Hemp farmers will serve as a critical link in the launch of New York’s adult use cannabis industry. A total of 52 of New York’s hemp growers can now legally plant the seeds for what will become the first harvest of cannabis sold in one of the world’s biggest adult use markets.
On Thursday, the Cannabis Control Board, within the Office of Cannabis Management, met and formally approved these conditional licenses. These new license types available to hemp growers and processors are called the “Conditional Adult-use Cultivator License” and “Conditional Adult-use Processor License.” Regulators also gave an update on the social equity fund and revised home grow rules.
The 52 licensees were selected from a pool of more than 150 applicants, regulators said.
In February, New York Gov. Kathy Hochul signed a bill to allow hemp farmers to cultivate and distribute cannabis for adult use ahead of the broader launch of the state’s adult use industry. Hochul said on Thursday that the awarding of these licenses “advance the Seeding Opportunity Initiative,” which she announced in March.
“It’s been a very busy six months and we’re proud of our progress thus far,” Tremaine Wright, chair of the CCB, said during the meeting, referencing among other things, the expansion of the state’s medical cannabis program.
Importantly, the bill was signed ahead of the 2022 growing season, which, for upstate New York, can bring snow in April and also in October, requiring hemp farmers to take advantage of a window of cultivating opportunity.
“We understand that the growing season waits for no one, and we have to move quickly to help our farmers take full advantage of it,” said OCM executive director Chris Alexander.
The creation of these licenses provided “a pathway for existing New York hemp farmers to” submit an application to grow cannabis for adult use during the 2022 growing season, Hochul said in an announcement in February.
The OCM will continue to review and recommend applications for approval on an ongoing basis. The application window closes on June 30.
Until now, a hemp grower license holder could only cultivate cannabis plants containing .3% THC or less, the regulatory differentiator between “hemp” and “marijuana,” though both are cannabis. Cultivators will be allowed to grow high-THC cannabis and distribute the cannabis flower, while Processors will be able to manufacture cannabis extracts, for example, and infused products. Both license types are “required to participate in an environmental sustainability program and a social equity mentorship program,” according to Hochul. These licenses will be short-term bridges; they will be allocated until December, and will be valid until next year, after which these licensees would have to apply under the adult use program.
New York’s hemp farmers have seen their businesses battered over the past few years, as Cannabis Wire has reported. When New York launched its hemp industry, there was a rush in demand for cannabidiol (CBD) products, and subsequent rush toward hemp planting and production of these products, which led to a glut that sent prices crashing. Meanwhile, a delay in rules further hurt their bottom line. Some farmers didn’t make it out of this time period and hung up their businesses. Of the ones that have held on, many are only barely doing so, Cannabis Wire has reported.
It was “kind of a perfect storm, in terms of COVID and then also the lack of regulations and oversupply of hemp on the market, both in New York state and nationally,” Allan Gandelman, president of the New York Cannabis Growers & Processors Association, told Cannabis Wire in June 2020. “Some farmers have decided not to grow hemp this year. And some farmers have decided to scale back, which is very different from 2019, when people were scaling up their operations and growing a lot of acres across the state.”
So it’s in this climate that hemp farmers are taking another chance on growing in New York.
New York Assemblymember Donna Lupardo, one the state’s loudest legislative supporters of the hemp industry, told Cannabis Wire in February that her “main objective” was to help the hemp farmers who got involved in New York’s industry in its earliest days, or the people Lupardo calls “risk takers.”
“Here they are with the experience, the knowledge and expertise, and the interest in mentoring. It seems like just a positive win all around in my view,” Lupardo told Cannabis Wire.
