Yesterday, three US states voted to legalize recreational marijuana. Casual smokers in Massachusetts, Nevada, and California are now free from the social stigma–and threat of jail time–that had clouded cannabis use for decades. (Maine is still up for grabs; Arizona voters kept the status quo.) In these states, downlow smokers will become legal consumers, and formerly clandestine growers and sellers will start responding to the demands of bona fide mass market.

Consumer demand is responsible for widely salable wonders like the Big Mac, Budweiser, and Granny Smith apples. It also supports copious bespoke industries like craft beer, Etsy, and the cupcake industrial complex. So, an open market is probably going to force a range of changes on the cannabiz. If it happens, it will be most apparent in California, with its huge population and extant cannabis culture.

“Obviously, California is a large enough market where those problems aren’t very big hurdles,” says Taylor West, deputy director of the National Cannabis Industry Association. The state has 40 million people, 50,000 pot farms, and a medical marijuana industry worth $815 million in 2015. But the state’s law includes a five year moratorium on outdoor farms bigger than an acre. Which won’t hold off Big Jane for long. Five years is pretty negligible for anyone looking to become, say, the Phillip Morris of cannabis. After the moratorium expires, don’t be surprised if you start seeing hundred-acre pot operations pop up in the state’s ample ag regions.

In this way, the weed industry might look like the wine business. California’s climate and soils support homogenized vines that grow grocery jug staples like Carlo Rossi; as well as some of the world’s most coveted vintages. “Just like we see in the microbrew and wine industries, there will always be a place for craft, artisanal, and small market flavors,” says Tawnie Logan, executive director of the Sonoma County Growers Alliance. Her organization, however, opposed California’s now-law. “The problem is how many of these things can compete on a shelf.” After the size moratorium ends, she fears that market forces will edge out many of the state’s growers. “Homogenization and consolidation are absolutely the corporate model, as are reducing variables, lowering costs, and increasing profits,” she says. “The market will be too cutthroat for many small farmers to survive.”

In some ways, that’s to be expected. Whatever your opinion of Budweiser (and by extension, the masses), it and other megabrews won the market by playing to the public’s appetite for consistency. The same forces explain how American orchards went from growing hundreds of apple varieties a century ago, to just a half dozen or so today. “That creates a lot of competition on things beyond just price,” says West.

Not everyone sees such forces as a negative. “I think the open market will accelerate innovation and increase the diversity of strains,” says Sean Donahoe, a policy advisor for the California Growers Association. In his view, if anything gets standardized, it will be the process of showing where the weed came from, and what to expect when you smoke it. “There should be greater transparency of the product’s content, how it moves through the supply chain, and seeing what was cultivated, when, and by whom.”

In the smaller states, which also have more aggressive grow limits, expect small farms to keep pouring out a potpourri of strains. That is, unless the feds act. For the past few years, the DEA has been acting curiously thoughtful about its hard stance against cannabis. Earlier this summer, it announced that it would make it easier for researchers to access the plant. California’s legalization affects so many Americans that the agency has little option but to respond in some way.

Whatever happens, expect the cannabis business to keep growing, baby.

25 Comments

  1. brianreilly

    It should be pretty interesting. Anyone with a few square feet of floor available, and a couple hundred dollars can grow as much weed as most people will ever want to smoke, and the cost (and effort after set up)is nearly zero. One cannot do that with beer, or spirits, not as easily. Mass market weed is going to have to be very inexpensive to compete with free.

    There will always be a gourmet market, but if American ingenuity and greed are as strong as I think they are, home grown weed, (cheap and of as high a quality as one would want) is going to be the price point leader.

  2. “Not everyone sees such forces as a negative.” – Only people who don’t want don’t understand that efficiency and progress is a good thing see this as a bad thing.

    Increased efficiency and innovation is ultimately why we now live in such luxury compared to a hundred years ago. It means that more people can afford it and less resources is wasted. And as the craft beer boom proves; there will be room for “artisanal” for people who are willing to pay a premium.

  3. I’ll say one thing—you can grow a boatload of weed on just an acre. One full grown skunk plant, grown naturally under the sun, can produce as much as 5 pounds of buds…they can get huge. One acre could probably support tens of thousands of reasonable smokers… The market will be absolutely flooded in short order…which is great. There is really no reason why bud prices can’t drop to a few dollars an ounce….even using sea of green with (old style…not LED…) lights can produce weed at like 1-2 dollars an ounce…..if you don’t believe me, do the math. That is, of course, discounting the labor value, but still….some of the medical shops (and street dealers) are charging 300-400 ounce. Think about 3-4 dollars… If there is such a thing as a “free market” bud prices will be on par with strawberries…there is no reason why not.

