WSDA and WSLCB Release Updated List of Approved Cannabis Pesticides

LCB is sharing this message on behalf of WSDA:

Marijuana Producers, Processors, and Retailers

Bulletin No 21-01

To: Cannabis Industry 

Fr: WSLCB and WSDA

Re: Updated List of Pesticides Allowed for Use in Cannabis Production

The Washington State Department of Agriculture (WSDA) has recently updated the list of  pesticides that are allowed for use in marijuana production in Washington State, based on  criteria previously established by WSDA.

WSDA has added six new Section 3 pesticides and ten new Section 25(b) pesticides to the list of allowable products for a total of 16 new products. There were 21 Section 3 pesticides and 6 Section 25(b) pesticides removed from the list.  The updated list contains 241 Section 3 pesticides and 94 Section 25(b) pesticides, for a total of 335 products.

WSDA has two columns on the list: (1) Section 3 pesticides that are subject to Worker Protection Standard (WPS) requirements, and (2) Section 3 pesticides that are limited to use by non-commercial “HG Only” marijuana growers. The products designated as “HG Only=Yes” may only be used by those individuals authorized to home grow medical use marijuana.

Products marked as “HG Only=Yes” may not be used in the commercial production of marijuana.

Spray adjuvants are not included on the list—however any spray adjuvant that is labeled for use on food crops can be used with an allowed pesticide that is applied to marijuana, as long as the intended use is authorized by the spray adjuvant label. For example, a spray adjuvant labeled only for use with an herbicide cannot be used with an insecticide or fungicide. Information on spray adjuvants that are registered for distribution in Washington is available from the WSU PICOL database.

Please check your stock of pesticides against the list to ensure that you are using an allowed product. Marijuana growers can continue to use any existing stocks of pesticides that were removed from the list, but no new product can be purchased.

All of the pesticides that were added to the list contain active ingredients that were already allowed for use in marijuana production.

Some pesticides are labeled for application to soil or to crop plants, while some pesticides are labeled for application to both soil and crop plants (e.g., insecticides, fungicides). Other pesticides include herbicides labeled for direct application to, and control of, unwanted plants (i.e., weeds). Remember to read, understand, and comply with all applicable label directions and precautions when using any pesticide.

 Pesticides Added:              Registration Number

  1. Arcus Plant Growth Regulator for Seed Treatment.           EPA No. 84846-5
  2. Guarda EPA No. 92144-2-70299
  3. Milstop SP EPA No. 68539-3
  4. Proof cold-pressed Neem Oil EPA No. 88760-10
  5. Seican EPA No. 91473-2-88783
  6. Suppress Herbicide EC EPA No. 51517-9
  7. Earth’s Ally Disease Control No. 996600-20007
  8. Earth’s Ally Disease Control Concentrate No. 996600-20008
  9. Earth’s Ally Insect Control No. 996600-20002
  10. Earth’s Ally Insect Control Concentrate No. 996600-21002
  11. GroSafe Bio-Pesticide, Miticide, Fungicide No. 996330-20001
  12. Grower’s Ally Fungicide No. 996600-20005
  13. Grower’s Ally Fungicide Concentrate No. 996600-20006
  14. Grower’s Ally Spider Mite Control No. 996600-20001
  15. Grower’s Ally Spider Mite Control Concentrate No. 996600-20003
  16. Procidic C No. 999550-21002

Pesticides Removed:

