Hi Golden eagle, Thanks for your input. They are some respectable credentials you have and an interesting field of work you are in. Although I appreciate your take on things, I struggle to find your post credible. I will explain why my bullshit detector keeps going off when pondering your post:
”The quality of Canns grow has been problematic at Southern for many years and they have been slow to address it”
I have seen several photos from the early days that show epic heads, that look like absolute dynamite. So they must have been doing something right from the early days. Cann’s southern facility was its pilot grow space with various grow rooms, designed for research and trial and error (like you mention) with the many variables of plant cultivation. They have been operating in this space for near on 5 years (a heck of a long time to build solid science around their novel cultivars). They also have a northern greenhouse which is a pure research facility and have been operating there for several years. The vic government was growing in the southern facility initially and providing medical product to epilepsy patients before cann took over. The whole point of these facilities was research and to perfect the cultivation of their genetics in order to transfer this intelligence to the bigger facility. Along with their strong partnerships with ag vic and la Trobe uni, I am unable to accept that they are not “master growers” of their cultivars by now.
“Growing large quantities of cannabis is not easy”
We are talking about a weed. Black market growers have been planting acres of the stuff in remote areas and checking on it once a week, or perhaps having just a single human there monitoring the progress. This product has made plenty of stoners happy over the years. Growing weed is not rocket science. And even the most basic grows will yield buds with a cannabinoid profile (just ask anyone over at ecs or any outdoor black market grower). However, I firmly believe if you have the science and control over the grow, which Mildura will offer, then you will get much more out of your harvests (both higher yield and higher cannabinoid profile).
”much bigger facility, new technology they've never dealt with before, and new staff who will be cheaply paid casuals with no cannabis experience”
I agree the transition to Mildura will present its challenges and it will take a few harvests to get the “perfect harvest”, but nonetheless they will be producing solid buds with a solid profile from the outset. We will find out who is right in the next few months, once the initial harvest is complete. Of course there is a risk of a major failure that might jeopardise the initial grow, but highly unlikely. Low paid casual cultivators are entirely appropriate in such a facility. As are highly paid cultivators. Think of a commercial kitchen in a fine dining restaurant. Do you think all the chefs need to be culinary experts? No. You would have highly paid chefs, middle of the range, and then the low paid youngens who are there to learn and develop and gain experience. I think trimming leaves off plants is a task that a uni graduate could do quite successfully whilst getting exposure and experience. No need to pay them the same as the “lead cultivator”.
“I think it would be unrealistic to expect them to get medical quality bud coming out of there this year”
What is medical bud? I would say medical cannabis is that which is grown and manufactured under GMP conditions and meets all the requirements of the TGA. Mildura will be doing exactly this! What you are getting at with this comment is their initial grows will yield no cannabinoids, and therefore they will be unable to extract anything to put in their capsules. Geez that would the funniest thing I have ever seen if that happened! They will get cannabinoids out of their plants from the outset. I also think they will have nice flowers that would be attractive to a smoker. Maybe not with a 100% profile the genetics offer but still a great profile none the less.
“The other major concern is how are they going to sell all that flower”
This is the critical point. Time will tell if they can or not. They have a number of products in the pipeline and these will start dropping on the market in the years to come. First cab of the rank is the S3 product. I think there is a real chance this product alone could drive capacity of stage 1a. The 50mg capsule has 1500mg per pack of 30. Let’s say their cbd cultivars yield 15% (I don’t know, just a guess, I am aware thc yields are in the high 20s, but I have not seen cbd yields anywhere near as strong). That’s 10 grams a pack. 1,200,000 packs = stage 1a capacity. Let’s assume Regular users of cbd oil would buy 12 packs a year (1 a month), that translates to 100,000 consumers needed. Quite possible in my mind. Then obviously there are all the other products being developed which will hit the market in the future.
“IMO, a market that size for expensive bud with the label 'medicinal' just ain't there yet”
How did you determine that they will be producing expensive bud? They will grow the bud at $1 a gram and then do the extraction and/or manufacturing in house. IMO, They will be competitive with any producer anywhere in the world.
“There are much better speculative opportunities out there”
That’s great. I hope you do well on them. Personally, I believe cann will leave the Australian competition behind in the coming 18-24 months. There are a few others that could be successful, but cann has all the ingredients in place and is now starting to put it all together. IMO, Thier potential is second to none in the Australian space. If interest rates go up as aggressively as analysts are predicting, I think it will wipe out a few players. The industry is facing a horrid outlook and companies will need to be profitable soon to make it through. The Mildura facility will need to deliver the performance management is expecting otherwise we are toast. I am a believer and optimistic that it will work out as expected.
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