The CalCannabis Appellations Project Is About to Spark a New Chapter in Place-Based Branding

The CalCannabis Appellations Project Is About to Spark a New Chapter in Place-Based Branding

Original Post: Cannabis Industry: The CalCannabis Appellations Project Is About to Spark a New Chapter in Place-Based Branding

[Canniseur: In the wine business, provenance (where the wine is from) is everything. Where the grapes were grown should be an indication of the character of the wine, if not the quality. Why should cannabis be any different? While the jury is out on cannabis appelations (place names), it will be very interesting to find out if cannabis follows the same rules as Vitis vinifera (wine grapes like cabernet are all in this genus and species) as far as place, growing, flavor and effect. Will you be able to tell that a particular bud is from Humboldt by its taste and effect sometime in the future?]

Connoisseurs know that pairing a fine cut of steak with a Napa Valley cabernet sauvignon is a sure winner. But how many are aware that pairing strawberry cheesecake with a certified Santa Cruz Blue Dream cannabis strain creates an equally delicate palatal synergy? Thanks to the California Department of Food and Agriculture’s CalCannabis Appellations Project (“CAP”), premium cannabis regions will soon have the potential to capitalize on such newfound awareness among discerning consumers.

For decades, cannabis connoisseurs have been willing to pay a premium for flower said to have been grown in certain regions or with certain techniques, but because of cannabis’ legal status, supply chains have been opaque. As a result, cultivators of distinct cannabis strains struggled to capture the full market potential of their products. That has begun to shift with implementation of California’s Cannabis Track-and-Trace System. The costs associated with implementation of the METRC1 system have been bemoaned by many in the industry, but there is also tremendous potential value in having the most transparent supply chain in the world. The CalCannabis Appellations Project is the vehicle through which brands will be able to harness that value.

The underlying premise behind the CalCannabis Appellations Project is that the distinctive qualities of a cannabis product are often attributable to where and how the plant is grown. Through this project, CalCannabis is developing a statewide appellations system2 that will allow qualifying licensed cultivators to effectively communicate information about their cannabis crops (i.e., the standards, practices and/or varietals used) through labels, advertisements and other marketing techniques. It will also prevent disingenuous cannabis cultivators from making inaccurate claims about where and how a product is grown, which protects the integrity and value of the appellation.

What is an appellation?

In general terms, an appellation is an identifying name, title or label that can be legally defined and protected. Appellations are most commonly used in the wine industry to geographically identify the origin of grapes in a particular bottle. This place-based identification system comes from an understanding that certain regions have unique environmental and growing characteristics, which result in a product that cannot be produced from other regions even when the same varietals are used. Famous wine appellations or American Viticultural Areas (AVAs) in California include the Napa Valley and Santa Ynez AVAs, and sub-AVAs such as the Russian River Valley AVA, located within the larger Sonoma County AVA.

Recognizing there are also growing regions that produce uniquely distinctive cannabis, CalCannabis is developing a process for:

  1. Establishing an appellation (i.e., identifying regions that produce distinctive cannabis and defining standards, practices and/or varietals that must be used in those regions to qualify for an appellation); and
  2. Qualifying to use a particular appellation once they are established (i.e., determining the cannabis cultivators that can legally label or market themselves as belonging to a particular appellation).

While the state has not released program details, it’s likely that cultivators will have to demonstrate their outdoor-grown cannabis is distinctly unique.3 CalCannabis has until Jan. 21, 2021,4 to establish these processes, but a draft is expected to be released by early January 2020.5 This is an opportunity for cultivators to organize and participate in the process to define and create unique local appellations.

What are the benefits of an appellations system?

Napa wine country
Image: James Faulkner, Flickr

Appellations benefit both cannabis cultivators and consumers. It allows small farmers to capture the value that consumers place on unique and local cannabis products. Allowing for product differentiation through an appellations system will prevent cannabis from becoming a commodity—a situation that could result in indistinguishable products and a single market price for cannabis regardless of how or where it is grown. Thus, an appellations system protects not only local economies and farming communities, but also consumers that care about the origin and growing practices of their cannabis.

A criticism of appellations, particularly in the wine industry, is that they can disincentivize innovation and industry growth when strict growing practices and standards are required to be a part of an appellation. This will be an important consideration as CalCannabis establishes its appellations system.

