Tag Archives: efficiency

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.

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Tips to Shrink your Shrinkage

By Carl Silverberg
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I had dinner last night with a friend who is a senior executive at one of the largest automobile companies in the world. When I explained the industry-accepted rate of 25-30% shrinkage in horticulture he said, “Are you kidding me? Can you imagine the story in the Wall Street Journal if I gave a press conference and said that we were quite content to throw away three out of every ten cars we manufactured?”

Yet, for all growers, operators and investors who complain about shrinkage, it’s an accepted part of the business. What if it wasn’t; what if you could shrink your shrinkage by 60% and get it down to 10% or less? How much more profitable would your business be and how much easier would your life be?

Let’s take the floriculture industry as our first example. You propagate chrysanthemums in February, they get repotted at the end of April and by the end of June, you might start to see some buds. In a very short time span your job changes from being a grower who manages 10,000 square feet of chrysanthemums to being an order taker. Over a period of eight weeks, you have to unload as many of those mums as possible. The sales team at Macy’s has more time to move their holiday merchandise than you do.

If you’re like most operations, your inventory tracking system consists of Excel spreadsheets and notebooks that tell you what happened in previous years so you can accurately predict what will happen this year. The notebooks give you a pretty accurate idea of where in the greenhouses your six cultivars are, how many you planted and which of the five stages they are in. You already have 30 different sets of data to manage before you add on how many you sell of each cultivar and what stage they were in.

The future of the industry is making data-driven decisions that free up a grower to focus on solving problems, not looking for problems.Then your first order comes in and out the window goes any firm control of where the mums are, what stage they’re in and how many of each cultivar you have left. A couple of hours after your first order, a second comes in and by the time you get back in touch, check your inventory, call back the buyer and she’s able to connect with you, those 2837 stage 3 orange mums are moving into stage 4. Only she doesn’t want stage 4 mums she only wants stage 3 so now you frantically call around to see who wants stage 4 orange mums very soon to be stage 5 mums.

And, the answer is often no one. What if you didn’t have your inventory count exact and now you have 242 yellow mums that you just found in a different location in your greenhouse and had you known they were there, you could have sold them along with 2463 other mums that you just located in various parts of your greenhouse.

It doesn’t have to be like that. We had a client in a similar situation, and they are on track to reduce their shrinkage to just a shade over 10%. The future of the industry is making data-driven decisions that free up a grower to focus on solving problems, not looking for problems.

And don’t think that shrinkage is an issue only in the purview of floriculture. It’s an even bigger problem for cannabis because of the high value of each crop. The numbers don’t sound as bad because unlike floriculture, you don’t have to throw out cannabis that’s not Grade A. You can always sell it for extract. But extract prices are significantly less per pound than flower in the bag.

Here’s how one grower explained it. “Because of the high value of the crop, and the only other crop I’ve worked with that high is truffles, you’re playing a much higher stakes game with shrinkage. Even if you try and salvage a bad crop by using all of the parts of the cannabis plant. Listen, the difference between Grade A and Grade C could be $1,000 for A while a pound of B/C is less than $400. If you produce a standard 180 to 200 pounds in your grow rooms, you’ve really screwed up. No operator is going to keep you if you just cost them $120,000.”

Cannabusiness Sustainability

Environmental Sustainability in Cultivation: Part 2

By Carl Silverberg
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The first article of this series discussed resource management for cannabis growers. In this second piece of the series on how indoor farming has a reduced impact on the environment, we’re going to look at land use & conservation. There are really two aspects and we have to be up front and acknowledge that while our focus is on legal cannabis farming, there’s a significant illegal industry which exists and is not subject to any environmental regulation.

“Streams in Mendocino run dry during the marijuana growing season impacting Coho salmon and steelhead trout who lay their eggs in the region’s waterways.” One biologist reported seeing “dead steelhead and Coho on a regular basis in late August and September, usually due to water reduction or elimination from extensive marijuana farming.” The quotes are from an extensive article on cannabis land use by Jessica Owley in the U.C. Davis Law Review.The concept that land will stay in its natural state is a mixture of idealism and reality.

This is going to continue until it’s more profitable to go legit. For this article, we’re going to focus on the legitimate cannabis grower. On the land use side, we usually hear four main reasons for indoor growing: remaining land can stay in its natural state, fewer space usually translates to fewer waste, you conserve land and natural resources when you don’t use fossil fuels, greenhouses can be placed anywhere.