  1. Actino-Iron Biological Fungicide EPA No. 73314-2
  2. Actinovate Ag Biological Fungicide EPA No. 73314-1
  3. Amicos EPA No. 91473-1
  4. Bayer Advanced Natria Disease Control RTU EPA No. 264-1161-72155
  5. Bayer Advanced Natria Insecticidal Soap RTU EPA No. 67702-21-72155
  6. Bayer Advanced Natria Neem Oil Concentrate EPA No. 67702-21-72155
  7. Carbon Power EPA No. 84846-2
  8. Companion Liquid Biological Fungicide for Ag Use EPA No. 71065-3
  9. Genesis Gib-4% EPA No. 55146-62-71089
  10. Gibgro 20% Powder (Gibberellic Acid) EPA No. 55146-53
  11. Gibgro 4LS (4% Liquid Gibberellic Acid) EPA No. 55146-62
  12. Grandevo PTO EPA No. 84059-17-87865
  13. Greencure EZ EPA No. 70870-3
  14. Omni Oil 6E EPA No. 5905-368
  15. Perox-Cide EPA No. 83103-1-43553
  16. Perpose Plus EPA No. 86729-1
  17. Prefence Biofungicide EPA No. 64137-5-68539
  18. Preferal Microbial Insecticide EPA No. 70051-19-67690
  19. Pyrenone Crop Spray EPA No. 432-1033
  20. Regalia PTO EPA No. 84059-3-87865
  21. The Ecology Works Soluneem EPA No. 81899-4-67419
  22. Eco-Mite Plus Botanical Insecticide Miticide No. 74578-14001
  23. Eco-Mite Plus Botanical Insecticide Miticide Concentrate No. 74578-14002
  24. Eco PM Botanical Fungicide Concentrate No. 74578-13003
  25. Eco-PM Ready to Use Botanical Fungicide No. 74578-13001
  26. Mildew Control No. 89943-15001
  27. Nematode Control No. 89943-13001

You can find the complete list of pesticides that are allowed for use in marijuana production, the criteria WSDA used to establish the list, and information regarding statewide stop-sale orders in Washington on the WSDA web site: https://agr.wa.gov/departments/marijuana/pesticide-use

Contact Information:

For information regarding the registration of pesticides and fertilizers, please contact the WSDA Pesticide and Fertilizer Registration

  • Phone: 360-902-2025

Email for pesticide registration: pestreg@agr.wa.gov Email for fertilizer registration: fertreg@agr.wa.gov

For information regarding how to comply with the pesticide label, please contact the WSDA Pesticide Compliance

For any other questions, please contact your Liquor and Cannabis Board enforcement officer.

WSLCB Looking For Panelists For Its First Deliberative Dialogue Sessions

Be a Panelist, Participant, or Listener

WASHINGTON:  Do you want to share your perspectives about cannabis quality assurance testing? Would you like to share your experiences with fellow licensees, consumers, and others? Would you like to be part of a different way of sharing information and gaining understanding?

If you answered “yes,” let us know!

WSLCB has been working on developing new cannabis product-testing rules. A public hearing on proposed rules was held on November 18, 2020. While we heard oral comment from many licensees, we would like to hear from everyone in the supply chain so we have a better understanding of the complete system – processors, producers, retailers, consumers, and others. And we want everyone in the supply chain to have an opportunity to hear the wide range of perspectives

We’d like to hear from everyone in the supply chain so we have a better understanding of the complete system – processors, producers, retailers, consumers, and others. And we want everyone in the supply chain to have an opportunity to hear the wide range of perspectives.

About the sessions

LCB’s Policy and Rules manager Kathy Hoffman will moderate three sessions with different panelists and topics. To get the conversation started the sessions begin with prepared questions for each panel, with time near the end for audience questions and participation (online of course). Our goal is to increase communication between consumers, licensees, labs, and the agency.

The three session dates and topics as follows:

  • January 28, 2020: Consumer Panel (4 -5 panelists)
  • February 4, 2020: Processor/Producer Panel (5-6 panelists)
  • February 11, 2020: Cannabis Testing Lab Panel (4 -5 panelists)

We want to make sure that each panel represents the rich diversity of our communities, license types, and growing practices. Can you help?

Please send the following information to rules@lcb.wa.gov, attention Kathy Hoffman by close of business (5PM) on TUESDAY, JANUARY 20, 2020:

  1. Your name
  2. Which of the three panels and dates you’d like to be considered for
  3. Your contact information (email and phone number)
  4. Tell us if you are a consumer, producer, processor, producer/processor, retailer or lab employee or owner
  5. If you are a processor, producer or processor/producer, tell us:
    • Your tier size (1, 2,or 3); whether you are an indoor or outdoor grower; and where you are located.
  6. Tell us three or four questions you’d like to ask others on your panel (for example, how do other producers sample? Or, when you purchase product, what are you looking for?)

