Legal marijuana has resulted in an uptick in supply, which, as Bloomberg News recently reported, has dampened the profits of marijuana growers, who are seeing the price of pot plunge. However, as the report indicated, this may be an opportunity for companies that are able to carve out a niche by cutting production costs for cultivators.
Once-illicit growers have been banking on some degree of legalization, investing millions in facilities and factors that can help in the growth and processing of the drug. But there has been stiff competition in the marketplace, and that has driven down the average cost that wholesalers are willing to pay – now down to about $1,300 a pound in Denver since January 2014, when sales to all over-21 adults became legal in Colorado. That’s a nearly 50 percent drop in a span of just two years.
As supply of the drug has ballooned, growers are now looking to invest in the latest-and-greatest technology to help them cut down on their turnaround time. Any marijuana business that can help growers focus on efficiency is going to find themselves an edge in the market. Continue reading