The concept that land will stay in its natural state is a mixture of idealism and reality. Just because someone only has to farm five acres of land instead of one hundred acres doesn’t necessarily mean they’re going to leave the rest in its pristine natural state. Granted the footprint for automated greenhouses is significantly less but the key is what happens to that extra space. Assuming that it will all be preserved in its natural state isn’t realistic. What is realistic is the fact that a developer may not want to build tract houses abutting a commercial greenhouse operation. If they do, likely there’s going to be more land set aside for green space than if a farm was sold outright and a series of new homes were plunked down as if it were a Monopoly board.

Combined with workforce development program funding, urban indoor farming is getting more attractive every day.That’s not the same kind of issue in urban areas where the situation is different. Despite the economic boom of the past ten years, not every neighborhood benefitted. The smart ones took creative approaches. Gotham Greens started in Greenpoint, Brooklyn and has expanded to Chicago as well. “In early 2014, Gotham Greens opened its second greenhouse, located on the rooftop of Whole Foods Market’s flagship Brooklyn store, which was the first ever commercial scale greenhouse integrated into a supermarket.”

Green City Growers in Cleveland’s Central neighborhood is another example. “Situated on a 10-acre inner-city site that was once urban blight, the greenhouse—with 3.25 acres under glass–now serves as a vibrant anchor for the surrounding neighborhood.”

The beauty of greenhouse systems even those without greenhouse software, is they can be built anywhere because the environmental concerns of potentially contaminated soil don’t exist. The federal government as well as state and local governments offer a myriad of financial assistance programs to encourage growers to develop operations in their areas. Combined with workforce development program funding, urban indoor farming is getting more attractive every day.

As for the argument that greenhouses save energy and fossil fuels, I think we can agree that it’s pretty difficult to operate a thousand-acre farm using solar power. To their credit, last year John Deere unveiled a tractor that will allow farmers to run it as a fully autonomous vehicle to groom their fields while laying out and retracting the 1 kilometer long onboard extension cord along the way. It’s a start although I’ll admit to my own problems operating an electric mower without cutting the power cord.

In a 2017 article, Kurt Benke and Bruce Tomkins stated, “Transportation costs can be eliminated due to proximity to the consumer, all-year-round production can be programmed on a demand basis, and plant-growing conditions can be optimized to maximize yield by fine-tuning temperature, humidity, and lighting conditions. Indoor farming in a controlled environment also requires much less water than outdoor farming because there is recycling of gray water and less evaporation.”

The overall trend on fossil fuel reduction was verified this week when the Department of Energy announced that renewables passed coal for the first time in U.S. history.  And on the water issue, Ms. Owley had a salient point for cannabis growers. “The federal government will not allow federal irrigation water to be used to grow marijuana anywhere, even in states where cultivation is legal.” That’s not a minor detail and it’s why outdoor farming of cannabis is going to be limited in areas where water resources and water rights are hotly debated.

Cannabusiness Sustainability

Climate Change Drives Cannabis Indoors

By Carl Silverberg
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This is not a discussion of climate change, it’s a discussion of the impact of weather on the agriculture industry. The question for the cannabis & hemp industry, and basically the entire specialty crop industry, is what will be the impact? According to the U.S. National Climate Assessment, “Climate disruptions to agriculture have been increasing and are projected to become more severe over this century.” I’m sure that’s not much of a shock to anyone who owns a farm, orchard or greenhouse.

Every national newspaper for the past two weeks has published at least one article a day about the flooding in the Midwest, while industry newsletters and blogs have contained more in-depth stories. The question is, what can agriculture professionals do to mitigate these problems?

Relying on state and national legislators, especially heading into a presidential election year is likely to be frustrating and unrewarding. Governments are excellent at reacting to disasters and not so good at preventing them. In short, if we depend on government to take the lead it’s going to be a long wait.Instead, many farmers are looking at the future costs of outdoor farming and concluding that it’s simply cheaper, more efficient and manageable to farm indoors.

Instead, many farmers are looking at the future costs of outdoor farming and concluding that it’s simply cheaper, more efficient and manageable to farm indoors. Gone are the days when people grew hemp and cannabis indoors in an effort to hide from the police. Pineapple Express was a funny movie but not realistic in today’s environment.

Today’s hemp and cannabis growers are every bit as tech savvy as any other consumer-oriented business and one could argue that given the age of their customers (Statista puts usage by 18-49-year-olds at 40%), distributors must be even more tech savvy to compete effectively. Some estimates put the current split of cultivation at about one-third indoors/two-thirds outdoors. To date, the indoor focus has been on efficiency, quality and basically waiting for regulators to allow shipping across state lines.