We will be sending more information on the deliberative dialogue process, our panelist selection process, and other details.

Don’t miss out on this opportunity to offer your perspectives on an important topic – send your information to rules@lcb.wa.gov, type in the subject line “Attention Kathy Hoffman” today!!

Massachusetts Cannabis Control Commission Approves Final Adult Use, Medical Use of Marijuana Regulations and Rescinds Colocated Regulations

MASSACHUSETTS: The Cannabis Control Commission (Commission) today approved new medical- and adult-use regulations and phased out 935 CMR 502, Colocated Adult-Use and Medical-Use Marijuana Operations, after bringing sufficient parity to the medical- and adult-use regulations.

“I’m excited that the revised medical- and adult-use regulatory revisions poise the Commission to make significant progress in our mission and statutory mandates on equity, patient access, and public health and safety,” Chairman Steven J. Hoffman said. “While we’ve made tremendous headway over the past three years, we now turn to critical work to implement new provisions, including; the increased caregiver/patient ratio, development of guidance documents, rollout of the Delivery Operator application, and a host of provisions establishing a more equitable and safe industry.”

In the coming weeks, the final regulations will be filed with the Secretary of State’s Regulation Division for promulgation and published on the Commission’s website.

Approved policies include:

Medical Use of Marijuana Program

  • Optimizing Patient access and preserving public safety by:
    • Allowing Caregivers to care for up to five Patients with a Canopy not in excess of 500 square feet;
    • Clarifying that Caregivers may seek a waiver to care for more than five Patients but cannot exceed the 500-square-foot limitation;
    • Preventing perceived risk of diversion by requiring Caregivers to create a log-of-growing and make that log available to the Commission upon request;
    • Broadening the types of physicians who can serve as the second physician making the recommendation for pediatric patients;
    • Requiring Certifying Health Care Providers (Providers) to have a plan to provide discounts to low-income Patients;
    • Allowing Patients with certain hardships to renew every two years instead of one year;
    • Permitting Patients to cultivate up to 12 flowering plants without hardship cultivation, and if more are needed, requiring hardship cultivation;
    • Allowing certain out-of-state Patients to be certified and registered as a Patient in Massachusetts; and
    • Restricting Caregivers from participating in paid advertising.

Equity Programming

  • Promoting a more inclusive and diverse industry by:
    • Waiving all Delivery application and license fees for Certified Economic Empowerment Priority Applicants (EEA) and Social Equity Program (SEP) participants in their first year of licensure under the exclusivity period;
    • Reducing annual license fees by 50%, or to $2,500, for EEAs and SEP participants upon renewal and all subsequent years for applicants;
    • Expanding SEP eligibility to certain categories of individuals and EEAs;
    • Requiring majority ownership by SEP participants in order to access license-related benefits, and potentially expanding these program benefits to microbusinesses and minority-owned, veteran-owned, and women-owned businesses; and
    • Clarifying that individuals who are EEAs, whether on their own or as part of a business entity, can apply as part of a new entity with EEA status so long as it continues to meet three or more of the six criteria, at least one of which shall be a majority-equity-ownership criterion.

Delivery

  • Increasing adult-use access and evolving the Delivery license type by:
    • Approving the Delivery Operator license type, which allows licensees to purchase wholesale Finished Marijuana Products with stringent requirements to warehouse;
    • Clarifying the statutory allowance of up to three Retail licenses and the regulatory allowance of up to a combined total of two Marijuana Courier and/or Delivery Operator licenses;
    • Extending the initial exclusivity period to three-years;
    • Allowing Third-Party Technology Platform Providers to contract with an unlimited number of Delivery Licensees;
    • Authorizing Delivery Operator Licensees to white label, or affix a product label that includes the branding (name and logo) of a specific Marijuana Establishment (ME) to a finished marijuana product that was previously produced and packaged by a licensed Product Manufacturer, Cultivator, Microbusiness, or Craft Marijuana Cooperative for sale to consumers;
    • Allowing Delivery Licensees to sell marijuana accessories and ME-branded goods and non-edible items directly to consumers; and
    • Automatically converting existing Pre-Certified “Delivery-Only” applicants to Delivery Courier Applicants.

