Tag Archives: control

National Ag Day: An Interview with Industry Leaders Disrupting Agriculture in Positive Ways

By Aaron Green
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National Agriculture Day (March 23, 2021), is an annual event held by the Agriculture Council of America (ACA), a not-for-profit 501-c (6) organization, to increase the public awareness of agriculture’s vital role in our society.

The ACA believes that every American should:

  • Understand how food and fiber products are produced.
  • Appreciate the role agriculture plays in providing safe, abundant and affordable products.
  • Value the essential role of agriculture in maintaining a strong economy.
  • Acknowledge and consider career opportunities in the agriculture, food and fiber industry.

We investigated how the hemp and cannabis industry is disrupting agriculture in positive ways, from automated trimming, to controlled environment agriculture, to water conservation and beyond. We interviewed Aaron McKellar, CEO and President of Eteros Technologies, parent company of Mobius Trimmer and Triminator, Mark Doherty, Executive Vice President of Operations, urban-gro, Inc. and Derek Smith, Executive Director at Resource Innovation Institute (RII) to get their perspective on agricultural innovation.

Aaron McKellar, CEO and President of Eteros Technologies

Aaron Green: Why is hand-trimming inefficient at scale?

Aaron McKellar: Hand-trimming is inefficient at scale because it is so labor-intensive and time-consuming, not to mention repetitive and frankly boring. It’s hard to stay fully engaged as a worker trimming by hand, so the consistency of your finished product isn’t reliable with a crew of hand-trimmers.

Aaron McKellar, CEO and President of Eteros Technologies

A hand-trimmer can produce good quality trim on about 2 or 3 pounds per day. A scaled-up facility running just one Mobius M108S Trimmer can realize up to 120 pounds per hour, replacing many dozens, or even into the hundreds of hand-trimmers. The HR nightmare this presents, and all the associated costs of paying and facilitating dozens of employees (parking, washrooms, lunchrooms, PPE and gowning, etc) is simply unworkable. And that’s before COVID.

Green: How does automated trimming benefit large producers and how does the quality compare to hand-trimming?

McKellar: Not all automated trimmers are created equal. Any of the machines out there will help to reduce the need for hand-trimmers by taking off the bulk of the leaf, leaving a small team of “hand-polishers” to finish it up. The Mobius Trimmer is the only automated trimmer on the market today that leaves the technology of the original machines in the past and employs next-gen technology to truly mimic hand-trimmed quality with stunning through-put rates.

We have high-end producers using Mobius Trimmers whose own QC department cannot discern Mobius-trimmed flower from hand-trimmed flower. Hand polishing crews tend to be far smaller when using a Mobius vs first-gen machinery, and many Mobius users don’t touch up at all, instead going straight to market right out of the trimmer. For a look at how our technology differs from the rest of the field, check out this look under the hood.

Mark Doherty, Executive Vice President of Operations, urban-gro, Inc.

Aaron Green: What is controlled environment agriculture?

Mark Doherty: Cannabis cultivators understand growing indoors because, prior to legalization, they had been doing it for years in the gray market. It is by way of that experience that cultivators learned how to manipulate a highly-valuable, complex plant in an indoor setting. As cannabis legalization spread across the United States, many government regulators required that it be cultivated indoors according to strict regulatory protocols. Fast forward 10 years, and we have an industry that is keenly aware of the indoor environmental conditions required to be successful. Critical factors like heating, cooling, ventilation, dehumidification, and how to best mimic Mother Nature’s energy through lighting are all deliberately optimized.

Mark Doherty, Executive Vice President of Operations, urban-gro, Inc.

With cannabis cultivation driving the advancements of controlled environment agriculture, market and regulatory forces demanded higher efficiency, reduced energy and resource consumption, and clean crops. In most states, cannabis crops have more stringent testing than food crops. For instance, the lettuce in Massachusetts will not pass the standards for cannabis in Massachusetts. It’s through rapid innovation and technology adoptions that the cannabis industry has paved the way for lettuce to be profitably grown indoors.

Green: How can controlled environment agriculture help alleviate supply chain stresses?

Doherty: By growing food closer to the consumer, you reduce food miles; meaning, that link in the food supply chain gets a lot shorter and is less prone to disruption. Whether you have hyper small cultivation facilities on every street corner, or a larger cultivation facility geographically close to consumers, you can grow 24/7/365. Furthermore, growing locally allows for better prediction of facility output—10 boxes of greens on Monday, 50 boxes of greens on Tuesday, and five boxes of greens on Thursday. This eliminates harvesting a large crop before it is ripe and likely requiring cold storage. The controllability of controlled environment ag is that consistent, reliable contribution to the food supply chain and shortening that path to the consumer.

Derek Smith, Executive Director at Resource Innovation Institute (RII)

Aaron Green: What motivated you to publish the Cannabis H2O: Water Use and Sustainability in Cultivation report?

Derek Smith, Executive Director at Resource Innovation Institute (RII)

Derek Smith: Until this report, if you searched for cannabis water usage, you’d basically find one cited statistic. It was “six gallons per plant per day.” We knew this was from a model based on one extreme illicit market scenario. Based on the data we were seeing and the conversations we were having, this number seemed way off. So, we pulled together a multidisciplinary Water Working Group as part of our Technical Advisory Council. The objective of the Water Working Group was to establish a scientific understanding of how, and how much, water is used for cannabis cultivation so that cultivators have confidence in taking steps to be more efficient, and so that industry leaders, governments and media can be accurately informed about the range of water practices of today’s regulated market.

Green: What key points should cannabis cultivators take away from the report? What key points should regulators and policymakers take away from the report?