A major driver in the indoors/outdoors equation is that as the weather becomes more unfriendly and unpredictable, VC’s are factoring climate disruption into their financial projections. When corn prices drop because of export tariffs, politicians lift the ban on using Ethanol during the summer months. It’s going to be a while before we see vehicles running on a combination of gasoline and CBD.

Leaving aside the case that can be made for efficiency, quality control and tracking of crops, climate change alone is going to force many growers to reassess whether they want to move indoors. And, it’s certainly going to weigh heavily in the plans of growers who are about to launch a cannabis or hemp business. Recently, one investment banker put it to me this way: greenhouses are the ultimate hedge against the weather.

Beleave Achieves ISO 9001 Certification

By Aaron G. Biros
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According to a press release, Beleave Inc. announced recently that their subsidiary, Beleave Kannabis Corporation, received the ISO 9001:2015 certification. The facility that received the certification, based in Hamilton, Ontario, was certified “for the research, development, and production of cannabis products for medicinal and recreational purposes,” reads the press release.

Beleave is a vertically-integrated cannabis business headquartered in Oakville, Ontario that cultivates cannabis as well as producing oils and extracts. The company operates in both medical and recreational sectors of the market. They have been working on developing cannabis food and beverage products, such as infused powders and sugars, expecting that the recreational cannabis market in Canada will soon open its doors to infused products in 2019.

ISO 9001:2015 is an international standard that stipulates requirements for a quality management system (QMS), showing that a facility can provide products that meet customer and regulatory requirements. ISO 9001:2015 is the most up-to-date version for the standard, which can help show a company’s commitment to quality, efficiency and consistency. The 2015 version uses criteria with an emphasis on risk-based thinking to aid in the application of the process approach, improved applicability for services and increased leadership requirements.

“We continue to develop international partnerships and plan to enter global markets”The company’s facility was certified by Bureau Veritas Certification Holding SAS in late January of 2019. According to Roger Ferreira, chief science officer at Beleave, the process of certification was no easy undertaking. “After many months of hard work and preparation, we are extremely proud to be one of the few licensed producers of cannabis to have received ISO 9001:2015 accreditation,” says Ferreira. “This certification reflects Beleave’s ongoing commitment to quality across key elements of our business, which includes research, innovation, and production of cannabis products.”

Going beyond Canada, Ferreira says they are building the foundation of a company preparing to expand internationally. “Further, this internationally recognized certification for our quality management system positions us well as we continue to develop international partnerships and plan to enter global markets,” says Ferreira. Through their ownership in Procannmed S.A.S., they are licensed to cultivate and produce medical cannabis products out of Colombia, with the goal to export products to the Latin American market. They have also partnered with Canymed GmbH, based in Germany, to further explore opportunities in the European medical cannabis market.

Seven Steps To Avoid the Green Rush Blues: Investigate Water Supplies Before Planting Cannabis

By Amy M. Steinfeld
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A clean, reliable water supply lies at the heart of every successful cannabis farm. It’s no surprise that the stakes for finding land with ideal growing conditions, including adequate water, are high. But new buyers (and lessees) caught up in the green rush often gloss over water rights or are unaware of California’s byzantine rules governing the irrigation of cannabis.

Water rights are complex. Water regulations applicable to cannabis cultivation are even more complex. And our new climate reality convolutes things further. Longer droughts, more volatile weather, political uncertainties, increased groundwater regulation and water quality concerns are exacerbating tensions over local and statewide water supplies. In many areas of California, landowners can no longer rely on local water districts to meet their needs.

A robust investigation of the property must consider water supplies. Because a property’s water supply is dependent on water rights, local ordinances, state regulations, politics and hydrology, it’s important to consult a water lawyer (and in some instances a hydrologist) before closing. A bit of foresight can prevent a grower from being left high and dry.

The following checklist provides a roadmap to conduct water rights’ due diligence. While many of these details are California-specific, this type of due diligence applies throughout the West.

Step 1: Identify Available Water Supplies and Consider Potential Limitations On Irrigation, Including Potential Future Changes

Conduct a site visit to identify existing water infrastructure, natural water features and existing or potential water service options. Next, determine if the property is served by a public water supplier. If that’s the case, the California State Water Resources Control Board (“State Water Board”) does not require any specific documentation to irrigate cannabis, but the water supply must be disclosed in the CalCannabis license application.