Ownership & Control

  • Tightening stringent ownership and control measures further by:
    • Requiring EEAs to report to the Commission all changes of ownership and control and upon renewal and certifying to the Commission that the requisite ownership and control has been maintained by the requisite class of people identified on the EEA’s certification;
    • Preventing monopolies with the addition of safeguards between Third-Party Technology Platforms and Delivery Licensees by explicitly prohibiting:
      • monopolization or attempts at monopolization;
      • inducements;
      • direct or indirect investments from Third-Party Technology Platforms; and
      • restricting determinations of product and licensee placement on an app to objective, customer-oriented criteria.
    • Updating the definition of Persons or Entities with Direct Control by encompassing the equivalent of a Director in a business entity such as a Limited Liability Company, which has Managers in lieu of a Board of Directors, and setting a specific dollar amount with respect to what the Commission considers “significant contracts;” and
    • Confirming that EEAs hold majority ownership (51% or more) over the license to maintain priority status.

Product Database

  • Ensuring that the public is knowledgeable of the hallmarks of legally sourced products, preventing underage access, and lowering the risk of purchasing illicit products by adopting a requirement that Marijuana Establishments, including Delivery Operators, and MTCs comply with the Product Database requirement, just as adult-use licensees must.

Advertising and Branding

  • Modifying advertising and branding regulations by:
    • Allowing of branding sponsorships at certain events, with continued prohibitions on activities that target underage participants or entrants; and
    • Approving targeted advertising through mechanisms such as geofencing, provided they retain documentation of audience composition data related to these marketing activities.

Testing

  • Increasing testing accountability for licencees by:
    • Allowing marijuana products that fail initial contaminant screens to be:
      • Reanalyzed;
      • Remediated and retested by at least the original Independent Testing Laboratory, and a different Independent Testing Laboratory; or
      • Licensees may attempt remediation of a batch that has failed a second test prior to disposal or destruction.
    • Adding new pesticides to the list of pesticides currently required of Independent Testing Laboratory protocols; and
    • Requiring continued testing for vitamin E acetate and a secondary screen for heavy metals from finished vapes.

Video recordings of the Commission’s previous policy discussions and public hearings regarding the new regulations are available on Facebook and YouTube.

Oklahoma Medical Marijuana Authority Sets April 1, 2020 Laboratory Deadline

Oklahoma Medical Marijuana Authority

OKLAHOMA: Beginning April 1st, all marijuana product sold by a grower or processor will be required to be tested by an Oklahoma Medical Marijuana Authority (OMMA) licensed laboratory.

The mandatory testing requirements were created by the Oklahoma Legislature and went into effect on Nov 1st, 2019. Since that time, the OMMA has been creating the rules and guidelines under the guidance of Laboratory Oversight Manager Lee Rhodes.

The OMMA has ten fully licensed laboratories in the state. There are many more in different stages of the licensing process. A fully licensed lab will have not only a license from OMMA but have been inspected by the Oklahoma Bureau of Narcotics.

Current requirements include:

  • Any dispensary customer may request the certificate of analysis from the dispensary. The document can be kept in either a paper or electronic format.
  • A processor or grower shall retain test results and related records for at least two years.

A list of the fully licensed labs can be found on the OMMA website.

NBC Miami Report: Potency Of Commercially Marketed CBD Products Questioned

FLORIDA: Independent testing reveals that many commercially marketed CBD-infused products contain lower percentages of cannabidiol than are advertised on the products’ label, according to an investigation conducted by NBC News in Miami.