County of Origin

In addition to setting up an appellations system, the CalCannabis Appellations Project will expand upon current county of origin regulations. Unlike an appellation designation, the county of origin designation is designed to be much more inclusive—it can currently be used on any cannabis product as long as 100% of the cannabis is grown within the designated county.6 Whereas an appellation will communicate information about the quality of a cannabis product and how it was produced, a county of origin designation is more like a “Made In” label. For example, a county of origin designation can be applied to indoor cannabis whereas an appellation will likely only include sun-grown cannabis.

There is also a desire to allow city of origin designations in addition to county of origin designations, which would enable products grown wholly within the political boundaries of a city to further differentiate themselves.7 As the legal cannabis landscape changes nationwide, it may also be important to have a statewide appellation allowing products to be marketed as “Grown in California.

What should cannabis cultivation regions be doing now?

After CalCannabis releases a draft process for establishing an appellation, the next steps will be clarified. However, not everyone is waiting. For instance, growers in Mendocino County have already started to organize.8 The Mendocino Appellations Project divided the county into 11 unique subregions based on regional growing conditions and practices that could potentially be turned into appellations in the future. The goal of the appellations outlined by the Mendocino Appellations Project is to protect cannabis products coming out of Mendocino County and preserve the region’s growing heritage.

A group in Sonoma County is also discussing the establishment of appellations with the hope that it will help differentiate their cannabis and draw attention to the unique microclimate and soil structure in parts of Sonoma County.9 The groups involved in these discussions also believe it will allow cultivators to develop strict growing standards and to protect certain strains, while creating new jobs and encouraging agritourism. Appellations will become increasingly important as sophisticated consumers begin to select quality cannabis that aligns with their preferences.


References

  1. METRC is the third-party-owned software contracted by California authorities to implement the commercial cannabis track-and-trace system “from seed-to-sale.”
  2. Passage of Senate Bill 185 calls for the use of the term “appellations of origin” instead of “appellations.”
  3. Based on comments made during the October 23 Cannabis Advisory Committee Meeting.
  4. Business and Professions Code Section 26063.
  5. Based on comments made during the October 23 Cannabis Advisory Committee Meeting.
  6. Business and Professions Code Section 26063(a).
  7. Based on comments made during the October 23 Cannabis Advisory Committee Meeting.
  8. https://swamiselect.com/mendocino-appellation-project/
  9. https://www.sonomacountygazette.com/sonoma-county-news/cannabis-appellations-the-small-cannabis-farmers-elyon-cannabis.

The post The CalCannabis Appellations Project Is About to Spark a New Chapter in Place-Based Branding appeared first on Cannabis Industry Journal.

Designing More Sustainable Cannabis Facilities

Designing More Sustainable Cannabis Facilities

Original Post: Cannabis Industry: Designing More Sustainable Cannabis Facilities

[Canniseur: We need to do anything in our power to be more sustainable in our every day lives. When building our cannabis companies, even our mundane flooring choices can make a difference. Learn more about about flooring choices as it impacts your grow house.]

The topic of sustainability has grown in importance and priority for both consumers and regulators. From reducing emissions to lowering energy and water consumption, cannabis growing facilities face unique challenges when it comes to designing sustainable operations. Moreover, as the cannabis market grows and usage becomes more accepted, regulatory bodies will continue to increase the number of directives to help ensure the safety and quality of cannabis products.

Non-porous flooring options are impervious in nature, helping to isolate contaminants on the surface, thus enabling proper cleanup and disposal.

Ubiquitous throughout cannabis grow rooms and greenhouses, flooring can be easily overlooked, yet offers an economical way to create more sustainable facilities. Many of today’s grow rooms are located in old retrofitted warehouses or former industrial buildings that were designed without sustainability or environmental concerns in mind.

Combined with energy efficient lighting and more thoughtful water usage, flooring can help create a more efficient facility that not only improves business operations, but also contributes to a better bottom line.

Sustainability Challenges Facing Cannabis Facilities

Whether in an old warehouse space or a new structure designed from the ground up, cannabis businesses face unique operational challenges when it comes to sustainable best practices.