Groundwater is generally the best supply for cannabis, but the era of unregulated groundwater pumping is over. Many groundwater basins in California are now governed by the Sustainable Groundwater Management Act (“SGMA”), which requires water agencies to halt overdraft and restore balanced levels of groundwater pumping from certain basins. As a result, SGMA may result in future pumping cutbacks or pumping assessments. It’s imperative to identify the local groundwater basin via the Department of Water Resources’ Bulletin 118, and determine whether the groundwater basin is adjudicated or governed by a groundwater sustainability agency. Growers should also test the local water supply’s pH and salt levels because cannabis plants are finicky and water treatment can be cost prohibitive. If a new well is needed, growers should consult with their local county before drilling a new well. In some areas, moratoriums and restrictions on drilling new wells are on the rise.

As a rule of thumb, cannabis cultivators should avoid using surface water to irrigate cannabis. Surface diversions are subject to the California Department of Fish and Wildlife’s permitting authority. And under the interim State Water Board Cannabis Policy, commercial cannabis cultivators cannot divert anysurface water during the dry season (April 1 through Oct. 31), even if they have a riparian right that can be used to irrigate other crops. During the dry season, cultivators may only irrigate using water that has been stored off-stream. And even during the wet season, cannabis cultivators must comply with instream flow requirements and check in with the state daily to ensure adequate water supplies are available. Cannabis cultivators are also required to install measuring devices and track surface water diversions daily. And buyer beware, a groundwater well that extracts water from a subterranean stream may be considered a surface-water diversion. So be especially cautious if the well is located close to a creek or river.Develop a water use plan to optimize water efficiency 

Step 2: Identify Water Supplies Used On the Property, Including the Basis of Right, and Quantify Historical Use

Review information on historic and existing water use. This may include past water bills and assessments. If there is a well on the property, the seller or lessor may have metering data, electrical records and crop data that can establish historic groundwater use. Cultivators must submit a well log to CalCannabis as part of the cannabis cultivation application. If surface water is available, the purchaser should review the State Water Board eWRIMs database for water rights permits, licenses, stock pond registrations and certificates, decisions and orders. The purchaser should also identify surface water diversion structures and review annual filings to determine compliance with all terms and conditions of the water right. Lastly, the purchaser should request all documents and contracts pertaining to water rights.

Realistically estimate water demand for irrigation and other on-site purposes.Step 3: Confirm Ownership of Right and Assess Any Limitations On Water Right

Determine whether the right has been abandoned, lost to prescription or forfeited. Evaluate the seniority of the water right, availability of the right, adequacy of place of use, purpose of use (must include irrigation), season of use, and quantity of any permitted or licensed post-1914 right. Determine whether historical diversions pursuant to an appropriative right support the full amount of the claimed right, and whether any changes to the water right are needed to support the proposed new use. Cultivators in California who plan to utilize surface water also need to file for a “Cannabis Small Irrigation Use Registration” to store water during the wet season for use during the dry season.

Step 4: Reconcile Water Demand With Available Supply

Realistically estimate water demand for irrigation and other on-site purposes. Develop a water use plan to optimize water efficiency (drip irrigation, rainwater harvesting, water monitoring, hoop structures) regardless of supply sufficiency. Many counties, such as Santa Barbara County, require that cannabis growers meet certain irrigation efficiency standards. Determine whether available supplies can meet all proposed demands, including plans for full buildout. If not, consider whether additional supplies are available for use on the property.

Step 5: Determine Water Supply Compliance Obligations

 The rights associated with water supplies are defined by their source, the time frame during which supplies can be taken, the quantity of water to which the right attaches, and any limitations on the purpose of use of the water supply. There may also be reporting requirements associated with taking and using the supply—these can include requirements to report the quantity of water used as well as information regarding the end use of the water. Failure to timely report can have serious consequences. Cannabis cultivators are also subject to additional water quality regulations and restrictions, including waste discharge requirements pursuant to the State Water Board’s Cannabis General Order.

Step 6: Negotiate Deal and Draft Conveyance Documents

After obtaining an understanding of the water supply associated with the property, the property conveyance documents may be drafted to incorporate the transfer of rights associated with the property’s water supplies. These may include the assignment of contracts pursuant to which water supplies are obtained, the transfer of permits or licenses as to the water supplies, or the transfer of water rights arising out of a judgment or decree.