Investigators submitted 35 commercially available products for third-party independent lab testing. “Of the 35 samples … tested, 20 of them had less than half of the amounts of CBD advertised on the label,” NBC reported. Some samples, such as a package of infused gummies claiming to contain 1,000 mg of CBD, contained no cannabidiol.

The NBC findings are consistent with those of prior studies — such as those hereherehere, and here — which similarly reported that many CBD-infused products are of variable potency. Another recent study identified the presence of the psychoactive adulterants DXM and 5F-ADM in a line of products marketed by the manufacturer Diamond CBD.

By contrast, recent third-party testing of a sampling of 29 leading CBD-infused products by Remedy Review reported that all but one product tested positive for the presence of CBD at levels similar to what was advertised. However, three of the products did test positive for the presence of either pesticides or fungicides. “These results … indicate the need for independent monitoring and testing,” the company stated in a press release.


For more information, contact Justin Strekal, NORML Political Director, at (202) 483-5500.

Ohio Department Of Commerce Awards Act Laboratories With Private Testing Lab Provisional License

Ohio Medical Marijuana Control Program

Ohio Medical Marijuana Control Program

OHIO: The Ohio Department of Commerce has announced Act Laboratories as recipient of private testing lab provision license.  The recipients of the processor provisional licenses include:

PRIVATE TESTING LABORATORY PROVISIONAL LICENSE RECIPIENTS

  • ACT Laboratories, Inc.
  • Battelle Memorial Institute, Columbus
  • North Coast Testing Laboratories, LLC

The Ohio Department of Commerce continues to finalize the reviews of the private testing labs. There is no limit to the number of testing lab licenses that may be awarded. An additional period for testing lab applications will be opening soon.

UNIVERSITY TESTING LABORATORY PROVISIONAL LICENSE RECIPIENTS

  • Central State University
  • Hocking Technical College

LIST OF TESTING LABORATORY APPLICATIONS

The Ohio Department of Commerce accepted public university testing lab applications from September 11, 2017, though September 21, 2017, and privately-held testing lab applications from November 27, 2017, through December 8, 2017. In total, the Department received nine testing lab applications. Central State University and Hocking College submitted applications during the university testing lab application period.

The Department will continue its review of these testing lab applications and make an award once these reviews are completed. There is no limit to the number of testing lab licenses that may be awarded by the Department.

MMCP AND THE OHIO DEPARTMENT OF COMMERCE RELEASE APPLICATIONS FOR TESTING LABORATORY LICENSE FOR PRIVATE ENTITIES

The MMCP and the Department of Commerce have released the application, forms, and instructions for private companies to apply for a license to conduct laboratory testing of medical marijuana and medical marijuana products.

WSDA & WSLCB Release Updated List Of Pesticides Allowed for Use On Marijuana

WASHINGTON:  The Washington State Department of Agriculture (WSDA) has recently updated the list of pesticides that are allowed for use in marijuana production in Washington State, based on criteria previously established by WSDA.

WSDA has added 23 pesticides to the list of allowable products, and has removed eight pesticides since EPA has clarified that the existing tolerance exemption for sodium lauryl sulfate as an active ingredient does not allow direct contact with any food crop.

Pesticides containing two new active ingredients (Burkholderia spp. strain A396 (heat-killed), S-Abscisic acid) were added to the list. Most of the pesticides that were added to the list contain active ingredients that were already allowed for use in marijuana production.

Please check your stock of pesticides against the list to ensure that you are using an allowed product. Marijuana growers can continue to use any existing stocks of the eight pesticides that were removed from the list, but no new product can be purchased.