  • Energy Consumption: Like any indoor farm, lighting plays an important role in cannabis growing facilities. Traditional grow lights can utilize a large amount of electricity, putting a strain on the company budget as well as regional energy resources. Switching to highly-efficient LED lighting can help facilities reduce their consumption, while still maximizing crop yield.
  • Water Consumption: Among the thirstiest of flora, cannabis plants require consistent and plentiful watering for healthy and fruitful crop production.
  • Carbon Dioxide (CO2) Enrichment: In many cases, carbon dioxide is introduced into facilities to help enhance the growth of crops. However, this practice may pose safety and health risks for workers, the surrounding community and the planet at large. CO2 is a greenhouse gas known to contribute to climate change.

In order to head off upcoming regulatory restrictions, as well as to alleviate the mounting safety and health concerns, it behooves cannabis grow room managers and owners to explore alternatives for improving sustainability in their facilities.

Flooring Requirements for More Sustainable Cannabis Facilities

Spanning thousands or even hundreds of thousands of square feet throughout a facility, flooring can be a unique way to introduce and support sustainable practices in any grow room or greenhouse.

When seeking to improve operational efficiency and implementing the use of sustainable practices in cannabis facilities, look for flooring systems with the following characteristics:

  • Impervious Surfaces— Fertilizers, fungicides, and other chemicals can infiltrate porous unprotected concrete to leach through the slab matrix and into the soil and groundwater below. Non-porous flooring options, such as industrial-grade, fluid-applied epoxies and urethanes, are impervious in nature, helping to isolate contaminants on the surface, thus enabling proper cleanup and disposal.
  • Light-Reflective Finishes— Light-colored white or pastel floor surfaces in glossy finishes can help reduce the amount of energy needed to properly illuminate grow rooms. By mirroring overhead lighting back upward, bright, light-reflective flooring can help minimize facilities’ reliance on expensive ceiling fixtures and electricity usage.
  • USDA, FDA, EPA, OSHA and ADA Compliancy— With cannabis industry regulations currently in flux, grow facilities that select food- and pharmaceutical-compliant flooring will be ahead of the game. Governing bodies in some states have already begun expanding the facility requirements of these sectors to the cannabis market.
  • Durable and Easy Care— Having to replace flooring every couple of years imposes high costs on businesses as well as the environment. Installation of many traditional types of flooring produces cut-off waste and requires landfill disposal of the old floor material. In contrast, by installing industrial-grade flooring systems that are highly durable and easy-to-maintain, facilities can count on long-term performance and value, while helping to minimize disposal costs and concerns.
Florock

Light-colored white or pastel floor surfaces in glossy finishes can help reduce the amount of energy needed to properly illuminate grow rooms.

Optimal flooring can help cultivation facilities reduce waste, improve the efficacy of existing lighting and lengthen floor replacement cycles for a better bottom line and a healthier environment. Additionally, having the right grow room floor can assist facilities in meeting regulatory requirements, help ensure production of quality products and improve the safety for consumers and staff.

Flooring Benefits for Employees and Consumers

Safety is paramount in any workplace. When it comes to the manufacture of foodstuffs and other consumed products, government oversight can be especially stringent. With the right compliant flooring in place, cultivation facilities can focus on the rest of their business, knowing that what’s underfoot is contributing to the safety of employees and their customers.

Here’s how:

  • Chemical Resistance— Floors can be exposed to a high concentration of chemicals, acids and alkalis in the form of fertilizers, soil enhancers and other substances. In processing locations, the proper disinfecting and sanitizing of equipment can require harsh solvents, detergents and chemical solutions, which can drip or spill onto the floor, damaging traditional flooring materials. It pays to select cannabis facility flooring with high chemical resistance to help ensure floors can perform as designed over the long term.
  • Thermal Shock Resistance— Optimal cannabis facility flooring should be capable of withstanding repeated temperature cycling. Slab-on-grade structures in colder climates may be especially vulnerable to floor damage caused by drastic temperature differences between a freezing cold concrete slab and the tropical grow room above. This extreme contrast can cause certain floor materials to crack, delaminate and curl away from the concrete substrate. The resulting crevices and uneven surfaces present trip and fall hazards to employees and leave the slab unprotected from further degradation. As an alternative, thermal shock-resistant floors, such as urethane mortar systems, furnish long-lived functionality even when regularly exposed to extreme temperature swings.
  • Humidity and Moisture Resistance— Traditional floor surfaces tend to break down in ongoing damp, humid environments. Cannabis facility flooring must be capable of withstanding this stress and more.
  • Pathogen Resistance— Undesirable microbes, fungi and bacteria can thrive in the moist, warm environments found in grow rooms. Floors with extensive grout lines and gaps provide additional dark, damp locations for pathogen growth. Fluid-applied flooring results in a virtually seamless surface that’s directly bonded to the concrete. Integral floor-to-wall cove bases can further improve wash down and sanitation.
  • Proper Slope and Drainage— Where food and/or pharmaceutical facility regulations have already been extended to cannabis operations, flooring is required to slope properly toward a floor drain. This prevents puddling, which can be a slip hazard as well as a microbe breeding ground. Unlike more typical materials, resinous flooring offers an economical solution for correcting floor slope wherever needed.

The Problems Presented by Traditional Flooring Options

Previously, cannabis growers often relied on traditional greenhouse-type flooring, including tamped down dirt floors, gravel or bare concrete. However, current and upcoming regulations are curtailing the use of these simple flooring options.

Growers often compare and contrast the benefits and value of traditional greenhouse flooring with more modern solutions, such as fluid-applied epoxy and urethane floors.

Dirt and gravel flooring offers little opportunity to properly sanitize, thus potentially inviting microorganism and pathogen invasion, contamination and costly damage. Growers who have turned to bare concrete floors face other concerns, including:

  • Unprotected concrete is inherently porous and therefore able to quickly absorb spilled liquids and moisture from the air. In addition, organic and synthetic fertilizers, fungicides, and chemicals can leach through the concrete floors, contaminating the groundwater, injuring the surrounding environment and wildlife.
  • Older slabs often lack an under-slab vapor barrier. Even in new construction, a single nail hole can render an under-slab barrier ineffective. In these situations, moisture from underneath the floor slab can move upward osmotically through the alkaline slab, leading to blistering and damage to standard commercial floor coverings.
  • Bare concrete floors can stain easily. These dark stains tend to absorb light instead of reflecting it, contributing to a potential increase in energy usage and cost.
  • The mold proliferation encouraged by the warmth and humidity of grow rooms can easily penetrate into the depths of unprotected slab surfaces, eventually damaging its structural integrity and shortening the usable life of the concrete.

While traditional greenhouse flooring options can initially seem less expensive, they frequently present long-term risks to the health of cannabis grow businesses. In addition, the performance of dirt, gravel and bare concrete floors runs counter to the industry’s commitment to reducing the carbon footprint of growing facilities.

Choosing Sustainable Grow Room Flooring

It’s no secret that the cannabis industry is undergoing enormous change and faces numerous environmental challenges. Luckily, optimal flooring options are now available to help growers economically increase their eco-friendly practices on many fronts. By focusing on quality resinous flooring, cannabis growers can get closer to meeting their sustainability goals, while simultaneously contributing to improved operation efficiency, enhanced yields and an increased bottom line.

Luxembourg Announces Plans For Two Year Transition To Recreational Use

Luxembourg Announces Plans For Two Year Transition To Recreational Use

Original Post: Cannabis Industry: Luxembourg Announces Plans For Two Year Transition To Recreational Use

[Canniseur: It’s a little surprising the little country of Luxembourg could wield much influence over big countries like Germany and Italy. But…they certainly do seem to have a whole lot of influence. And now they’re moving to include adult use.]

For those who have been watching, Luxembourg has played an inordinately influential role on the entire cannabis discussion in Europe for the past year.

This summer, the country announced that it had plans to implement recreational use (for residents only) within two years.

Last summer, the country not only changed its medical use policy as the Deutsche Börse tried to halt the clearances of cannabis trades made in Germany (Luxembourg is the place where the stock trades clear), but set a five-year mandate and timeframe as well.

This new announcement certainly is an attempt to signal at any rate, that the government is not going to run out the clock. But, realistically, with the extra six months already in front of the start date necessary to enshrine the legislation, plus whatever complications arise after that, Luxembourg could initiate its market on January 1, 2022.