Step 7: Consider Unused Water Supply Assets That Could Be Monetized 

To the extent the water supply rights associated with the property exceed the cannabis plants’ water demand, it may be possible to monetize unused or excess water supply assets through transfer of the rights to a third party.

If you have any questions about water rights related to cannabis cultivation it’s always in your best interest to contact an experienced water attorney early on in the process.

Dr. Ed Askew
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Distillation Of Your Cannabis Extract: Ignorance Is Not Bliss

By Dr. Edward F. Askew
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Dr. Ed Askew

In a previous article I discussed the elephant in the room for clients of laboratory services- the possibility of errors, inaccurate testing and dishonesty.

Now, I will explain how the current “smoke and mirrors” of distillation claims are impacting the cannabis industry in the recreational and medical areas. We have all heard the saying, “ignorance is bliss.” But, the ignorance of how distillation really works is creating misinformation and misleading consumers.

That is, just because a cannabis extract has been distilled, doesn’t mean it is safer.There have been reports of people claiming that “Distilled cannabis productsthat are Category 2 distillate are pesticide free and phosphate free, while Category 1 has pesticides and phosphates, but within acceptable limits”

The problem is that these claims of Category 1 and Category 2 cannot be proven just by saying they are distilled. Ignorance of the physical chemistry rules of distillation will lead to increased concentrations of pesticides and other organic contaminants in the supposedly purified cannabis distillate. That is, just because a cannabis extract has been distilled, doesn’t mean it is safer.

So, let’s look at a basic physical chemistry explanation of the cannabis distillation process.

  • First off, you must have an extract to distill. This extract is produced by butane, carbon dioxide or ethanol extraction of cannabis botanical raw material. This extract is a tarry or waxy solid. It contains cannabinoids, terpenes and other botanical chemicals. It will also contain pesticides, organic chemicals and inorganic chemicals present in the raw material. The extraction process will concentrate all of these chemical compounds in the final extract.
  • Now you are ready to distill the extract. The extract is transferred to the vacuum distillation vessel. Vacuum distillation is typically used so as to prevent the decomposition of the cannabinoid products by thermal reactions or oxidation. Under a vacuum, the cannabinoids turn into a vapor at a lower temperature and oxygen is limited.
  • Part of the vacuum distillation apparatus is the distillation column. The dimensions of this column (length and width) along with the packing or design (theoretical plates) will determine the efficiency of distillation separation of each chemical compound. What this means is that the more theoretical plates in a column, the purer the chemical compound in the distillate. (e.g. Vigreux column = 2-5 theoretical plates, Oldershaw column = 10-15 plates, Sieve plate column = any number you can pay for).
  • The temperature and vacuum controls must be adjustable and accurate for all parts of the distillation apparatus. Failure to control the temperature and vacuum on any part to the apparatus will lead to:
    • Thermal destruction of the distillate
    • Oxidation of the distillate
    • Impure distillate

Now, you can see that a proper distillation apparatus is not something you throw together from a high school chemistry lab. But just having the proper equipment will not produce a pure cannabis product. The physical chemistry that takes place in any distillation is the percentage a chemical compound that occurs in the vapor phase compared to the percentage in liquid phase.So, how can you produce a cannabis distillate that is clean and pure?

For example, let’s look at whiskey distillation. In a simple pot still, alcohol is distilled over with some water to produce a mixture that is 25%-30% ethanol. Transferring this distillate to an additional series of pot stills concentrates this alcohol solution to a higher concentration of 85%-90% ethanol. So, each pot still is like a single theoretical plate in a distillation column.

But, if there are any chemical compounds that are soluble in the vapor produced, they will also be carried over with the vapor during distillation. This means that pesticides or other contaminants that are present in the cannabis extract can be carried over during distillation!

So, how can you produce a cannabis distillate that is clean and pure?

  • Produce a cannabis extract that has lower concentrations of bad chemicals. Since a lot of the cannabis extracts available for distillation are coming from grey-black market cannabis, the chances of contamination are high. So, the first thing to do is to set up an extraction cleanup procedure.
    • An example of this is to wash the raw extract to remove inorganic phosphates. Then recrystallize the washed extract to remove some of the pesticides.
  • Make sure that the distillation apparatus is set up to have proper temperature and vacuum controls. This will limit production of cannabis decomposition products in the final distillate.
  • Make sure your distillation apparatus has more than enough theoretical plates. This will make sure that your cannabis distillate has the purity needed.
  • Finally, make sure that the staff that operates the cannabis distillation processes are well trained and have the experience and knowledge to understand their work.