  4. unstoppable superninja

    It would take that many to afford the rent out there.

  5. And you’ll have to contend with the fact that the Donald will totally shake things up. I hope you’re ready for the ride.

  6. disqus_t_ing

    Exactly. Trump has even stated he’s never touched alchohol, tobacco or any drugs, ever. He instilled that in his kids also. If peeps think it will just. E status quo, I suspect they’re in for a rude awakening.

  7. SuperMarina

    As the op said, it is ‘ok to not use drugs’! I think that is something everybody needs to know, no matter what they chose to do themselves. Republicans winning the election has not voided free will.

  8. Mitt Zombie

    Purity standards for tobacco? They allow everything in it, trade secrets, don;’t even have to list harmfull additives.

  9. Mitt Zombie

    It was probably funny for you watching your drunk dad beat up your mom in front of you too.

  10. Mitt Zombie

    There is a limit, its 12 plants in MA, might be 6 per house in CA.

  11. We now have a republican president, an ultra right wing vice president, a right wing senate, a right wing house and, soon, a right wing supreme court. Weed is still illegal at the federal level. How long does anyone really think it’s going to take before the feds step in and say “yea… not so fast?”

  12. I’m just saying: knowing that I’m so susceptible to a minor thing like tea, which has caffeine, yes, but also three other psychoactive compounds, I don’t even want to try weed. I’d be a space cadet in no time.

  13. There are already growing standards in CO, and they are testing. Currently, we are working to get pesticides out of weed. The legally sold weed is more expensive than the illegal guy on the street corner, but the quality is so much better.

  14. Though, people surrounding Drumpf have absolutely said they will crack down on legal weed. That fat bastard Chris Christie straight up told us in CO that he will enforce Federal laws starting January 2017. Christie has stuck by Drumpf, and will be rewarded with a powerful spot. Legal weed may very well be in jeopardy.

  15. Unfortunately, he has a point, kinda. Look at who was on stage with Drumpf last night, Chris Christie. Fat Bastard told us good folks in CO that he will enforce federal law starting January 2017. Weed is NOT legal according to the Feds. So, we have a situation where Repugs will be gleeful hypocrites and stomp on states rights.

  16. I don’t smoke/consume weed…so I don’t have a vested interest in this. That said, some USDA/FDA oversight could be a good thing. The chemicals/pesticides used on illegal grows are pretty f-ing scary (especially when you consider how many people are smoking the chemicals as opposed to ingesting, where at least your stomach acid gives you a fighting chance).

    Also, testing in states like Washington where recreational is already legalized has revealed that many growers are still using pesticides that are illegal and banned under their legalized weed schemes. A lot of these state governments simply aren’t prepared to regulate (and/or don’t have the resources) to regulate and test the crops.

  17. Well that would certainly be a logical conclusion, but this election has proven anything but logical. Also, upon Trump’s election, some private prison stocks surged: http://www.bloomberg.com/news/

    So there’s at least some investors that are betting on the industrial prison complex (and I’m sure they’re not real discriminate with the types of prisoners…so long as prisoners are filling those jail cells). Anyway, if I were a weed investor I’d be taking a wait and see approach for at least 6 months to see if the new republican regime will take a hands off approach, or opt to fill the prisons (and coffers) of our bullshit privatized jail system.

  18. Corporate Serf

    I don’t recommend it unless you have a secured yard. Theft will still be an issue until legal weed proliferates, especially from those who cannot purchase it legally (i.e. teens).

  19. Jeremy Given

    Brownie? The dank stuff is more than welcomed in mi casa. Everyone likes weed, so the fact that the 1930’s weed propaganda laws lasted this fawking long is ridiculous. Weed was only made illegal because some rich guy who owned paper mills spread rumours that blacks were smoking weed and raping white women because of the devil weed….. he made this up so that paper would not be replaced with cheap hemp. If hemp was accepted then he’d go bankrupt so he made people believe that black jazz musicians were out to seduce white women while high. After black slavery this was America’s biggest shame.

  20. Raymond Chuang

    But it also means the likely coming of USDA and FDA standards for growing cannabis. And that will send the price of growing cannabis through the roof if you’re going to do it on a commercial scale.

  21. If you have ten adults over 21 years old… yes.

  22. harley art.us

    marijuanabeer.us

    This writer saw all this coming years ago..hope to endorse marijuana beer with my .us (marijuanabeer.us) logo

  23. unstoppable superninja

    So that’s like 60 plants per backyard in some of those houses.

  24. so you never tried it, but because you drank Tea that has an upper in it and felt energized, the exact opposite of marijuana, you know exactly what it will do to you if you should ever try it?

    You sound pretty smart.

  25. A lot of studies? lol… name one.

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