Arkansas’s increased cannabis production won’t solve the industry’s affordability issue
The cbd stocks to watch is a cannabis industry issue that has been present for a while. Arkansas’s increased production won’t solve the issue because of the high cost of producing CBD oil.
River Valley Relief Cultivation, which will begin on Old Greenwood Road on Oct. 1, will be the River Valley’s first medicinal marijuana growing facility.
Amendment 8, which was approved by voters in 2016 to allow medicinal marijuana, restricts the number of producers in the state to eight, according to Scott Hardin, director of communications for the Arkansas Department of Finance and Administration. The state’s quota of eight growers has been achieved.
Grady and Hot Springs, as well as Fort Smith, were authorized to cultivate cannabis in 2020. Pine Bluff, Cotton Plant, Newport, Berryville, and White Hall were among the 2018 authorized cities.
Amendment 8 sets a cap of 40 dispensaries throughout the state. The state has approved 38 dispensary licenses to sell medicinal marijuana. The state is split into eight zones, with up to five dispensaries in each zone.
The River Valley is part of Zone 4, which includes five dispensaries: Fort Cannabis Co. (Fort Smith), Enlightened Cannabis for People Clarksville (Clarksville), 420 Dispensary (Russellville), Enlightened Cannabis for People Morrilton (Morrilton), and 3J Investments (Lamar). 3J has applied to operate in Van Buren, but the city council and the Medical Marijuana Commission must both approve it.
Despite the state’s legalization, there are worries that medicinal marijuana would be unavailable due to its high cost.
The increase in supply alone, according to Kristy Floyd, director of operations at River Valley Relief Cultivation, will not address the cost issue. One of the barriers to cost, she said, is that insurance companies would not cover medicinal marijuana since it is illegal at the federal level.
River Valley Relief Cultivation will feature a Compassionate Care Program to assist people who cannot afford medicinal marijuana as a method to improve affordability. The program’s specifics, according to Floyd, are still being ironed out.
The average cost of a gram of marijuana in Arkansas is $15, according to Weedmaps. It costs $10-$20 per gram in Missouri. The only state bordering Arkansas where a cannabis pricing index was accessible was Missouri. Colorado’s average price is $12, whereas Washington’s is $10. Colorado and Washington were among the first states to legalize marijuana for medical and recreational purposes.
Cannabis is taxed.
There are 79,019 medical marijuana cards in Arkansas, including 8,514 medicinal marijuana cards in the River Valley.
Medical marijuana cards in the River Valley by county:
- Logan County has a population of 418 people.
- Sebastian County has a population of 2,848 people.
- Crawford County has a population of 1,620 people.
- Franklin County has a population of 344 people.
- Johnson County has a population of 644 people.
- Pope County has a population of 1,357 people.
- Conway County has a population of 908 people.
- 375 people live in Yell County.
In addition to the 6.5 percent sales tax, Arkansans must pay a 4 percent privilege tax on cannabis transactions, which was enacted by the legislature.
Patients pay the privilege tax when they purchase from a dispensary, and dispensaries pay it when they buy from farmers. When purchasing cannabis from farmers, however, dispensaries are free from paying the 6.5 percent state sales tax.
The state has received $47 million in sales tax from the 60,000 pounds of goods sold since 2019, with $23 million arriving in the last nine months. Cannabis sales generate approximately $3 million in tax income for the state each month.
The National Cancer Institute at the University of Arkansas for Medical Sciences in Little Rock and the Medical Marijuana Commission both benefit from the privilege tax.
Data on how much sales tax is produced per area, according to Hardin, is unavailable. The Tax Procedure Act makes regional statistics inaccessible by keeping the amount of sales tax collected by businesses private. Only the total sales tax income received by the state from cannabis may be provided.
Since opening on December 18, 2019, Fort Cannabis Co. has sold 2,554.48 pounds of cannabis. The dispensary produced 116.32 pounds in August. Nearly 4,300 pounds of medicinal marijuana have been sold in Zone 4, which covers the River Valley.
According to Statista, legal cannabis sales will earn $23 billion in taxes in the United States by 2025.
Arkansas is one of 36 states where medicinal marijuana is allowed.
Cultivation in the River Valley
River Valley Relief Cultivation will utilize 25,000 square feet of indoor growing area for cannabis when it starts on Oct. 1. There will be 2,000 plants in each of the seven growing rooms.
River Valley Relief Cultivation, which will be situated on Old Greenwood Road, may bring in $80 million to the local economy over the next four years and provide 80-100 jobs, according to an economic analysis conducted by the Arkansas Cannabis Industry Association.
According to the company’s website, it will also assist educate patients about opioids and conduct research into the role of medicinal marijuana in combating the opioid crisis.
According to Floyd, 90 percent of the water used to produce the plants will come from converting humidity in the building to water, which is a technique used in hospitals. This, according to Floyd, reduces the quantity of water the facility consumes from the city.
The extraction procedure on the plants will be carried out in a C1D1 shelter, which is a chamber designed to handle volatile liquids and gases.