Or, as is more likely, it could not. Including rolling delays caused by everything from EU objection and internal logistical hurdles of other kinds to lack of access to product.

Refom Redux?

Will Luxembourg be the “Colorado of Europe?” Probably not.

Will Luxembourg “be the next Canada?” Probably not either. However it is also worth noting that legislators and lawmakers from Luxembourg have drawn recent inspiration via numerous fact finding trips to Canada of late.

It is also worth remembering that even Canada’s great, green, “well-oiled” cannabis machine delayed its recreational market start by months last year. And that was a scenario already a generation in the making.

Further, as some would argue this summer, certainly post CannTrust, the relative “speed” with which Canada embraced its recreational market is again being criticized for not only being precipitous but a direct cause of problems in financial compliance and tracking.

The lack of regulatory muster, in other words, that even allowed a CannTrust to happen, will not fly in Europe. Certainly not in a country where regulations, including that of the European kind, are decided upon (the other center of EU regmaking is of course Brussels).

For that reason, no matter how exciting the news to an industry fighting an uphill battle on medical efficacy, there is plenty of room to temper enthusiasm.

Luxembourg is not going to be “just like” anywhere seen so far. The needle has moved. And the conversation is morphing if not moving on.

One of the most intriguing aspects of all of this, of course, is how insurers will treat the entire discussion.

Holland Round 2?

Here is what Luxembourg also won’t be. A new tourist mecca for out of towners. At least according to the current discussion. How the government will prevent that, is of course unclear. The same grey areas exist in the law behind Barcelona’s social clubs. The Dutch have tried for most of this decade to discourage this – and have largely failed.

What it very well might be, however, is a catalyst for change.  A before and after moment if you will.

european union statesThe Swiss are moving ahead with recreational and medical trials. The British, whatever their relationship with the world after Halloween, are too.

Luxembourg, whatever it ends up being, in other words, is well timed, if nothing else, to be a reference point if not conversation starter about real reform.

Including of course, medical impact, if not, beyond that, efficacy.

Here is where Luxembourg might in fact, be much closer to the Dutch experiment than any other place. Despite the fact the country has had a coffee shop culture for over 30 years, and Dutch medical cannabis is exported to countries all over the world, here is what is missing in Holland: Medical health insurance coverage for patients. In fact, Dutch insurers, en masse, stopped reimbursing the drug as soon as Germany changed its insurance rules in March 2017.

If that is on the agenda for Luxembourg, in other words, no matter how exciting a timeline for recreational is anywhere in Europe, this will be a pyrrhic victory indeed.

Disposable Gloves: The Unregulated Cannabis Threat

Disposable Gloves: The Unregulated Cannabis Threat

Original Post: Cannabis Industry: Disposable Gloves: The Unregulated Cannabis Threat

[Canniseur: Who would have thought that the rubber gloves I’ve seen many people at dispensaries wear while weighing out bud could contaminate our purchase? At the production level of the cannabis industry, I’ve seen lots of photographs of people trimming plants wearing disposable gloves. The story below was shocking, not just for the cannabis industry, but for any industry where people need to wear disposable gloves. If the companies that made disposable gloves were ethical, this wouldn’t be a problem. It is a problem that has a strong case to be examined.]

Today in the states where medical and recreational cannabis is legal, cannabis products purchased from licensed facilities are required to have undergone testing by accredited labs. The compliance testing verifies advertised potency levels and checks for microbial contamination, herbicides, pesticides, fungicides and the presence of mold and mildew, among other potential contaminants.

Until recently, little attention has been given to disposable gloves and their possible involvement in the contamination of the products they handle.  What factors should you consider when purchasing gloves?

Disposable Gloves Facts

Disposable gloves, like cannabis products, are not made of equal quality. There are several different types of disposable gloves on the market, and huge variations in glove quality and chemical compositions exist between and within each glove type.

Recent scientific studies have revealed how gloves produced in factories with poor manufacturing standards and raw material ingredients can contaminate the products they handle. High-level toxins in disposable gloves were found to affect lab results, toxins in gloves contaminated the food they touched, and pathogen contamination of unused disposable gloves has been proven. Should the cannabis industry take more interest in the disposable gloves they are using? With so much at stake if compliance test results are compromised, we think so!