Smith: As the cannabis industry matures, water use efficiency will become more important, as it has for other agricultural crops. Pressures to use water efficiently will mount from multiple channels including – reducing input and energy cost, protecting the environment, meeting regulatory standards and simply being good stewards. We recommend that industry and regulators focus efforts on the following areas:

  1. When grown outdoors, water for cannabis production should be assessed like any other agricultural crop and be subject to state and local regulations that apply to other crops. Our research indicates that cannabis neither uses a massive share of water nor uses more water than other agricultural crops. Applying the same standards to cannabis as to other agricultural crops will correctly categorize outdoor grown cannabis as an agricultural crop.
  2. In areas where there may be conflict between water use for cannabis and environmental concerns, regulators and the industry should focus (1) on the timing of water use and (2) the potential of storage to mitigate environmental conflict. Our results show that in many parts of the country legal cannabis farmers have ample water storage to satisfy their needs. In areas where storage is insufficient, increasing storage should be a priority for farmers and regulators.
  3. Our research shows there are still massive differences between cannabis production techniques. As farmers continue to experiment and improve, we expect to see water use be a more important part of cannabis farming decisions and expect new plant varieties and growing techniques to be developed that increase water use efficiency. Yet more data from actual farms and facilities are needed to point the way toward the technologies and techniques that drive optimal efficiency and productivity. It is recommended that producers benchmark their performance and governments consider requiring energy and water reporting by producers. The Cannabis PowerScore can assist in these efforts.
  4. As indoor production continues to grow, especially in areas that have unfavorable climatic conditions for outdoor growing, we expect more cannabis users to rely on municipal water sources. Yet, it is unclear if municipal water suppliers are equipped to work with the cannabis industry. We suggest outreach efforts between the cannabis industry and municipal water suppliers to incentivize efficiency where possible.

Is Your CBD Product Verifiably Natural?

By Jordan Turner
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Natural product analysis using Carbon-14 is a valuable scientific tool that can be used to confirm the naturality of cannabidiol-based (CBD) ingredients by verifying the percentage of a product that is obtained from naturally-sourced ingredients. Determining the percentage of biobased content in a product allows companies to ensure their CBD ingredients are truly natural-derived, identify the presence of synthetic adulterants, and authenticate marketing and “natural” labeling claims.

Why consider natural product analysis using Carbon-14 to validate your natural CBD products?

Carbon-14 is an isotope present in naturally-sourced materials. Natural product analysis measures the percentage of Carbon-14 present in an ingredient or product. Higher percentages indicate that a product is primarily or completely made with natural-sourced ingredients as opposed to synthetic, petroleum-derived alternatives. These cheaper, synthetic alternatives created from petroleum-based sources cannot be measured using Carbon-14. A product that is all-natural and completely plant-sourced will show a result of 100% biobased content whereas a low or zero percentage will reveal a product that is partially or completely formulated with synthetic adulterants.

The structure of cannabidiol (CBD), one of 400 active compounds found in cannabis.

Why should you be concerned with verifying the naturality of your CBD products? In recent years, the popularization of CBD extract has increased its demand as an ingredient in personal care and cosmetic products. Higher costs associated with the use of natural CBD extract instead of artificial extracts leads to the use of adulterated ingredients by some manufacturers or false label claims that a product is natural when it is not.

How can you prove your products are the real deal and ensure your customers are sure they’re getting the natural ingredients they expect? Artificial ingredients derived from petrochemical sources do not contain any carbon-14 content. The results of natural product analysis reveal the percentage of a sample that is procured from natural sources, allowing manufacturers and quality assurance teams to confirm their CBD ingredients and products are not synthetic or adulterated and to strengthen claims that their product is truly natural-derived.

Natural product analysis can authenticate the natural content of your CBD products. Validating naturality with Carbon-14 testing strengthens label and marketing claims and confirms your products and ingredients are completely natural and do not contain cheap synthetic adulterants. By verifying the percentage of our product that comes from natural sources as opposed to artificial, petrochemical sources, you can guarantee your product is genuinely made with natural CBD extract.

Learning from the First Wave Part 2: California’s Cannabis Supply Chain and Vertical Integration, with a Grain of Salt

By Todd Feldman
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Part One of this series took a look at how the regulated cannabis market can only be understood in relation to the previous medical market as well as the ongoing “traditional” market. Part Two of the series describes how regulation defines vertical integration in California cannabis, and conversely, how vertical integration can address some of the problems that the regulations create. But first:

A Grain of Salt

Take the conventional wisdom about vertical integration with a grain of salt. Expected benefits may not materialize under the current circumstances:

  • Overall, the business environment is highly challenging due to extensive regulation, over taxation, insufficient retail capacity and competition from the “traditional” market. As a result, integrating businesses upstream or downstream may mean capturing losses, not profits.
  • The three major types of cannabis activity span three major industrial sectors: raw materials (i.e., cultivation), manufacturing and service (distribution, testing and retail). As a result, a vertically integrated company needs to carry out very different types of activity, which require very different types of core competencies, equipment and facilities.
    • Developing core competencies is especially challenging because each of the major cannabis sectors is still evolving.
    • Realizing the benefits of vertical integration requires an additional core competency in cross-sector operations.

 Regulations Define the Supply Chain

California’s regulations define the cannabis supply chain by defining both the individual links (licensees) and the relationships between those links. Therefore, an understanding of vertical integration must be grounded in an understanding of the underlying regulatory definitions.

The regulatory definition of each link is extensive. For example, each licensee is tied to a specific facility, and must have its own procedures for production, inventory control, security, etc. When the links are strung together, this definition tends to preserve operational redundancies, and impede operational integration.

Overall, the relationships between the links are primarily defined in terms of preserving the chain of cannabis custody. On top of that, regulations define very specific (and very consequential) links between certain licenses, as discussed below.

A Taxonomy of Links

There are currently 26 types of cannabis license in California, 25 of which can be vertically integrated:

  • Cultivation – 14 licenses, including 4 sizes each for Indoor (up to 22,0000 sf), Mixed Light (up to 22,000 sf) and Outdoor (up to 1 acre), as well as Nursery and Processor (drying, trimming and packaging/labeling). Note that cultivation licenses are the only licenses that restrict the scale of activities.
  • Manufacturing5 licenses, including volatile extraction, non-volatile extraction, everything but extraction (i.e., infusion) and packaging/labeling.
  • Testing (Type 8), for testing cannabis according to state standards prior to sale. The owner of a testing license cannot own any other type of license.
  • Distribution (Type 11), acts as the gateway between cultivation and manufacturing on the one hand, and retail on the other. The distributor’s gateway status is entirely an artifact of regulation – cannabis must be officially tested before it is sold to a consumer, and only a distributor can order the official test. All products must stay in a “quarantine” area at the distributor until they pass testing. Products that fail testing must be destroyed if they cannot be remediated.
  • Transport (Type 13), which can move cannabis between licensees (with a narrow exception). This license does not allow for official testing.
  • Storefront Retail (Type 9), which is the best license to have, and the hardest one to get.
  • Delivery Retail (Type 10), for delivery services that are subject to the vagaries of software platforms and the intransigence of local authorities.
  • Microbusiness (Type 12), which allows the licensee to carry out cultivation (up to 10,000 square feet), non-volatile manufacturing, distribution and retail.
  • Event Organizer

Self-Distribution – A Case of Useful Integration

You may gather from the previous section that shoving a gratuitous and mandatory distributor into the middle of the supply chain creates problems for cultivators and manufacturers. Savvy operators solve this problem by getting a distribution license. This allows the cultivator or manufacturer to:

  • Pick the time and place for the testing of its cannabis products.
  • Avoid paying someone else for the storage of cannabis products as they await test results or purchase.
  • Reduce transport costs (particularly if the distributor is near the other operations).
  • Sell directly to retailers.

