Next Big Crop’s Managing Director Rich Cardinal discusses the future of the Cannabis industry with Marijuana Venture. Specifically the inevitable drop in costs to produce a pound of cannabis.
To read the full story at marijuanaventure.com, click here.
The Future of Low-Cost Cannabis
BY EMBRACING TECHNOLOGY, WE CAN MAKE THE $100 POUND OF CANNABIS A REALITY.
Rich Cardinal of Next Big Crop predicts the cost to produce a pound of cannabis will drop more than 95% to $100 by 2025.
Cannabis production standards are nowhere near a $100-per-pound price point just yet. But they will be very soon, and well-capitalized, forward-looking operators are now making the investments that will allow them to achieve these low production costs long into the future.
I know we can design and build cultivation facilities to produce cannabis for $100 per pound.
But more importantly, I know we don’t have a choice.
By 2025, or maybe even as soon as 2020, this industry will be based around per-pound production costs in the $100 range, or potentially lower, and companies that can’t compete at that level will be swiftly left in the dust.
Although average warehouse production costs in markets like Colorado and California currently hover around $500 per pound, we’re driving that price point down by working smarter and investing in highly efficient conveyors, automation, trimming and drying technologies, packaging machines and cutting-edge environmental control technology.
WHY $100 PER POUND?
As new markets and increased competition come online, cannabis wholesale and retail prices are rapidly dropping in regulated markets across the country. Many new markets don’t have caps on production capacity, so there’s a lot of competition and a glut of surplus cannabis out there right now.