Glove Procurement: Factors to Consider

What factors should you consider when purchasing gloves?

  1. Industrial grade gloves- There is no such thing as an industrial grade glove certification, although it does give an incorrect impression that gloves are strong and resilient. Industrial grade means they have not been subjected to inspection nor have passed any specific testing requirements.
  2. Food contact gloves are certified under FDA Title 21 CFR Part 177, which states the components of the glove comply with the FDA regulations and the gloves consist of “substances generally recognized as safe for use in food or food packaging.” Few controls exist for glove manufacturing relating to the reliability of raw materials and manufacturing processes, and costs can be reduced with the use of cheap, toxic materials.
  3. Medical grade gloves have to pass a series of technical tests in order to meet the safety requirements specified by the FDA. Gloves are tested for puncture and abrasion resistance, must meet tension and elongation tests and are also tested for chemical substance resistance. Manufacturers of these gloves must receive 510k certification. As this study shows, even medical gloves can contain high levels of toxic ingredients, affecting laboratory test results.
  4. The Acceptable Quality Level (AQL) refers to a quality standard for measuring pinhole defects- the lower the AQL, the less defects the gloves have. There are no AQL requirements for food grade or industrial grade gloves, meaning there are no guidelines for the number of failures per box. Medical grade gloves must have an AQL of 2.5 or less, meaning 2.5 failed gloves per 100 gloves is an acceptable level.
  5. For Californian cannabis companies, are your disposable gloves Prop. 65 compliant? Accelerator chemicals, such as 2-Mercaptobenzothiazole (MBT) found in some nitrile gloves, have recently been added to the Prop. 65 chemicals known to cause cancer.

How Gloves Can Contaminate Products

Physical, chemical and microbiological hazards have been identified in disposable glove supply chains. Gloves of any grade are not tested for cleanliness (microbial and bioburden levels), raw material toxicity and chemical composition, or pathogen contamination.

100% of glove factories supplying the United States are based in Southeast Asia. These factories are generally self­-regulated, with FDA compliance required for a rough outline of the ingredients of the gloves rather than the final product. Few controls are required for glove manufacturing relating to the reliability of raw materials, manufacturing processes and factory compliance or conditions. A clear opportunity exists for accidental or intentional contamination within the glove-making process, especially to reduce costs.

In order to safeguard their customers from product contamination, a selection of tests and certifications, some of which are unique within the glove industry, are being implemented by glove supplier Eagle Protect. These tests make sure Eagle’s gloves coming into the United States are made in clean, well run factories, free of any type of contamination and are consistent in material makeup to original food safe specifications. This glove Fingerprint testing program, consists of a number of proprietary risk reduction steps and targeted third-party testing methods, includes gas chromatography combined with mass spectroscopy (GC/MS); surface free energy determination; in vitro cytotoxicity analysis; and microbial viability-linked metagenomic analysis.

With a great deal of faith placed on a glove supplier’s ability to deliver disposable gloves sight unseen, we believe these tests are essential to further reduce risks or pathogen contamination associated with them, keeping your cannabis products safe.

The post Disposable Gloves: The Unregulated Cannabis Threat appeared first on Cannabis Industry Journal.

Why International Trade Agreements Are Shaping The Cannabis Industry

Why International Trade Agreements Are Shaping The Cannabis Industry

Original Post: Cannabis Industry: Why International Trade Agreements Are Shaping The Cannabis Industry

[Canniseur: This is the big picture view of international cannabis sales. The big cannabis businesses that enter the International market are being held accountable within the new MRAs.]

New international trade agreements on pharmaceutical quality and inspection are a big driver for the map of the modern cannabis industry globally.

If you have wondered over the past several years, why the big Canadian companies (in particular) are following the global strategy they are, there is actually a fairly simple answer: Newly implementing trade agreements, particularly between Europe and North America.

More specifically, they are highly technical trade agreements that are also called Mutual Recognition Agreements, (or MRAs).

In fact, look at the schedule of the MRA agreements signed between the U.S. and individual EU countries over the last several years, and it also looks like a map of the countries that have not only legalized at least medical cannabis, but where the big Canadian companies (in particular) have begun to establish operations outside of their home country.