The bottom line is that vertical integration in California cannabis is useful as a means to an end, as opposed to an end in itself. Therefore, cannabis operators should carefully consider how vertical integration will benefit their core business before incurring the risks and expenses associated with an additional license.

This article is an opinion only and is not intended to be legal advice.

The Craft of Extraction: Like Beer Making, It’s All About Control

By Jeremy Diehl
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Any brewmaster from the more than 7,000 U.S. craft breweries will tell you one of two things: That their art is a science, or that their science is an art. The answer might depend upon the brewer’s individual approach, but a combination of experience, process, precise measurement and intuition is exactly what’s required to create great beer. In a very similar way, the cannabis industry has its own version of the brewmaster: Extraction technicians.

A cannabis extraction technician deploys knowledge from multiple science disciplines to apply industrial solvents, heat and pressure to plant matter through a variety of methods with the aim to chemically extract pure compounds. Extraction techs use their passion for the cannabis and hemp plants, combined with chemistry, physics, phytobiology and chemical engineering to help create a result that’s not quite art, but not quite completely science. By manipulating plant materials, pressure, heat and other variables, the extraction technician crafts the building block for what will become an edible, tincture or extract.

Similarly, brewmasters use their knowledge of multiple science disciplines like chemistry and microbiology, as well as different brewing processes and a variety of ingredients to develop creative recipes that result in consistent, interesting beers. The brewmaster’s work is both science and art, as well. And they also manipulate plant materials, pressure, heat and other variables to achieve their desired results.

Author Jeremy Diehl collects cannabis extract from equipment for testing

“I would certainly consider brewing to be an art and a science, but it takes a very disciplined approach to create consistent, yet ever evolving beers for today’s craft market,” says Marshall Ligare, PhD. Research Scientist at John I. Haas, a leading supplier of hops, hop products and brewing innovations. “We work to ensure brewers can create something different with every new beer, as well as something that helps create an experience as well as a feeling.”

In both brewing and extraction, the art comes in the subjective experience of the craftsman and his or her ability to curate the infinite possibilities inherent in each process. However, both are a science in their requirement of establishing production methodologies that guarantee a consistent, reliable product experience every time to win customer loyalty (and regulatory compliance). In the same way hops determine recipes for beer flavors, the cannabis plant determines extraction recipes, especially considering the role that terpenoids play in the quality, flavor and effects of the end product.

The development of new and appealing cannabis products is beginning to mimic the vast variety of craft beers now found all over the world. In the same way beer connoisseurs seek out the perfect stout, lager or IPA, discriminating cannabis consumers now search for that gem of a single-origin, specialty-strain vaporizer oil or irresistible dab extract.

“I see an exciting new day for quality-focused, craft extraction that tells a story, not only of where the cannabis plant might have been grown and how, but also the care that was taken in the processing of that strain into smokable or edible oil,” says John Lynch, Founder of TradeCraft. “Imagine the impact in the marketplace when product-makers figure out how to do seasonal one-offs where engaged connoisseurs are willing to pay a premium for the art behind limited releases.”

In the same way hops determine recipes for beer flavors, the cannabis plant determines extraction recipes

In either process, you’re essentially creating art with science. Each process works with different strains. Each is concerned with chemical and flavor profiles. Each has its own challenges. In both worlds, quality depends upon consistency. You’re creating art, but you need to replicate that art over and over – which can only occur with strict control of the process. Brewmasters seek control of things like yeast quantity and health, oxygen input, wort nutritional status and temperature, among other things. In their pursuit, extraction technicians seek to control temperature, pressure and flow rate–as well as all the ways these variables interact with each other. What enables this control in both efforts is the equipment used to achieve results.

“A modern brewhouse is very much like a scientific laboratory,” Ligare says. “Brewers treat their setup with the same care and attention a scientist gives to their lab equipment, and are equally concerned with precision, cleanliness and the purity of the result. With each new beer, they want to develop a process that can be controlled and replicated.”

The key to creating a precise process is to use instrument-grade extraction machinery that performs to specifications – and allows you to repeat the process again and again. The value of using high-quality instrumentation to manage and monitor either the brewing or extraction process cannot be overstated. Although it seems counterintuitive, this is where the “craft” comes into play for both brewing and cannabis extraction. Precise instrumentation is what allows the brewer or extraction “artist” to manipulate and monitor the conditions required to meet recipe standards. Along with the quality of the ingredients (hops, cannabis, hemp, etc.), the quality of the equipment utilized to create the product is one critical element impacting the end result. “Imagine the impact in the marketplace when product-makers figure out how to do seasonal one-offs where engaged connoisseurs are willing to pay a premium for the art behind limited releases.”

In cannabis extraction, a second crucial decision is determining which solvent is the best solution for the recipe you’re using and the end result you’re hoping to achieve. This decision is a part of the “craft” of extraction, and determined according to a combination of criteria. There’s no question that each solvent has a business case it serves best, and there is ongoing debate about which approach is best. But overwhelmingly, the solvent that best serves the most business needs is CO2 due to its inherent versatility and ability to have its density tuned to target specific compounds.

“Control is what makes or breaks any craft product,” says Karen Devereux, Vice President of Northeast Kingdom Hemp. “We’re based in Vermont and love how Vermont is known for its quality craft beer, cheese and maple syrup. We wanted to bring that craft approach to hemp extraction, and everyone knows that any craft endeavor is focused on the details and getting them right again and again. You can’t do that without controlling every aspect of the process.”

Greater control of the process can also open up worlds of discovery. The inherent “tunability” of CO₂ enables the extraction technician to target specific compounds, enhancing the potential for experimentation and even whimsy. This can lead to entirely new products much in the way a brewer can control his process to create new, interesting beers.

American portrait photographer Richard Avedon famously declared that art is “about control,” describing the artistic process as “the encounter between control and the uncontrollable.” The same can be said for beer making and cannabis extraction. The more precisely you can control variables, the more options you’ll have for yourself and your customers. The more choices you’ll have with regard to different recipes and products. And the more loyalty you’ll ultimately generate among fans of your products.

Green Mill Supercritical: An Interview with CEO Wes Reynolds

By Aaron Green
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Carbon Dioxide (CO2) extraction is a processing technique whereby CO2 is pressurized under carefully controlled temperatures to enable extraction of terpenes, cannabinoids and other plant molecules.

Green Mill Supercritical is a Pittsburgh-based manufacturing and engineering company focused on cannabis and hemp extraction. The company offers a range of CO2 extraction equipment where users can tune and control their extraction methods.

We spoke with Wes Reynolds, CEO of Green Mill Supercritical. Wes recently joined Green Mill as CEO and investor in the company after a long career at the Coca-Cola Company in senior sales and general management roles.

Aaron Green: Wes, thank you for taking the time to chat today. How did you get involved in Green Mill?

Wes Reynolds: I came out of a 20-year career at Coca-Cola, where I lived and worked around the world. I was a sales and general management guy with Coke, and learned a lot about running businesses and how to drive growth. I left Coke in 2017. After that successful career I wanted to be in the cannabis space. I felt like cannabis was a growing space with a lot of opportunity and a lot of misperceptions out there, particularly around the foundations of what I would call the “evil reputation” of cannabis. I just found that abhorrent and wanted to be part of changing it.

Wes Reynolds, CEO of Green Mill Supercritical

So I ran the Florida operations for Surterra, which is now called Parallel, for a year out of Tampa, and we did a great job of growing that business in Florida. As the president of the Florida operation for Surterra, I saw everything seed-to-shelf for the industry. We had a 300,000-square-foot greenhouse in Central Florida, we had dispensaries, we had all the production, distribution and all the marketing. I was really able to learn the industry top to bottom.

When I left Surterra, I started looking at various investment opportunities and thinking about what I might want to do next. I came across Green Mill out of Pittsburgh, and was really impressed with the technology that they had put together. Having run a company where we used CO2 extraction, I had experiences with systems that didn’t work when they were supposed to or didn’t work the way they were promised, which led to lots of downtime, lots of frustration and lots of babysitting. I was impressed with Green Mill’s engineering approach and decided that I’d like to be involved with them. I originally considered just being an investor, but more and more conversations led to a greater understanding of some basic business administrative needs that they had as well. One thing led to another and I agreed to come on as the CEO, and I’m also an investor.

I’m excited about what we’re doing at Green Mill. I think that bar none, we make the best supercritical CO2 extraction equipment out there. We continue to innovate on that every day. We want to push CO2 beyond known limits, which is our stated goal as a company. We believe in CO2 and we’re living our goal in that we really are pushing it beyond known limits. There are new things we’re uncovering every day where we go, “Oh, my God, I didn’t know we can do that with CO2!” So, that’s kind of fun.

Aaron: Can you tell me just a high-level overview of how CO2 extraction works?

Wes: A supercritical CO2 extraction system is a collection of extraction vessels and fractionation vessels or collection vessels. In our case fractionation because we’re doing multiple collections through a single run. Then you need a system of pumps and valves and tubing, etc. to move the solvent in a supercritical state through the packed biomass, and then move the extracted compounds into a set of collection vessels. It sounds very easy. But the key to supercritical CO2 extraction is controlling temperature, flow rate and pressure. The better you can control temperature, flow rate and pressure, the more precise of an outcome you’re going to get. For example, say you run a three-hour extraction run, and you want to run it at 3500 psi. Well, you know, a competitive system might fluctuate 300 to 400 psi on either side of 3500. Whereas our system currently fluctuates more like five to 10 psi on either side of the 3500. So, there is much more control and precision.

Our whole goal, when we’re talking about pushing CO2 beyond known limits, is how do we continue to chase that holy grail of perfect control of temperature, flow rate and pressure? One of our advances so far is a proprietary pump, for example, that’s a liquid displacement pump that we engineer and build. It ensures a very even and consistent flow, independent of the pressure setting. So, that flow rate doesn’t change in our system compared to what you would see with another system. It sounds like a minor thing, except that at the end of a run, if you expected to get a certain set of molecules, you’re going to get a different set of molecules if your temperature and flow rate and pressure are varying, because what you’re doing is disrupting the density of the CO2 as it flows.

It’s about building a system that is precise in that way, I think, that requires enormously skilled engineering effort and design effort on the front end, and then requires us to have advanced production and manufacturing capabilities in our shop in Pittsburgh. Our customers are clearly impressed with the levels of consistency that they’re getting out of their system.

Aaron: You talked about precision and consistency as two items. Is there anything else that makes Green Mill different?

Wes: I’m a brand guy. I believe in brands. I came out of a 20-year Coca-Cola career.

The way that the cannabis industry is going in total, in my opinion, is the consumer is going to get more and more discerning along the way. Up until this point, everybody thinks “oh, we have THC and CBD and we have intensity.” But the more sophisticated and educated consumers get, the more discerning they’re going to be about what products they want to put in their bodies.

What makes Green Mill different is that we’re building a system that allows the operator of that system to create differentiated products for the marketplace. So, it’s not simply “CBD is CBD.” It’s: what plant did you start with? How can you maintain as many of the characteristics of that plant as possible?

We’re going to create the most sophisticated tool possible to allow the operator to create products that can be differentiated in the marketplace for a discerning consumer at a premium price. That way, you can create a market where there might not have been a market before, instead of just “hey, I’ve got X pounds of biomass that I need to extract. Give me your bluntest instrument and let me extract.”

Green Mill Supercritical’s SFE Pro

We currently make five different systems. First is the SFE Pro. We make a seven and a half liter and a 10-liter version, with two-vessel configurations of each of those. Then we have what we call a Parallel Pro, which has four 10-liter vessels and two pumps, with two streams running parallel to each other and emptying into shared collectors. It doubles the extraction rate, and you don’t expand the footprint very much. But 10-liter vessels are the biggest vessels we use. Because when you go too large with the vessel, you are giving up something in terms of the ability to control temperature, flow rate and pressure. Your efficiency starts to drop with higher vessel volume.

