Each month we spend hours analyzing market research, data trends and private conservations to will keep you in front of the ever-evolving cannabinoid industry. Read the entire July Report here
One Report, Once a Month, Everything you need to know
JULY 2021
A note from Your Partners
As we enter the hot months of summer and celebrate the birth of our great nation, the cannabis & hemp industries continue to mature. This is more prevalent in the cannabis industry, as it seems there’s a new state pushing for adult-use legalization every other week. This breakneck pace has spurred more mature players with bigger and more daring goals to enter the space through acquisitions and strategic partnerships. The size of some of these recent deals have been astronomical. All the while, the hemp industry continues to stagnate as the federal government refuses to approve CBD as an additive. With so much going on, it can start to feel like you’re lost at sea with no refuge in sight, but we look forward to being with you every step of your journey, helping you navigate through any murky waters.
– Kellan Finney
We’re just over halfway through 2021, and the progress the industry has made is astounding. Connecticut has officially become the 18th state to legalize cannabis, the fourth state this year, and 36 percent of the U.S. has now gone green. Even more impressive, three other east coast states (namely RI, PA, and DE) are looking to follow suit. These previously untapped markets will present areas of growth for current operators and outside conglomerates to dominate the space and dive into the green rush. As the industry continues to both expand and consolidate, we’ll be here every step of the way to help you navigate these shark infested waters.
Join the 1,512 others who are receiving high-signal, data-driven analysis to be in front of their peers in the cannabinoid space! If you have found value in our insights, please share this with another canna-curious individual to grow the revolution!
Each month we spend hours analyzing market research, data trends and private conservations to will keep you in front of the ever-evolving cannabinoid industry. Read the entire Report here
One Report, Once a Month, Everything you need to know
The article below is an excerpt from the Monthly Playbook.
Join the 1,512 others who are receiving high-signal, data-driven analysis to be in front of their peers in the cannabinoid space! If you have found value in our insights, please share this with another canna-curious individual to grow the revolution!
Each month we spend hours analyzing market research, data trends and private conservations to will keep you in front of the ever-evolving cannabinoid industry. Read the entire Report here
One Report, Once a Month, Everything you need to know
The article below is an excerpt from the Monthly Playbook.
The marathon in the CBD industry is far from over, as prices and players continue to be volatile. With a large CBD player closing its doors, others operating in the space have a growing opportunity to gain market share. On the other side of the coin, companies manufacturing CBD are twiddling their thumbs, waiting for further guidance from the FDA and USDA, which hopefully will come before the industry is bare bones. Lastly, commodity prices continue to soar. We believe this current environment will allow companies to expand their revenue streams and harness the true versatility of the cannabis plant, whether this involves using the hurd for building materials, the chemical waste streams for commodities, or the phytochemicals for medicine.
Kellan Finney
After the Harvest & Trulieve deal, many industry insiders have called this upcoming month the “summer of canna love.” Will other large MSOs feel the need to quickly respond? Will urgency, the main theme of our May report, play a vital part in next steps? According to our research, the answers to both are a resounding “Yes.” As the industry continues to blossom, we recommend leaning into these feelings of urgency by conducting your own strategic moves during this time of consolidation. Our favorite approach is the smaller scale roll-up, and though it’s not as heavily celebrated or scrutinized as the Trulieve deal, it’s just as crucial to the development of your operations.
Join the 1,512 others who are receiving high-signal, data-driven analysis to be in front of their peers in the cannabinoid space! If you have found value in our insights, please share this with another canna-curious individual to grow the revolution!
Each month we spend hours analyzing market research, data trends and private conservations to will keep you in front of the ever-evolving cannabinoid industry. Read the entire Report here
One Report, Once a Month, Everything you need to know
The article below is an excerpt from the Monthly Playbook.
The Future Of Lumber And Its Effect On Cannabis Consumers – June 2021 Monthly Playbook
At the time of writing this, July 2021 lumber futures are trading at $1540 per contract, which is a 337.5% increase in price from last year. The interesting thing about lumber future contracts is that they include both the finished lumber products, like as 2’ x 4’s for framing houses, along with pulp which is a byproduct of the milling process. The pulp is used to create paper, cardboard, corrugated cardboard, and other consumables. While the housing boom requires finished boards and is driving the price of lumber future contracts up, the pulp industry operates differently.