Added

  1. ANCORA, EPA Reg. No. 70051-19-59807
  2. AZAPRO, EPA Reg. No. 92629-1
  3. CONTEGO SL PLANT GROWTH REGULATOR SOLUBLE LIQUID, EPA Reg. No. 73049-493
  4. CYCLONE, EPA Reg. No. 89385-3
  5. DOKTOR DOOM TOTAL RELEASE FOGGER, EPA Reg. No. 72804-1
  6. GRANDEVO PTO, EPA Reg. No. 84059-17-87865
  7. KOPA INSECTICIDAL SOAP, EPA Reg. No. 67702-11-59807
  8. MONTEREY B.T., EPA Reg. No. 70051-106-54705
  9. NATRIA INSECTICIDAL SOAP READY-TO-USE, EPA Reg. No. 67702-21-92564
  10. NATRIA NEEM OIL CONCENTRATE, EPA Reg. No. 70051-2-92564
  11. SAFER BRAND NEEM OIL CONCENTRATE, EPA Reg. No. 70051-2-42697
  12. SAFER BRAND NEEM OIL RTU, EPA Reg. No. 70051-13-42697
  13. TERRANEEM EC, EPA Reg. No. 88760-5
  14. TERRANEEM OIL BIOLOGICAL INSECTICIDE, EPA Reg. No. 88760-4
  15. TRIACT 70 BROAD SPECTRUM FUNGICIDE INSECTICIDE MITICIDE, EPA Reg. No. 70051-2-59807
  16. TRIATHLON BA, EPA Reg. No. 70051-107-59807
  17. VENERATE XC, EPA Reg. No. 84059-14
  18. ALL PER-PLUS CONCENTRATE, WA Reg. No. 997750-15001
  19. ALL PER-PLUS READY TO USE, WA Reg. No. 997750-15002
  20. BRANDT ORGANICS ALEO, WA Reg. No. 48813-17002
  21. FUNGOUT, WA Reg. No. 89046-16001
  22. PURE KAPOW, WA Reg. No. 998220-13001
  23. PURE KAPOW COMMERCIAL, WA Reg. No. 998220-16001

Removed

  1. CANNA-CARE MITE-MILDEW BLITZ CONCENTRATE, WA Reg. No. 999500-16001
  2. GREEN CLEANER, WA Reg. No. 997740-15001
  3. INSTANT MITE KILLER READY TO USE, WA Reg. No. 996880-16001
  4. INSTANT MITE KILLER CONCENTRATE, WA Reg. No. 996880-16002
  5. MITE MASSACRE, WA Reg. No. 92504-17001
  6. PRO CANN-CARE SYNERGY + CONCENTRATE, WA Reg. No. 999500-16002
  7. PRO CANN-CARE SYNERGY + RTU, WA Reg. No. 999500-16003
  8. ROOT CLEANER, WA Reg. No. 997740-15002

You can find the complete list of pesticides that are allowed for use in marijuana production, and the criteria used to establish the list, on the WSDA web site:

Lightscale Labs Announces Cannabis Pesticide Testing In Oregon

OREGON: Lightscale Labs has joined a short list of accredited laboratories in Oregon how offering the full suite of compliance testing required for recreational and medical cannabis products.

“Pesticide testing is a critical component of making cannabis safer for Oregonians,” said Justin Ouellette, CEO of Lightscale Labs. “Cannabis producers and consumers alike have spoken loudly in favor of rigorous safety standards, but achieving those standards is a complex process and it’s meant that lab testing has generally fallen behind the incredible pace of the industry as a whole. We’re now starting to catch up.”

Oregon is unique among states that have legalized cannabis for its focus on health and safety. To receive a license to test cannabis, a laboratory must be accredited by the Oregon Health Authority (OHA) and undergo the same scrutiny as environmental labs that traditionally offer food, water, and soil testing. The accreditation process can be lengthy, creating a bottleneck for cannabis production in the state. With its new pesticide testing services, Lightscale Labs has significantly improved that bottleneck.

Recently, the OHA considered relaxing certain testing standards. “It’s important to find the right balance,” said Ouellette. “We all want to see the cannabis industry grow healthy and strong, and that means keeping lab testing requirements realistic. We hope Oregon will continue to serve as a model for the rest of the country, prioritizing public safety and evaluating the rules as the industry evolves and our scientific understanding improves.”

