The harvest in California was epic, as always, and the marketplace is now flooded with product. However, along with this year’s pot crops, the seeds of discontent were also sown: The price of outdoor pot is plummeting, and growers are getting anxious.

 

Story & photos by Dan Skye

 

“I’m trying to get out of it 100 percent,” one Northern Cali grower tells me. “I don’t wanna do it – I just don’t see any future in it at all. I don’t think I could take care of my family.

 

“Still,” this grower adds, “it’s so hard not to put out an outdoor crop, because it pretty much takes care of itself.”

 

It’s a warm October day up in Trinity County. This is outdoor-cultivation country: rugged and remote, but teeming with activity as the harvest season begins. This particular grower is taking a break. He’s hired a crew of three to help build a sturdy grow house in one corner of the 40 acres of Trinity wilderness he owns. Just a couple of hundred yards away from the construction site, his garden is standing tall, a picturesque patch of OG Kush glistening in the sun. He looks over at it and just shakes his head. 

 

“Man, when I first started out, I used to get $3,000 in the Bay Area,” he says wistfully. “That was eight years ago, so we’re talking about a one-third drop in price. Mom and pop? Fuckin’ everybody’s doing it … whole families are growing! It just seems that the number of outdoor grows triples every year. It went from one neighbor’s yard to three neighbors’ yards to five neighbors’ yards to the whole street – every single place. It’s just mass production.”

 

Welcome to the not-so-Golden State – at least when it comes to the outdoor marijuana market. Twenty-five years ago, growers could count on getting $5,000 or more per pound. But with the introduction of liberal medical-marijuana laws and the influx of thousands of new growers arriving to take financial advantage, the California cannabis industry is getting schooled on the laws of supply and demand. Even top growers – those with reputations for high-quality pot earned over years of growing – have seen their prices fall below $2,500 per pound. Often, they’ll settle for $2,000. New growers without connections can expect half of that – or even less.

 

In October, David Lampach, a co-owner and researcher at Oakland’s Steep Hill Lab, the top cannabis-testing facility in the US, forecast even more gloomy news for California’s outdoor growers. After the north coast was subjected to an unseasonably early heavy rainstorm in September, Lampach noted: “Early rains have a significant impact on the outdoor market. Expect higher incidences of mold contamination in the cannabis supply from this region. In addition, flower coloration is impacted by the increased moisture and cold temperatures that accompany a weather event of this magnitude. The low- and mid-grade outdoor markets, which were already poised to experience significant challenges this fall, will be even more hard pressed to recover from the crash-level price declines experienced over the last several years. Many buds that might have otherwise ranked as high-grade outdoor will slip into the middle and low grades. The bottom has fallen out for the low-grade market, and further price declines should be expected.”

 

Click here for Steep Hill Lab’s September/October 2010 Cannabis Industry Report

 

The glut of outdoor pot and consequent price drop has more than a few growers contemplating the idea of focusing on indoor only. This “crisis” is amplified by the fact that medical-marijuana dispensaries have lately demonstrated a strong preference for indoor product, giving credence to the myth that indoor pot is somehow superior to outdoor.

 

Erich Pearson, who runs the SPARC (San Francisco Patient and Resource Center) dispensary in San Francisco, is critical. “Dispensaries have not been educating the public,” he opines. “People are beginning to believe that indoor cannabis has a higher THC content. But the genetics of a plant remain the same whether it’s grown indoors or outdoors. We’ve grown the same seeds indoors and outdoors, and the THC level has remained the same. In fact, our outdoor Black Domina comes in at 18 percent, while our highest indoor product, an OG Kush, comes in at 16.5.

 

“People have not been told about the environmental benefits of growing outdoors. Dispensaries seem to prefer indoor because it’s a prettier product; outdoor pot is duller, not as glossy. But it’s not like outdoor pot is dirtier or even moldier. Steep Hill Labs, whom we rely on to test our products, states that there is no difference in mold content.” 

 

Coupled with the stronger market for indoor pot is the huge outdoor harvest statewide. Veteran growers commonly store their crops for sale in the spring and summer months, after the outdoor market has become less saturated. But these days, many Left Coast growers don’t have that option. Our nation’s financial meltdown has been especially cruel to California residents, who live in a state that is literally bankrupt. Jobs are scarce and money is tight, and countless cash-strapped Californians have gotten into gardening as a means of seeking some financial relief. Unfortunately, many growers can’t wait for better prices: They need cash for basic living expenses – mortgages, car payments, groceries – and they need it now! Consequently, prices in recent years have been doing a nosedive come autumn – sometimes down to a mere $700 per pound.

 

 

At the same time, while California’s outdoor harvest may have been enormous, it’s essential to note that the vast majority of these crops are shipped outside the state. “It affects the price of outdoor pot here,” a dispensary owner in LA points out. “The margins are higher for outdoor pot elsewhere because, the further you travel away from California, the less critical the eye is. Outside the state, the differences between indoor and outdoor aren’t that significant – provided that the product is decent outdoor, the margins remain high for outdoor pot sold out of state. As the outdoor pot dries up, dispensaries are forced to buy indoor pot all summer long. So when the outdoor season arrives, they’re looking to make up for lost margins by taking advantage of the glut of outdoor product.”

 

A NorCal grower who’s sold product to dispensaries for years reports: “Everybody just wants us to leave samples. If you had indoor, they’d take it right then.” But with outdoor, he says, it’s “Not today, we’ll call you back.”

 

This grower adds: “Even down in Southern California, it’s gotten tough. Fresno and Bakersfield, the farmlands, they’re bringing in tons of outdoor. There’s a lot being grown in the foothills. People are coming in with suitcases full of outdoor. Get this: I know a grower who just sold a 10-pack of Snowcap [10 pounds] for $15,000. It was pretty decent stuff, and he only got $1,500 a pound – and he had to deliver it! Times have changed.”

 

Given this situation, who could possibly blame outdoor growers (with the obvious exception of law enforcement) for selling their crops out of state? Guerrilla growers in NorCal say that prices haven’t changed in years, with their product fetching anywhere from $3,500 to $4,500 per pound. However, wherever pounds are being sold, it’s usually the middleman making the most money. The downward pressure has been solely at the wholesale level – and, sadly, the consumer doesn’t appear to benefit.

 

“The middleman is what screwed California pricing,” says B.E. Smith, a NorCal veteran with 30 years of cultivation under his belt. “We used to be real paranoid – you had the same buyer for years. Then, all of a sudden, legal medical pot came in, and the buyers could start buying it from other people cheaper. Remember, whoever buys it for $800 from the growers is still going to get a good price for it. So outdoor pot hasn’t ‘failed’ – I mean, do they have a survey on all the guerrilla growers and how much they’re getting selling it outside the state?”

 

Smith includes California’s dispensaries in that “middleman” category: “If there’s been this huge drop in prices, how come it’s not being passed on to the consumer?”

 

To be fair, the overhead for growing indoor crops is far higher than an outdoor garden. But Smith isn’t buying it.

 

“Years ago, I said that we should be able to grow pot for $500 a pound. And I would still grow $500 a pound – if I could get the dispensaries to promise that there would only be a certain amount of markup. There’s nothing compassionate about some of them bastards … not a damn thing. They’re preying on patients,” he says flatly.

 

 

But while many complain of the precipitous drop in outdoor prices, others merely shrug.

 

“Even if it goes down to $1,000 a pound, it’s still worth it, isn’t it?” says a Mendocino County grower. “A friend of mine figured out that if he was getting $60 an ounce, it would still be better than going and doing construction. Hell, you bring in a hundred pounds, even after your overhead for trimmers and such, it’s still worth it.”

 

Some growers see a whole new danger lurking down the road. “If the Central Valley farmers ever get involved, we’re out of business,” says one in Humboldt County. ”I mean, they got the irrigation systems already from the vegetables they grow; they’re ready to go. What does it take to put clones in instead of tomatoes? A bunch of five-pound plants just rowed up like corn? It’s scaring the shit out of me!”

 

Even so, some growers are far more sanguine. “There’s going to be a ‘weeding out’ in the industry, if you will – or, to make another pun, a shakeout,” says one of the more optimistic farmers I talked to. “And it will be good for the industry.”

 

In fact, David Lampach of Steep Hill Lab believes that in the future, the entire industry will move to greenhouses. “At what point is it not economically feasible to grow indoors?” he asks. “Can it compete – especially when people come to understand that greenhouses produce terrific plants?”

 

And if new standards for quality (and quality control) add a new degree of legitimacy to the industry, then the best growers will certainly benefit – which means the consumer will benefit as well. Though these costs will inevitably be passed on to the consumer, the new product should not only be better, but also dependably, consistently better.

 

And at this point, although growers say they’ve experienced downward pressure on prices for the last 10 years, quality is what’s being lost in the equation. A successful Mendocino grower reminds everyone that “pot isn’t all the same” – which may seem obvious to most readers of HIGH TIMES, but let’s hear it one more time.

 

“It’s like bad wine compared to fine wine,” this grower says. “So when we talk about things that go for $700 a pound – sure, out there, and I’ve even heard $600 – but what is that? We have neighbors that are very basic people: They’re not [professional] growers, but they grow bud. And the variation in quality is huge.

 

“That’s the bottom line. It’s like buying anything else – you can buy crummy-grade apples or number ones, the ones you want. But the issue of indoor versus outdoor? It doesn’t matter where it’s produced or what it is­; the consumer is the final judge of quality and price. So if you have a competitive product, you’ll do fine.”