Inexperienced or under-trained individuals will produce inferior and contaminated product. Additional information of extract cleanup and effective vacuum distillation can be obtained by contacting the author.

VinceSebald
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Automation – Planning is Everything

By Vince Sebald
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VinceSebald

Automation of processes can provide great benefits including improved quality, improved throughput, more consistency, more available production data, notifications of significant events and reduced costs. However, automation can also be expensive, overwhelm your workforce, cause future integration problems and magnify issues that you are currently experiencing. After all, if a machine can do work 100 times faster than a human, it can also produce problems 100 times faster than a human. Whether it is a benefit or a scourge depends largely on the implementation process.

There are thousands of possible technology solutions for just about any production problem. The trick to getting results that will work for your company is to use good engineering practices starting from the beginning. Good engineering practices are documented in various publications including ISPE Baseline Guides, but there are common threads among all such guides. What will the system be used for and what problem is it intended to solve?

The key is implementing a system that is fit for your intended use. As obvious as it sounds, this is often the most overlooked challenge of the process. In the grand scheme of things, it is a MUCH better proposition to spend more time planning and have a smooth operation than implement a system quickly and fight it because it isn’t a good fit for the intended use. The industry is littered with systems that were prematurely implemented and complicate rather than simplify operations. Planning is cheap, but fixing is expensive.

The most important step to getting an automated system that will work for you is also the first:

Defining “what” you need the system to do: User Requirements

Automation Runaway
Once automation is in place, it can be a boon to production, but don’t let your systems get ahead of your planning! It can be difficult to catch up.

With decades of experience in the automation industry, I have seen systems in many industries and applications and it is universally true that the definition of requirements is key to the success of the automation adventure. To clarify, the user requirements are intended to define “what” the system is required to do, rather than “how” it will do it. This means that persons that may not be familiar with the automation technologies can still be (and usually are) among the most important contributors to the user requirements document. Often, the people most familiar with the task that you wish to automate can contribute the most to the User Requirements document.

Some of the components of a User Requirements document typically include:

  • Purpose: What will the system be used for and what problem is it intended to solve?
  • Users: Who will be the users of the system and what is their relevant experience?
  • Integration: Is the system required to integrate into any existing or anticipated systems?
  • Regulatory Requirements: Is the system required to meet any regulatory requirements?
  • Functions: What is the system required to do? This may include operating ranges, operator interface information, records generation and storage, security, etc.
  • Performance: How many units per hour are required to process?  What percent non-conforming product is acceptable?
  • Environment: What environment is the system required to operate in? Indoor, outdoor, flammable, etc.
  • Documentation: What documentation is required with the system to support ongoing maintenance, calibration, etc.?
  • Warranties/Support: Will you perform work in-house, or will the manufacturer support the system?

The level of detail in the User Requirements should be scaled to the intended use. More critical operations may require more detailed and formal User Requirements. At a minimum, the User Requirements could be a punch list of items, but a detailed User Requirements may fill binders. The important thing is that you have one, and that the stakeholders in the operation have been involved in its production and approval.Once completed, the User Requirements can be a very good document to have for prospective providers of solutions to focus their attention on what is important to you, the customer.

Equally important to the process is the idea of not over-constraining the potential solutions by including “how” the system will meet the requirements within the User Requirements. If it is required to use specific technologies for integration with other existing systems, it is appropriate to include that information in the User Requirements. However, if use of a particular technology (e.g. “wireless”) is not required, the inclusion may unnecessarily eliminate viable design options for systems that may address the requirements.

Once completed, the User Requirements can be a very good document to have for prospective providers of solutions to focus their attention on what is important to you, the customer. This helps to ensure that they focus their efforts in the areas that match your needs and they don’t waste resources (which translate to your costs) in areas that don’t have tangible benefits to you, the customer. It also gives you a great tool to “value engineer”, meaning that you can consider cutting design options that do not support the User Requirements, which can reduce project costs and timelines, keeping things lean and on track.

Further steps in the project are built around the User Requirements including system specifications provided by vendors, testing documentation and the overall turnover package. An appropriately scaled User Requirements document is a low cost, easy way to ensure that your automated system will serve you well for years to come. Alternatively, the lack of a User Requirements document is an all-too-common indicator that there may be challenges ahead including scope creep, missed deadlines and unacceptable long term performance.