Washington Liquor and Cannabis Board Files For Emergency Testing Rules

NOTICE OF RULE MAKING – Emergency Rules – #16-42

 WASHINGTON: The Washington State Liquor and Cannabis Board filed Emergency Rules with the Code Reviser’s Office for Chapter 314-55 WAC.

The board approved refiling emergency rules for WAC 314-55-1025, Proficiency testing, and 314-55-1035, Laboratory certification – Suspension and revocation. The rules become effective today, December 7, 2016, and expire on April 6, 2017. Rulemaking to establish permanent rules on these subjects is currently underway. These emergency rules are to maintain requirements until permanent rules take effect.

This notice can be found at lcb.wa.gov/laws/laws-and-rules under Recently Adopted Rules.

 

Oregon Cannabis Industry Survey Predicts $10 Million Tax Revenue Decrease Due To Changes In Testing Protocol

OREGON: Cannabis industry economist Beau Whitney of Whitney Economics and the Oregon Cannabis Business Council today jointly released the results of a survey conducted this November that predicts a $10 million drop in fourth-quarter state tax revenue, a $187.5 million uptick in black-market sales, and layoffs and dispensary closures statewide due to Oregon Health Authority (OHA)’s new testing rules.

“October was a defining, if not catastrophic, month for Oregon’s cannabis industry, which, until then, was growing at a very fast rate,” Whitney said. “OHA’s new testing rules, which very few existing operations can presently comply with, virtually crippled the supply chain of adult-use and medical cannabis, from grower to retailer.”

Deployed on October 1, a change in Oregon Health Authority (OHA)’s testing certification, test limits and enhancement of a banned substances list for Oregon cannabis products resulted in longer test throughput times, a lack of available supply of cannabis products in both the medical and adult use markets, job losses and economic hardship.

The Whitney Economics/OCBC survey, conducted from November 14 to November 30 among 683 Oregon cannabis businesses, indicates:

  • Supply constraints due to the changes in testing protocol in Oregon have significantly impacted the Oregon Cannabis industry
  • On an annualized basis, black market activities have increased a projected $187.5 million due to a combination of higher prices and lower supply
  • Oregon tax revenues are projected to decrease by a minimum of $10.0M in Q4. This is conservative and is likely closer to $15 million – $20 million, as OLCC-licensed outlets are allowed to sell more product to an individual than is currently allowed in medical dispensaries. This was poised to increase sales by 2x to 4x current levels. The OHA rules constrain the industry at a time where there should be exponential growth
  • 22 percent of survey respondents indicated they are going out of business, and a large majority of 
survey participants plan to lay off employees for one to three months starting in fourth quarter 2016

Per survey results, as the new testing rules went into effect, very few laboratories were fully certified by the state regulatory bodies, so thus every medical and adult use business was required to use the certified labs to bring post-October 1 product to market. This created a bottleneck in the supply chain and, as a result, product availability was constrained. Test throughput, originally modeled by regulatory policy analysts to average five days, ended up in the range of 14-21 days, making products scarce. To make matters worse, the expanded testing criteria resulted in more failed tests. Product that was compliant on September 30 was now failing in large numbers for pesticides and other banned substances, as the thresholds for failure were tightened significantly.

Although official failure percentages are not available today, based on inputs from the laboratories themselves, data indicates between 40-60 percent of all submissions failed the enhanced testing standards (although government officials claim it is closer to 20-30 percent).

Given the perfect storm of a bottleneck at test, increased throughput times and a high percentage of test failures, the legal Oregon cannabis market is highly constrained for supply, Whitney said.

“Immediate action by the regulatory body, the OHA, and the Governor’s Office must take place now, before it is too late,” Whitney said. “The industry strongly supports public safety policies, but some reform must be made now that gradually increases standards rather than implementing them retroactively. Otherwise it will create an even larger public policy issue via a massive spike in illicit market sales, which will in turn increase access via black market channels to our youth.”

The survey results can be downloaded here: