As emerging cannabis markets grapple with balancing supply and demand, some are experiencing gluts, while others are facing crippling shortages. When legalized recreational marijuana hit store shelves in Canada, the country almost immediately faced a major shortage that resulted in people flocking to cannabis dispensaries like a Black Friday sale. Meanwhile, Oregonians are practically swimming in legal weed. Now, news has come to light that California may run out of legal marijuana as soon as this summer, reports Leafly.
“Right now, thousands of farms operate under temporary licenses from the California Department of Food and Agriculture (CDFA). Those 6,924 temp licenses are expiring faster than the CDFA can issue permanent annual licenses. Also, those temp licenses can’t be extended unless existing law is tweaked,” says Leafly. This means that the existing supply could start drying up this spring and be completely gone this summer unless California acts fast.
Cannabis attorney and expert Omar Figueroa told Leafly “If California runs out of regulated cannabis, consumers will turn to the unregulated market, making it even more difficult for the few remaining licensed cannabis businesses to eke out a living.”
And the situation could get dire unless the CDFA starts issuing licenses fast. Lauren Mendelsohn, an associate at Figueroa’s law offices, said “The world’s largest legal cannabis industry is on the verge of collapse.”
The California Legislature has recently published a bill that would temporarily rectify this by keeping cannabis farms open as they await permanent licensing. But the ultimate solution of this problem is for the California Department of Food and Agriculture to start more rapidly issuing cannabis licenses, and perhaps even streamline the licensing process. Since November 2016, the CDFA has only issued nine annual cannabis farm licenses, while another 39 are pending payments of fees, which can run as high as $44,000.
The problem is that the process of getting a permanent cannabis license approved in California is quite complicated, requiring high fees and strict environmental reviews. Bureaucratic red tape has bogged down cannabis license submissions and approvals, with the annual farm license application running to 44 pages long and requiring approvals from many different state governmental organizations.
Naturally, the CDFA says they’re doing everything they can to expedite the growth of the legal cannabis market in California. Rebecca Foree, CDFA communications manager, said to Leafly “The top priority of CDFA’s CalCannabis Cultivation Licensing Division is to process as quickly as possible the annual cannabis cultivation licensing applications. We are here to help applicants understand how to submit accurate and complete applications, which in turn will help speed up the application review process.”