One of the things that makes Green Mill different is our extraction rate. Our Parallel Pro can do 145 pounds a day of biomass. We think that’s a significant amount, given the demand that’s out there for unique products. What we’re advocating for is multiple extraction systems instead of giant permanent installations of extraction systems, that end up limiting your flexibility. Big systems also prevent you from creating redundancies in your operating system. So, when your extraction system goes down, you’re done. Versus in our universe, we would say, you might want to have three or four extraction systems in different locations, running different products. Our price points are such that that’s very doable.

Aaron: How does the breakdown look between your cannabis and hemp clients?

Wes: A lot of that is legislative frankly. It has to do with what the environment is like at the moment. About 60% of our customers are small hemp farmers. And then we have the other 40% in the cannabis space that are medical or adult use producers.

CO2 extraction has a lot of applications beyond cannabis. We have a couple of customers using our system for hops extraction, for example. We see an enormous opportunity out there for non-cannabis botanical extraction, but our primary focus is cannabis. That is what we’re designing this system to do.

We find that small hemp farmers love our system because it is reliable and very automated. We have proprietary software that operates the whole system. You load and run various “recipes,” at least we call them recipes. What you are doing is setting flow rate, setting temperatures, setting pressures, etc., then that proprietary software has an unbelievable ability to control everything through the process. I’ve talked to several different operators who have used other machines, and then found themselves on a Green Mill system and couldn’t believe how easy, but also feature-rich it was.

I talk about it like it’s like an oven, you know, you set the oven at 375 degrees. And a really good oven stays right at 375. You still need to be a good chef to be able to make that perfect cheesecake. But without that oven, your hands are tied, so you are constantly trying to check those, “is it still 375? I don’t know!” With our system, if it says 375, it holds at 375. So we’re pretty excited about that.

And we’re going to continue to innovate. For example, we have a proprietary heat exchanger that we use on our systems. It’s actually 3D printed stainless steel. It’s about a 20-pound piece of steel that’s been printed to have a special tubing shape in the center only possible with 3D printing that allows us to heat CO₂ very quickly.

Aaron: That’s very cool. I’m noticing a lot actually, the innovations in cannabis are creating these adjacent market opportunities in botanicals. So, I think that’s interesting you point that out. You mentioned terpenes are one of the things you collect out of the CO2 extraction. Can you talk about the crude that comes off and how people are either monetizing or formulating that crude?

Wes: Our goal is to produce the “purest crude” possible. So, we want “less crude” crude. I think that we’re at the beginning of this, Aaron. We’re nowhere near the end, which is what I find so exciting, because all of our innovation, all of our continued development and all of our experimentation is designed to keep thinking, how do we push this further and further and further and get a more refined crude.

Green Mill Supercritical’s Parallel Pro

We just welcomed Jesse Turner to our team as Director of R&D, who is a well-known extraction guy in the industry. He came from Charlotte’s Web and Willie’s Reserve, and has been doing independent consulting. He’s just a rock star. He’s already off and running on experimenting with different stuff.

I think that we are just at the beginning of seeing more and more of that opportunity to help people realize, “Oh, my gosh, I did not know you could do this!” Terpenes are a good example. I think we are only scratching the surface of what terpenes can do. I mean, a cannabis plant has 400 plus molecules and we know a good bit about probably 10 or 12 of them. So, what are we going to find out about the other 390? And as we do, the Green Mill system will be ideal for separating those molecules that we don’t know today are valuable. So, I think that’s part of what we’re chasing as well.

Aaron: So where do you see CO2 extraction fitting into the cannabis and hemp supply chain?

Wes: For any product on the market that is not a smokable flower it helps to have an extraction process. There may be some products that come out that we don’t know about yet that are not going to qualify in that category. Whether you are talking about vape cartridges, or lozenges, or gummy bears, or whatever it is, they are going to start with extract. I think what consumers want is zero adulteration of their product. So if you take any botanical product, and if it is GMO-free, does not have any pesticides, maybe it is all organic, etc. — there is real consumer appeal to that. Whether you agree with it or not, it is what consumers want.

We believe that we can continue to push CO2 so that there’s no requirement for introduction of any other materials than just CO2, which is a completely inert gas. It’s got no residual effect whatsoever on the product. If we get where we want to go, then eventually you are talking about a pure botanical experience.

Initial upfront capital is higher than you are going to see with ethanol and butane extraction solutions for the same size equipment, but ongoing operating costs of those are much higher, when you weigh it out over a period of time. I think what we are going to find is that people are going to keep coming to CO2 because they realize there are things they can do with it that they can’t do any other way.

The end consumer is really who we want to keep in mind. I think for a long time, this industry was very demand driven. “I have X acres of cannabis product, whether that’s hemp, sativa, indica, whatever it is, and I need to extract this many pounds a day over this period of time.” And we keep asking the question, well, who’s going to buy that product on the other side? What do you want it to look like when you put it out on the market? As opposed to how much raw plant matter do you have? What’s the demand? And that was a difficult conversation. We’re starting to see more people come around to that conversation now. But I think that’s the question we want to keep answering is how do we create those products that are differentiated in the marketplace and that can pass muster in any regulatory environment? People are going to want to know what’s in their product.

Aaron: What trends are you following in the industry?

Wes: As the CEO, I’m particularly interested in the overall development of the landscape of the industry in terms of who’s playing, who’s winning, what’s happening with legislation, MSOs versus SSOs. I’m also interested in the international environment. We have a good bit of interest from multiple countries that have either ordered Green Mill systems or are talking to us about Green Mill systems, including Canada and Latin American countries, some European countries, Australia and New Zealand.“We’re really committed to educational efforts with a very rigorous scientific foundation, but in language that is approachable and people can understand.”

The trends that I’m particularly interested in are more on the business side of the equation, in terms of how this business is going to shake out particularly from a capitalization perspective, as banking laws continue to change, which is a big deal, and the legislative environment gets a little more predictable and a little more consistent.

Aaron: Okay, last question. So what are you personally interested in learning more about?

Wes: Everything, is the short answer! I constantly run this little challenge of trying to understand enough of the science. I’m not a scientist, I’m a sales guy. That was how I grew up: general management and sales. I’ve made my living over many years being wowed by the pros. Depending on the scientists and the very specialized folks to help provide the right answers to things. I’m fascinated by the chemistry and I’m fascinated by the mechanical engineering challenges of what we do at Green Mill. So, I’m always interested in learning about that.

I think there’s a need, and it is helpful to be able to talk about those things in language that the layperson can understand, as opposed to explaining everything in scientific language. I think what I am trying to do is help people put it into a language that they can get, but that is not simple. Language that is correlative to reality. I think there’s so much misunderstanding about how these things work and what’s happening. We’re really committed to educational efforts with a very rigorous scientific foundation, but in language that is approachable and people can understand.

Aaron: Okay, that’s it. Thank you for your time Wes!

Soapbox

Confront Poor Medicinal Cannabis Policies to Save Lives

By Dr. Jordan Zager
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For me, the opioid epidemic was never a theoretical crisis. The mounting lives lost to overdoses weren’t just numbers in news reports to me, but names. A high school lab partner, little league teammates, a cook at my first restaurant job and others in my hometown were lost to the epidemic. By the time I graduated high school, seven people in my life died due to complications arising from opioid use.

What’s not lost on me now, after earning my PhD in plant biochemistry and founding a startup focused on bringing consistency and scientific credibility to the cannabis industry, is how a stigma around medicinal cannabis seems like such a contributing factor in their deaths.

Cannabis, although fully illegal in only eight U.S. states, still qualifies as a Schedule 1 drug on the federal level, legally equivalent to LSD or heroin. Crystal methamphetamine and cocaine as Schedule 2 drugs have lower penalties and even have federally approved medical applications. This is where we’ve failed as a broader scientific community.

The reason is this: Medicinal cannabis produced from the same genetic replicates, but grown in separate locations, or even different seasons, will possess different bioactive compounds. In short, their effect on patients will be different depending on the various bioactive compounds produced by the plant. Prescription medications do not come with that major caveat.

Dr. Jordan Zager, CEO and co-founder of Dewey Scientific

There’s a quality assurance problem, compounded by a lack of science that’s been shackled by the criminalization of cannabis since 1937.

We do know that the primary benefits of cannabis are three-fold: First, there’s pain management, as 28 well conducted randomized clinical trials (RCTs) have documented that cannabinoid agents are effective analgesics for chronic pain. Second, while potentially psychologically addictive, so people may desire the “high” produced by cannabis, THC is not chemically addictive and does not create a biological desire for the drug, much like the craving induced by the absence of, say, cocaine or heroin has on regular users. And finally, patients cannot overdose.

As a scientific community, there are three things we need to start doing today to change the narrative around medicinal cannabis and help bring this safer alternative therapy to more people. We need to provide a larger body of evidence about the benefits. We need to drive increased consistency in cannabis products themselves. And we need to confront stigmas rooted in misinformation. The sooner we can succeed here, the sooner we can hope for a day when we see fewer devastating opioid overdoses and deaths.

I am driven by a vision for a future when people can have access to safe, trusted and consistent cannabis for their medical and recreational uses, and we as a society are able to fully realize the therapeutic benefits of this amazing plant. As scientists, my colleagues and I are committed to doing our part to bring the credibility and advancements that will help this vision become a reality.

Using tools rooted in science–including functional genomics and secondary metabolite pathway expression profiling–cultivators can learn to fully “know” the plants they grow and hone in on producing the same bioactive compounds and in the same ratios that show medicinal promise. Cultivators can learn the genetic effect that their facility has on their genetics and why those genetics lead to a different chemical profile when grown elsewhere. Together, we can identify the driving factors of what makes a variety help with whatever ailment you are trying to treat.

I’m buoyed by data that shows states that have legalized and provided access to recreational cannabis have between 20% and 35% fewer reported opioid deaths, and lower rates of opioid prescriptions. But more needs to be done. I plan to become a more vocal voice, advocate for sound science, consistency in medical cannabis and better access to natural plant-based medicines without the stigma of yesteryear.

The time has come for our policy makers to step up. We cannot afford to just be observers when the cost of remaining on the sideline is measured in lives.

Product Safety Hazards: Looking Beyond Food Safety in Cannabis

By Radojka Barycki
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I think that we need to start changing the terminology around the hazards associated with cannabis from food safety hazards to product safety hazards. These hazards have not only been associated with harmful effects for those that ingest cannabis infused products, but also for those that consume the cannabis products in other ways such as inhalation (vaping or smoking). So, when we refer to these hazards as food safety hazards, the immediate thought is edibles, which misleads cultivators, manufacturers and consumers to have a false sense of security around the safety of products that are consumed in other ways.

Food processing and sanitation
By standardizing and documenting safety procedures, manufacturers mitigate the risk of cannabis-specific concerns

There are several product safety hazards that have been associated with cannabis. These hazards can become a public health problem if not controlled as they could harm the consumer, regardless of the method of consumption.

Let’s take a look at the different types of hazards associated cannabis:

Biological Hazards refer to those microorganisms that can cause illness to the consumer of a product that contain them. They are not visible to the naked eye and are very dangerous when their metabolic by-products (toxins) are ingested or their spores are inhaled. The symptoms for illnesses caused by these microorganisms will vary. Consumers may experience gastrointestinal discomfort (vomiting, diarrhea), headaches, fever and other symptoms. The ingestion of these pathogens, allergens or their by-products may lead to death, if the illness is not treated on time or if the consumer of the product is immunocompromised. In addition, the inhalation of mold spores when smoking cannabis products, can lead to lung disease and death. Some of the biological hazards associated with cannabis are: Salmonella sp., E. coli, Clostridium botulinum, Aspergillus sp. and Penicillium sp.

Chemical Hazards refer to those chemicals that can be present in the plant or finished product due to human applications (pesticides), operational processes (extraction solvents and cleaning chemicals), soil properties (heavy metals), environmental contamination (radiological chemicals) or as a result of occurring naturally (mycotoxins and allergens). Consuming high concentrations of cleaning chemicals in a product can lead to a wide range of symptoms from mild rash, burning sensation in the oral-respiratory system, gastrointestinal discomfort or death. In addition, long term exposure to chemicals such as pesticides, heavy metals, radiological contaminants and mycotoxins may lead to the development of cancers.

Physical Hazards refer to those foreign materials that may be present in the plant or finished product. Foreign materials such as rocks, plastics or metals can cause harm to the consumer by chipping teeth or laceration of the mouth membranes (lips, inner cheeks, tong, esophagus, etc.) In the worst-case scenario, physical hazards may lead to choking, which can cause death due to asphyxiation.

These hazards can be prevented, eliminated or reduced to an acceptable level when foundational programs (Good Agricultural/Cultivation Practices, Good Manufacturing Practices, Allergen Management Program, Pest Control, etc.) are combined with a Food [Product] Safety Plan. These lead to a Food [Product] Safety Management System that is designed to keep consumers safe, regardless of the method of consumption.

Steven Burton

Standardization: A Guide Through the Minefield

By Steven Burton
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Steven Burton

Now that cannabis edibles have been legalized nationally in Canada, many existing and aspiring license holders have been surprised to discover that they must comply with food safety regulations. This became crystal clear when Health Canada published their Good Production Practices Guide For Cannabis in August 2019.

With this development, it should be obvious to everyone that Good Manufacturing Practices (GMP) certifications are simply not enough.

Hazard Analysis and Critical Control Point (HACCP) based preventative control programs are now the absolute minimum and higher levels of certification (GFSI) should be on everyone’s wish list.

HACCP is a methodology that is all about identifying biological, chemical and physical hazards and determining how they will be controlled to mitigate the risk of injury to humans. Recently, bio-terrorism and food fraud hazards have been added to the list and it is a good idea to address quality hazards as well.

The process of developing a HACCP program involves identifying these hazards with respect to ingredients, materials, packaging, processes and cross-contamination points (explicitly required in Canada only). However, it is a specific ingredient hazard that I’d like to talk about here.

HACCPAs this market has emerged, I’ve met with many cannabis companies as the onerous levels of knowledge and effort required to build and maintain an effective HACCP program manually has dawned upon the industry. Many are looking for technological solutions to quickly solve this problem. During these discussions, a curious fact has emerged that set off the food safety alarm klaxons around here.

Most people alive today are too young to remember this but, with few exceptions, the standardization of ingredients is a relatively modern phenomenon. It used to be that the fat content of your milk varied from season to season and cow to cow. Over time, the food industry standardized so that, amazingly, you can now choose between milks with either 1% or 2% fat, a level of precision that would border on miraculous to someone born in the early 20th century.

The standardization of ingredients is important in terms of both quality and safety. Take alcohol for example. We know that a shot of spirits generally contains 40% alcohol. Different products may vary from this standard but, if I pour a shot of my favourite Bowmore No.1 single malt in Canada or Tasmania, this year or 10 years from now, I can expect a consistent effect from the 40% alcohol content of the quantity I’ve imbibed.

Imagine a world in which this was not the case, where one shot would be 40% but the next might be 80%. Things could get out of control quite easily at the 80% level so, to avoid this, distillers monitor and blend their product to ensure they achieve the 40% target, which is called the “standardization marker”.

With respect to cannabis, the obvious standardization marker is THC. During the manufacturing process, edibles manufacturers do not normally add cannabis flower directly into their products but instead add a THC concentrate produced during previous production steps. However, we’ve found that the wisdom of standardizing these concentrates has not yet dawned upon many in the industry, which is alarming at best and dangerous at worst.

The reason for this is that, since cannabis is inherently a heterogeneous plant, one cannot precisely achieve a particular marker value so the outcome of the concentration process is variable. The food industry long ago overcame this problem by blending or diluting to achieve a consistent marker concentration, but the cannabis industry has not yet adopted this advance.

The cannabis edibles industry is still immature and it will take time to bring all the necessary risk mitigation processes into place but one excellent place to start is to seriously consider standardizing concentrates to a THC marker.Instead, manufacturers simply keep track of the strength of each batch of concentrate and then adjust the quantity added to their recipes to achieve the desired THC content. This seems logical on the surface but presents a serious risk from the HACCP perspective, namely a chemical hazard, “Excessive psychoactive compound concentrations due to human error at levels that may be injurious to human health”.

The reality is that workers make mistakes, which is why it is imperative to mitigate the risk of human error insomuch as possible. One of the best ways to do this is to standardize to avoid the scenario where a worker, faced with a row of identical containers that are differentiated only by a tiny bit of text, accidentally grabs the wrong bottle. The error isn’t caught until the product has been shipped, consumed, and reports of hospital visits start coming in after the authorities trace the problem back to you. You must bear the costs of the recall, your reputation has been decimated and your company is floundering on the financial rocks.

US-based Drip More, LP recently found this out the hard way after consumers complained that their product tasted bad, bitter and/or harsh. An investigation determined that excessive nicotine content was the source of the problem and a voluntary recall was initiated. Affected product that had already been sold in 26 states. The costs of this recall have not been tallied but they will be staggering.

The cannabis edibles industry is still immature and it will take time to bring all the necessary risk mitigation processes into place but one excellent place to start is to seriously consider standardizing concentrates to a THC marker. This strategy is cheap, easy and you’ll never be sorry.

dry cannabis plants

Moisture Matters: Why Humidity Can Make or Break a Cannabis Cultivator’s Bottom Line

By Sean Knutsen
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dry cannabis plants

Vintners have known for centuries that every step in the winemaking process—from cultivation and harvest techniques to fermentation, aging and bottling—has immense impact on the quality and value of the final product.

And that same level of scrutiny is now being applied to cannabis production.

As someone who has worked in the consumer-packaged goods (CPG) space for decades, I’ve been interested in finding out how post-harvest storage and packaging affect the quality and value of cannabis flower. After digging into the issue some more, storage conditions and humidity levels have indeed come into focus as major factors, beyond just the challenges of preventing mold.

Weighty Matters

I enlisted my research team at Boveda, which has studied moisture control in all manner of manufactured and natural CPG products, to look closer at what’s happening with cannabis once it leaves the cultivation room. There’s not a lot of research on cannabis storage—we checked—and so we explored this aspect further. We were frankly surprised by what a big effect evaporation has on quality and how this is playing out on the retail level.

We suspected moisture loss could affect the bottom line too, and so we did some number-crunching.

It’s well understood that the weight of cannabis flower directly correlates with its profitability—the heavier the yield, the higher the market value. Here’s what our analysis found: A mere 5% dip below the optimal relative humidity (RH) storage environment eliminates six pounds per every 1,000 pounds of cannabis flower. At $5 per gram wholesale, that works out to upwards of $13,500 in lost revenue—and that’s with just a 5% drop in RH below the target range of 55-65% established by ASTM International, an independent industry standards organization.

We also purchased flower at retailers in multiple state markets and commissioned a lab to test the samples, which revealed that most strains sold today are well below the optimal RH range (55-65%). Regardless of fluctuating wholesale prices, when you do the math it’s clear that tens of thousands of dollars in revenue are simply evaporating into thin air.

Why So Dry?

Historically, cultivators, processors and packagers have emphasized keeping flower below a particular humidity “ceiling” for a reason: Flower that’s too moist is prone to hazardous mold and microbial growth, so it’s understandable that many operators err on the side of being overly dry.

The misconception that cannabis flower can be “rehydrated” is another cause of dryness damage. But this method irrevocably damages the quality of the flower through trichome damage.

trichome close up
The fine outgrowths, referred to as trichomes, house the majority of the plant’s resin

Those delicate plant structures that house the all-important cannabinoids and terpenes become brittle and fragile when stored in an overly dry environment, and are prone to breaking off from the flower; they cannot not be recovered even if the flower is later rehydrated.

When trichomes are compromised, terpenes responsible for the aroma, taste and scent of cannabis also can evaporate. Overly dried-out cannabis doesn’t just lose weight and efficacy—it loses shelf appeal, which is particularly risky in today’s market.

Today’s consumers have an appreciation for how premium flower should look, smell and taste. Rehydration cannot put terpenes back in the flower, nor can it re-attach trichomes to the flower, which is why preservation of these elements is so key.

Cannabis Humidity Control

Cured cannabis flower can remain in storage potentially for months prior to sale or consumption. By the time it reaches the end consumer, much of the cannabis sold in regulated environments in the U.S. and Canada has suffered from dry damage.

dry cannabis plants
Rows of cannabis plants drying and curing following harvest

There are various humidity controls available for cannabis cultivators: desiccants that absorb water vapor; mechanical equipment that alters RH on a larger scale; or two-way humidity-control packets designed for storage containers.

In the CPG sector, with other moisture-sensitive products such as foods and electronics, we’ve seen that employing humidity controls will preserve quality, and cannabis flower is no different.

Saltwater-based humidity control solutions with two-way vapor-phase osmosis technology automatically add or remove water vapor as needed to maintain a constant, predetermined RH level and ensures a consistent level of moisture weight inside the cannabis flower.

Here’s one more notable finding we discovered in our storage research: Third-party lab tests commissioned by Boveda showed cannabis stored with humidity control had terpene and cannabinoid levels that were 15% higher than cannabis stored without.

Cannabis stored within the optimal humidity range maximizes all the qualities that attract and retain customers. Similar to wine-making, when cannabis cultivators focus on quality control they need to look beyond the harvest.

A Playbook for Growth: Start with a True Cloud ERP as Your Foundation

By David Stephans
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Cannabis businesses have become a driving force for economic growth in the United States. We’ve all heard the statistics. In 2018, the industry accounted for approximately $10.4 billion in revenue and is slated to grow to $21 billion by 2021.

But with growth comes pressure to produce more, enhance quality and optimize operations. However, managing a cannabis business without modern, capable tools can hinder growth and leave opportunities on the table. That’s why fast-growing cannabis businesses are looking to the proven benefits of a true cloud Enterprise Resource Planning (ERP) platform to help manage production, provide insights and improve business operations. When we add in the complexity and ever-changing nature of regulation, the need for a robust operational system becomes even more critical.

David Stephans will be speaking during CIJ’s October 9th webinar, “Driving Strategic Advantage for your Cannabusiness through Process Efficiency, Quality & Compliance” Click here to learn more and register for free.Cannabis business leaders may want to develop their own “playbook” to differentiate themselves in the market. But before they start to engineer their forward-thinking approach, they should start with a cloud ERP as their foundation. This can help with everything from the most basic of needs to more sophisticated strategies. In this article, we’ll review some key cannabis business goals and tactics, and how ERP can help lay the groundwork for success.

Drive growth and expansion.

Business growth often translates into operational expansion, meaning more facilities, staff and compliance requirements to manage. A cloud ERP supports these functions, including the launch of new products, expanding pricing schedules and increasing production to meet demand. Having the ability to track and manage growth is crucial, and a cloud ERP can provide the real-time reporting and dashboards for visibility across the entire business. This includes not just operational visibility, but also a look into a company’s sales, finances and supply chain.

Foster exemplary customer experience.

Cannabis companies need to streamline processes from the moment an order is placed to when it arrives at the customer’s door. In the mind of consumers, cannabis businesses compete against the likes of Amazon. They must be able to provide a similar experience and level of service, with customers receiving orders in a couple of business days. Cloud ERP can help automate processes. And when things go wrong, it can also help with resolution, especially when it’s paired with a customer relationship management (CRM) system on the same cloud platform. For the B2B market, cloud ERP empowers account management to review past orders to better meet future customer needs.

Stay a step ahead of the game.

In the industry, change is a constant. The future will likely bring about shifts in products, regulations and suppliers. A cloud ERP can modify workflows, controls and process approvals on the fly, so companies can adapt to new requirements. It offers security against emerging risks and easy integration with other systems cannabusinesses may need. An advanced cloud ERP will also provide cutting-edge capabilities, such as AI insights and data-capture from Internet-of-Things (IoT) devices.

Ensure quality product for raving fans and avoid flags on the field through airtight compliance.

Many cannabis companies are passionate about delivering the highest-quality cannabis products. Auditability is key to both quality and compliance. Complete traceability, with lot and serial number tracking, will record comprehensive audit trails from seed to sale. A cloud ERP will incorporate RFID tags down to the plant, lot and product levels to assist in this process. As cannabis goods move through their lifecycle, the cloud ERP will append appropriate tracking to purchasing receipts, inventory as it moves between locations, products as they’re packaged and sales orders as they’re fulfilled.

As a heavily regulated industry, cannabis business is also subject to burdensome compliance standards. A cloud ERP can support the rigorous testing that’s required to assure potency and safety. It easily facilitates Good Manufacturing Practices (GMP) and Good Production Practices (GPP), which ensures products are consistently produced according to quality standards. Many regulatory agencies require digital reporting; cloud ERP can facilitate this requirement through integration with Metrc, Health Canada and the FDA. Compliance can be a costly endeavor, and this type integration saves time, money, and effort.

As you can see, a cloud ERP helps efficiently balance compliance and regulatory requirements, with operational efficiency and customer service – key strategies in any cannabusiness playbook.