Feel free to reach Vince at vjs@sebaldconsulting.com with any questions you might have.

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How Cannabis Can Positively Impact California’s Drought

By Lukian Kobzeff
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As the drought in California persists and quickly becomes the new hydrological norm, many within the state have embraced efforts to find ways and means to live within the drought forced water “budget.” Because of the importance of water conservation, the cannabis industry should embrace its socio-ecological responsibility and seize the opportunity to help shift the perception of cannabis cultivation into that of a sustainable, high-value agricultural crop that can be grown in an environmentally safe manner, while using water efficiently.

The intersection of Prop 64, MCRSA and the drought provides the cannabis industry with a unique opportunity to positively impact water conservation. Because legal cannabis cultivators are just now designing blueprints for grow sites, these cultivators are in a position to build infrastructure and systems specifically designed to achieve permanent, sustainable water conservation.

By embracing and championing water conservation, the cannabis industry will achieve two goals: being a collaborative player in the larger community working towards sustainable water use and enhancing the overall perception of the cannabis industry in the conscious of the general public. For an industry seeking legitimacy, there is no better way to put cannabis in the mainstream conscious than by embracing environmentally responsible philosophies. Here are a few measures the cannabis industry should embrace:

Measure

The current drought has generated a state-wide conversation about tracking and recording water usage. Some commentators believe California is suffering from a water data problem. Recently passed AB 1755 is a step by California to address that shortcoming by creating a technology platform to aggregate and share water data. Cannabis cultivators should get onboard with measuring water usage. One method is to install sensitive flow meters in each drip station to precisely measure water used during each grow cycle. First, this provides the cultivator with a precise data set. Precise data sets are extremely important, especially when trying to achieve the two-part-goal of conserving water and maximizing crop yield. Second, having precise data sets allows the cultivator to determine, from harvest-to-harvest, increasingly precise ratios of input (water) to output (flower). Most likely, this input:yield ratio is subject to diminishing returns at the margin; that is, adding additional water will not proportionately increase crop yield. For instance, 50 units of water could produce 50 units of crop, but 75 units of water might only produce 55 units of crop. By measuring the input (water), the cultivator is able to identify the precise threshold where diminishing returns set in and can therefore reduce the “diminishing returns” water usage, saving money and conserving water.

Collaborate

Building on water-usage data collection, cultivators can then collaborate with each other and with water agencies. By sharing data sets, cultivators can quickly develop ideal input:yield ratios, can better understand how water usage fluctuates within each discreet grow cycle and can develop methods such as deficit irrigation and real-time soil moisture measurements. This collective industry knowledge will help each individual cultivator to reduce water-usage. In collaborating with local water boards, the boards will better understand how much water is being used and conserved by the industry. Additionally, if the boards have a more precise understanding of the expected usage per season or per specific period in a grow cycle required by cultivators in their jurisdictions, those boards can better plan for the peaks and troughs in water demand. Besides data sharing, agencies and cultivators can collaborate in developing “fill stations” (offering free, non-potable recycled water for irrigation), or help fund development of direct potable water technologies and other recycled water technologies. Collaboration amongst growers and with water boards will lead to greater water conservation.

Energy Saving

An ancillary benefit to water conservation behaviors is the reduction of energy consumption. It takes an immense amount of energy to pump and transport water to end-users, such as cultivators. Reducing water usage in turn reduces energy consumption, because less water used means less water transported and disposed of. This is one method for indoor cultivators to offset energy consumption. In addition to reducing energy usage by conserving water, cultivators can follow Irvine Ranch Water District’s example of implementing an energy storage system to reduce costs and ease energy demand during peak hours. Indoor cultivators should adopt the same basic structure and mechanics: install Tesla battery packs to store energy for use during peak hours (when electricity is more expensive) and recharge the batteries at night when demand is low (and electricity is cheaper).

Opportunities Abound

This is an exciting time in California’s history, with the pending election of Prop 64, the passage of MCRSA, and the opportunities present in the water-energy nexus. The $6 billion cannabis industry has an incredible opportunity to have a far-reaching impact on water-conservation. By being an active collaborator conserving water, the cannabis industry can position itself as a trendsetter and private sector leader in sustainable and eco-conscious methods, technologies, and processes.

Building or Converting to a Greenhouse? Four Considerations for Commercial Growers

By Taylor Engert
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Successful cannabis cultivation practices leverage commercial agricultural industry practices for the most efficient and cost-effective production of the crop. Since the 1990s, the cannabis industry has cultivated primarily in indoor warehouses and outdoor farms, however the industry is experiencing a significant shift toward greenhouses.