But what is going on is actually more than just CETA-related and also will affect cannabis firms south of the Canadian-U.S. border.

All of these swirling currents are also why the most recent MRA to come into full force in July this year, between the U.S. and Europe, is so interesting from the cannabis perspective. Even before federal reform in the U.S. If this sounds like a confusing disconnect, read on.

What Are MRAs?

MRAs are actually a form of highly specialized trade agreement that allow trading countries to be certain that the pharmaceuticals they purchase from abroad are equivalent to what is produced at home. This includes not only ingredients but processing procedures, production plant hygiene, testing, labeling and more.

When it comes to the  EU-US MRA agreement, this means that individual states of the EU can now recognize the American Food and Drug Administration (or FDA) as an effective federal regulator of American pharmaceutical production that is equal to the procedures in Europe. US GMP standards, in other words, will be recognized as equal to those of EU states.

This will now also, by definition, include GMP-certified medical cannabis formulations.

What is so intriguing, however, is how this development will actually place certain American (and Canadian) manufacturers in a first place position to import cannabis into Europe ahead of the rest of the American cannabis industry.

What Are Mutual Recognition Agreements All About?

One of the most important quality and consumer safety aspects of establishing a clean supply chain is tied up in the concept of GMPs (Good Manufacturing Practices). These are procedures, established by compliant producers of pharmaceuticals, to ensure seed (or source) to sale reliability of the medication they make. In the cannabis industry, particularly in the advent of Canadian-European transatlantic trade in cannabis, this has been the first high hurdle to accept and integrate on the Canadian side.

GMPIf European countries recognize a country’s GMP certifications are equivalent to its own, in other words, and cannabis is legal for export, a country can enter the international cannabis market without facing bans, in-country inspections and the like. In the interim, imported products still have to be batch tested until the agreements are fully accepted and operational.

Israel, for example, already had an MRA with the EU, and medical cannabis is legal in the country. However, Israel was prevented from selling cannabis abroad until a legislative change domestically, passed on Christmas Day.

That is why the MRA agreement between the US and EU with Canadian companies in the middle also put both Israeli and U.S. firms at an extreme disadvantage in comparison. Both in entering the market in the first place, and of course associated discussions, like the German tender bid. That is now changing- and as of this year.

A Specialized Map Of Global Medical Cannabis Exporters

Ironically, what the new US-EU MRA could also well do is create a channel for pharmaceutical cannabis from the United States to Europe (certainly on the hemp and CBD front) just as Israel is expected to enter the international cannabis export industry (later this summer or fall). It could well be also, particularly given the Trump Administration’s tendency to want to not only “put America first” if not pull off “a better deal” in general and about everything, that this is why President Trump offered the delay to Israel’s president Benjamin Netanyahu in the first place.

Regardless of the international individual developments and subtleties however, what is very clear that from the time the first bid stalled in Germany in the summer of 2017 until now, the U.S.-EU MRA has been in the room even if not named specifically as a driver.

For example, the FDA confirmed the capability of Poland and Slovenia to carry out GMP inspections in February of 2019.  It was only last fall that Aurora pulled off its licensing news in the former (on the same day licensing reform was announced by the government). Denmark was recognized in November of last year during the first year of its “medical cannabis pilot progam.” Greece was recognized in March 2018. Italy, Malta, Spain and the UK came online in November of 2017.

Overlay this timetable with a map of cannabis reform (and beyond that, cannabis production) and the logic starts to look very clear.

The upshot, in other words, is that while cannabis still may be “stigmatized” if not still “illegal” in many parts of the world, more generalized, newly negotiated and implementing, specialized global trade agreements between the US, Europe and Canada in particular have been driving the development of certain segments of the cannabis industry globally and since about 2013.

The Biggest News?

As of this year, as a result, expect at least from the GMP-certified front at least, that such international trade will also include medical cannabis from the U.S.

Want an example of the same? First on that list if not early in the game will now undoubtedly be Canadian-based Canopy Growth, with Acreage on board, headquartered in New York.

The post Why International Trade Agreements Are Shaping The Cannabis Industry appeared first on Cannabis Industry Journal.

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