Typically, only half of the fiber used for paper manufacturing processes is derived sawmill pulp, and the other half comes directly from wood that was purposely harvested for paper. 5,6, The glut of pine trees in the United States is escalating the stock price, helping cushion sawmill margins.
The cannabis industry is heavily reliant on paper products to package and label goods. The main product we believe could be the most effected by the increase in lumber and pulp prices is the pre-roll market. The total domestic market for pre-rolls in 2020 was ~$1.9 billion with ~200 million joints sold in the adult-use markets.
The average retail price is currently around $10.00 for a 0.7 gram cannabis pre-roll.7 If processors experience a 300% increase in packaging cost for pre-rolls (including the rolling paper, filter, packaging, and label), the consumer will most likely have to foot the bill. This spike in pulp pricing will inevitably lead to an increase in price for paper products. Considering the uptick in online shopping this year leading to increased demand for cardboard, we recommend locking in packaging inventory for the summer to avoid any dramatic price increases.
Join the 1,512 others who are receiving high-signal, data-driven analysis to be in front of their peers in the cannabinoid space! If you have found value in our insights, please share this with another canna-curious individual to grow the revolution!
Each month we spend hours analyzing market research, data trends and private conservations to will keep you in front of the ever-evolving cannabinoid industry. Read the entire Report here
One Report, Once a Month, Everything you need to know
The article below is an excerpt from the Monthly Playbook.
**Please note this article is part of a larger series that was first released in the April 2021 Monthly Playbook. If you would like to receive the complete monthly playbook you can sign up here
Part 5: Cannabis Extraction Methods
The separation of the wide array of compounds in Cannabis sativa is becoming more important as regulations on cannabinoid-containing products become more stringent. There are a few common methodologies used for extraction in the cannabis industry.
Depending on the intended final product, incoming processing can include separation of the flower portions with the highest concentration of cannabinoids and terpenes. Then the extraction of the terpenes and the cannabinoids can begin. Though mechanical separation methods exist, this article will focus on the most common solvent-based extractions: hydrocarbon, ethanol and super-critical CO2. Solvent extraction methodologies have been around for millennia since the ancient Egyptians made tinctures by soaking herbs in ethanol. Tinctures are created by putting the herbs into a liquid, usually alcohol, to extract the flavors, healing components, etc.
The basic solvent extraction is based on historical methods, although we have made technological advances to help us control the processes over the centuries. Today, common organic solvents include ethanol [1], butane, and propane.[2] Water extraction will not be covered in this article due to its low yields of cannabinoids and terpenes.
Alcohol extraction uses ethanol and is one of the most common and efficient methods of extracting the cannabinoids. The initial step is to soak the raw material in ethanol to remove the trichomes. The polar end (-OH group) of the molecule helps dissolve the hydrophilic compounds, such as chlorophyll. The non-polar end (C2¬H5) helps to dissolve the hydrophobic compounds such as the plant waxes, oils, cannabinoids, and terpenes.
The process can be done in either warm or cold ethanol. In warm or room temperature ethanol, the cannabinoids dissolve quickly leading to a high yield of cannabinoids. However, the warm ethanol extraction process also dissolves plant lipids including the chlorophyll, which causes a strong bitter taste. By dropping the temperature of the ethanol to less than -30˚C (-22˚F), you decrease the solubility of all the compounds leading to a much slower dissolution of the products into the ethanol. However, it is also below the freezing point of many plant waxes which means that many of the compounds will be solids. The impurities separate from the cannabinoids and can be easily removed.
Hydrocarbon extraction generally uses either propane or butane. Propane and butane are small hydrocarbons, made only of carbon and hydrogen atoms, that are non-polar with low boiling points, (-44˚F and 32˚F, respectively) [3]. The initial extraction washes the raw material with the cold hydrocarbon.