Shelly Peterson, vice president of light product solutions at urban-gro, joined a recent panel of industry experts including Shivawn Brady, chief executive officer and founder of Seva Crop Consulting, and Karl Keich, executive director at Canna Consulting Group, at the Marijuana Business Conference in Orlando, Florida, to discuss how to transition from an indoor or outdoor grow to a greenhouse facility.

What are the considerations when deciding between a warehouse and greenhouse? The panel shares four factors around the costs and operational challenges, and the benefits of a greenhouse.

panel
The panel at the Marijuana Business Conference.

Maximize Efficiency in Every Process

Why are cannabis cultivators looking toward greenhouses? Peterson says it is all about efficiency. “In a warehouse, electricity costs can run up to 50 percent of the total cost of goods sold, which is a tremendous amount that can be decreased by switching to a greenhouse,” says Peterson. “In a greenhouse, you can add supplemental lighting to augment what the plant is receiving from the sun.”

For cultivators, Peterson noted that it is critical to ensure growers have experienced vendors and advisors on the team to help maximize the efficiency of the greenhouse. “As the cost of this product comes down, the efficient growers will be the ones in it for the long haul,” added Peterson.

Construction vs. Operating Costs

A greenhouse facility that urban-gro helped bring to operation.
A greenhouse facility that urban-gro helped bring to operation.

The panel identified upfront cost as one of the biggest challenges faced when building out a greenhouse. “The cost of retrofitting a warehouse and building a greenhouse are similar, but where you will save is in the operational costs,” says Peterson. “Lighting can be up to one third of your total cost in indoor facilities, when you switch to a greenhouse that cost can be reduced by 50 to 70 percent.”

Brady acknowledged that some traditional greenhouses have challenges in controlling the environment, but automated greenhouses offer retractable roofs and siding. “If you have the resources to invest in your greenhouse system upfront, that is generally a better way to save money in the long run,” says Brady. “Managing pests in greenhouses can also become very challenging if you don’t have the proper climate regulations.”

Lighting for Your Greenhouse

One of the greatest benefits of growing in a greenhouse is the ability to source natural light. But what about the required light levels? Peterson pointed out that light levels change throughout the year and the plants have different light needs in different stage. Supplement with a lighting system that can read the natural light levels received over any given period of time and be adjusted accordingly. “Greenhouse facilities also need to be outfitted to meet the needs of the cannabis plant, which differ in some ways from other agricultural crops,” says Peterson.

Peterson explained that every light is designed with a different purpose in mind. “There are different lights for indoor warehouse facilities where the lighting system provides 100 percent of the available light for cannabis growth versus supplemental lighting for greenhouses,” Peterson adds. “The key is to measure how much light is actually delivered by the sun on a daily basis, which changes throughout the year; at urban-gro, we supplement the facility with light fixtures that will not create shadowing during hours of sunlight and adjust to reach the optimal collective light levels.”

With LED lighting a hot button topic, Peterson explained that the most important consideration for any light fixture, whether LED or HPS, is it’s efficiency capacity. “It all depends on the budget and payback period and a lot of numbers need to be crunched,” says Peterson. “Yield is directly correlated to light; planning properly, sealing your environment, making sure you have the right target DLI, and buying good light meters, are all key.”

Make a Positive Impact and Quality Product

Brady noted that industry leaders are conscious of positive impact towards human health and environmental stewardship when moving to a greenhouse. Cultivators may find the process challenging initially, however the facilities are quite easy to operate and manage, and allow stress-free cultivation of commercial-scale crops.

Keich added that the cannabis industry is becoming more like commercial agriculture. By utilizing the correct technologies and regulators, greenhouse cultivation makes the crop smell, taste and look that much better. “Let’s use natural sunlight to minimize costs and be environmentally friendly to produce a superior product,” says Keich.

Peterson wrapped up by stressing that cultivators should evaluate the greenhouse environment and lighting to improve their bottom line. “Look at the most efficient way to lower your cost of goods sold. Lighting is a very big component to that,” she continued. “Make sure you evaluate the efficiency of the fixture and ask the questions: Why are we targeting this light level? Is the color spectrum correct? Are you measuring in micromoles per watt? These are all different questions, however figure out how much light is coming out of the fixture and verify it for yourself, and you will be successful,” says Peterson.