendees, a reverberation of the widespread financial struggles facing most operators.

Survival has become the prevailing theme in the world’s largest regulated market, highlighted by a much more subdued vibe this year on the showroom floor, after parties, and session meetups. 

What they’re saying: “It’s not 2018 or 2019,” event founder Dani Diamond said. “Whoever is here seems to be here to stay.”

Breeders step into the spotlight: This year, Hall of Flowers organizers added Breeder’s Village to showcase top cannabis growers.

Most breeders have not been fairly compensated for their IP or had it copied, marketed, and sold without their approval, Michael Klein, a longtime cannabis exec said.

“The people closest to the plant and creating the most value are getting rewarded the least,” he said.

Looking ahead: Next month Hall of Flowers will debut its trade show in New York City at Pier 36 in Lower Manhattan. 

“It’s a hot and exciting market,” Diamond told Cultivated. “We have a lot of first timers that are going to launch their product in New York.”

Read Chris’s full story here: Survival is the name of the game at this year's Hall of Flowers.

“This is not a personal fight with the governor. It is a disagreement on extremely important policy,” Texas Lt. Gov. Dan Patrick said in a statement last week responding to the news that Gov. Greg Abbott signed an executive order calling for the regulation of hemp-derived THC in the state. 

“The Governor’s executive order, intentionally or not, has sent a signal to the THC industry that they have a state seal of approval on the current THC market.” 

Patrick’s comments come after his attempts to pass a total THC ban failed three times this year.

LIT ALERTS’ INSIGHTS
Ohio’s first pre-roll movers

In most mature cannabis markets, pre-rolls are one category gaining market share. But pre-rolls weren’t available to Ohio consumers until this summer.

After looking at the first ~30 days of Ohio pre-roll sales data, Lit Alerts shared the early brand movers, the one-sided product availability, and the out-of-the-gate pricing.

Ohio heavyweights Buckeye Relief, Fireland Scientific, CERTIFIED, Aura, and Pure Ohio Wellness have moved first alongside MSO Trulieve's R.O. brand. It's important to note that while most of the top brands have achieved wide distribution quickly, the R.O. brand has almost exclusively been sold through Trulieve retail locations.

Pricing has started modestly, with an average 1g single costing $13.00 retail list while a 5 pack of 0.5g pre-rolls is averaging $37.97 (2.5g total package weight). Infused products are making early noise, already accounting for approximately 15% of pre-roll sales.

It's early days in Ohio for pre-rolls. Expect the competition to get much more intense over the next few months as capacity and demand ramp up.

Which of the multi-state pre-roll brands will take a swing at an early entrant position in Ohio? Time will tell.

For now, have a look at Lit Alerts’ exclusive insights into Ohio’s newly-launched pre-roll market. 👇

To learn more about Lit Alerts and get a special offer only available to Cultivated readers, visit litalerts.com.

California cannabis taxes bring in big money 💸

California generated over $250 million in tax revenue from cannabis sales, according to the state’s Department of Tax and Fee Administration in the second quarter of this year. The second-quarter number is slightly larger than the first quarter, with total revenue this year over $500 million. 

Arkansas medical sales set to break 2023 record 📈

Medical sales in Arkansas are thriving. Arkansans spent about $193.1 million on medical cannabis so far this year, putting the state on target to break the 2023 record of $283 million. The Arkansas Advocate has more.

California shuts down illicit grows in mid-summer raids 👮

State authorities raided five distribution sites, two delivery operations and 10 dispensaries in a series of raids in the latter half of July and early August. The raids resulted in the seizure of 6,472 pounds of illicit flower, 1,145 pounds of concentrates and 5,585 pounds of edibles. The raids also resulted in the seizure of 17 gold bars and 100 pounds of psilocybin mushrooms. 

ACLU and other advocacy orgs support federal legalization 🌿

The American Civil Liberties Union, The Drug Policy Alliance, and other advocacy groups signed an open letter in support of the MORE Act, which would federally legalize cannabis and create community reinvestment funds if passed. “For generations, marijuana’s placement on the CSA has disproportionately inflicted harm upon communities of color and poor people,” the letter reads.

High Tide posts a Q3 profit 📈

Canadian cannabis company High Tide reported $832,000 (CAD) in net income on $149.7 million in revenue for the quarter ending on July 31. The company also reported $7.7 million in free cash flow, up 148% year-over-year. The company showed a rare, profitable quarter in the cannabis industry. Note: High Tide is a Cultivated partner.

Verano Holdings is moving to the USA 🇺🇸

Cannabis company Verano Holdings announced a plan to redomicile the company in Nevada from British Columbia. Despite the move, the company expects to continue trading on Canadian stock exchanges and over-the-counter in the US.

Bright Green Corporation merges with PharmAGRI 📈

Bright Green Corporation is merging with PharmAGRI Capital Partners, creating a new US-focused pharmaceutical company led by Lynn Stockwell as CEO. The venture plans to relist on Nasdaq, expand sovereign “seed to syringe” drug production, and deploy up to 10,000 Tesla humanoid robots to cut repetitive labor while boosting high-wage technical jobs, according to a press release.

Cannabis and driving 🚓

A new study published in the journal Psychopharmacology on cannabis and its effect on driving found that even heavy cannabis users showed no driving impairment after 48 hours of cessation. That's crucial because cannabis can show up in blood tests for weeks after use, as THC is fat soluble — meaning that it’s an ineffective way to measure acute impairment. Read the full study.

High Times is coming back to print, after a long hiatus:

California lawmakers show rare unity in granting cannabis tax cut | SFGate