The non-polarity of the molecules helps easily dissolve the cannabinoids, waxes, fats and lipids. Unlike ethanol, there is no polar end to help with the dissolution of certain undesired compounds such as chlorophyll. The terpenes are also easily dissolved in the hydrocarbons, though the flavonoids have limited solubility. The hydrocarbons with the products of interest can be separated by flowing the mixture into a separate area and raising the temperature.[4] With low boiling points, the hydrocarbons evaporate at -44˚F (Propane) and 32˚F (Butane) leaving behind the waxes, fats, lipids, cannabinoids, and terpenes.
After the separation of the hydrocarbons from the extract, the propane or butane can be recirculated though the biomass creating a closed-looped system. The result is an extract that is relatively free of inactive plant matter such as chlorophyll. Hydrocarbon extraction is losing popularity primarily due to regulations for handling propane/butane and stigma attached to a using a hazardous chemical for the extraction.
The final extraction method uses super-critical CO2. Outside the cannabinoid industry, supercritical extraction methods are used for the production of high-quality hempseed oil, extracting caffeine from coffee, removing pesticides from agriproducts, etc. [5] At standard temperatures and pressures (room temperature and sea-level atmospheric pressure), all molecules are in their natural state of matter: solid, liquid, gas, or plasma. One can change the state of matter by changing the temperature or the pressure or both. A good example of this would be creating ice cubes in your freezer. Without changing the pressure, you can turn the water into ice by lowering the temperature.
When modulating the temperature and pressure of a system, liquids and gases can hit a critical point where they exhibit characteristics of both liquid and gas. They take up the entire space (more compressible) like gases and have liquid-like densities. This is called a supercritical fluid.[7] Figure 2 shows the phase diagram of Carbon Dioxide (CO2). Using CO2 has several advantages, it is nonflammable, non-toxic, relatively inert, abundant and inexpensive. [8, 9]
The other main advantage is that at a temperature of 31˚C, you can maintain the supercritical liquid at 74 bar.[6, 7] The various components of cannabis have different solubilities at different temperatures and pressures, thus allowing a clean extraction of the target compounds. However, one study has shown that the concentrations of different products can be extracted at different rates, so the extract should be analyzed. [2, 8, 10]
References:
J. Plotka-Wasylka, M. Rutkowska, K. Owczwarek, M. Tobiszewski and J. Namiensnik, “Extraction with environmentally friendly solvents,” Trends in Analytical Chemistry, vol. 91, pp. 12-25, 2017.
M. May, “The Best Extraction Methods for Marijuan concentrates,” 3 May 2018. [Online]. Available: https://www.analyticalcannabis.com/articles/the-best-cannabis-extraction-methods-for-marijuana-concentrates-300434.
L. G. Wade, Organic Chemistry, 4th Edition, NJ: Prentice hall, 1999.
Marijuana Business Magazine, “Choosing the right cannabis extraction method: Experts weigh in on CO2, hydrocarbon & ethanol,” Marijuana Business Magazine, 2018.
Le Portail Des Fluides Supercritiques, “Applications,” Le Portail Des Fluides Supercritiques, [Online]. Available: http://www.supercriticalfluid.org/Applications.149.0.html.
M. Ollero and D. Touboul, “Lipidomics by Suprictical Fluid Chromotography,” International Journal of Molecular Science, vol. 16, no. 6, 2015.
P. Atkins and J. de Paula, Physical Chemistry, 7th Edition, Oxford Univerisity Press, 2002.
C. L. Ramirez, M. A. Fanovich and M. S. Churio, “Cannabinoids: Extraction, Methods, Analysis, and Physiochemical characterization,” Studies in Natural Products Chemistry, vol. 61, pp. 143-173, 2019.
Airgas, “Safety Data Sheet – Carbon Dioxide,” 12 February 2018. [Online]. Available: https://www.airgas.com/msds/001013.pdf.
A. Beadle, “Advances in Cannabis Extraction Techniques,” 25 June 2019. [Online]. Available: https://www.analyticalcannabis.com/articles/advances-in-cannabis-extraction-techniques-311772.
