Retail marijuana sales start in state next week, but don't expect outlets on Peninsula yet

By Joe Smillie
Peninsula Daily News

Only two labs in state to test marijuana for sale

By Gene Johnson
The Associated Press

SEATTLE — Randy Oliver has a pressing question as legal marijuana sales are about to begin in Washington state: Where's all the weed?

Oliver is the chief scientist at Analytical 360 in Yakima, one of two labs in the state that have been certified to test the heavily taxed marijuana that will wind up on store shelves next month.

So far, just two licensed growers have turned in samples for testing at Analytical 360, with another due to turn in a small batch this week, he said.

“There's such a small stream of samples coming through,” he said. “There's going to be some long lines and some high prices.”

The state's Liquor Control Board has been warning of shortages when the first stores open.

The board plans to issue the first 15 to 20 retail licenses Monday, July 7, with shops allowed to open the next day if they're ready.

It's not clear how many that will be. Board staff said at a meeting last week that only one store in Seattle is ready for its final inspection.

Only 79 of the more than 2,600 people who applied for marijuana growing licenses last fall have been approved, and many of them aren't ready to harvest.

[On the North Olympic Peninsula, only three production and processing facilities have been approved from the 128 who applied for state licenses.

[They are Alpha Budz in Forks, Peninsula Cannabis in Port Angeles and TropicGrow in Sequim.

[The Liquor Control Board allotted 10 retail shops on the Peninsula: two in Port Angeles, one in Port Townsend, one in Sequim, three anywhere in Clallam County and three anywhere in Jefferson County. ]

“Will there be shortages?” Randy Simmons, the board's legal-pot project manager, said. “The answer to that is yes.”

But the figures provided by Oliver Saturday suggest just how serious those shortages could be.

The samples provided to Analytical 360 represent a maximum harvest so far of 190 pounds — and Oliver said he expects 20 to 30 percent of the samples to fail because of high mold counts.

Marijuana associated with those samples can't be sold as dried bud, but can be used to make cannabis oil.

The amount harvested so far “isn't going to stay on the shelves very long,” Oliver said.

The other certified lab, Confidence Analytics in Seattle, has received samples from nine growers, some of whom are working on their second harvests, said co-owner Bobby Hines.

Thomas Ash, owner of Sequim's TropicGrow, said his first crop won't be in stores until August. The other growers could not be reached for comment.

Oliver said he's worried that his lab could see a crush of samples provided in the days before the first stores open, swamping his lab and delaying the arrival of product on store shelves.

“We can probably handle 100 samples a day, but if we get 300 samples thrown at us?” he said.

“I'm worried about everybody coming to us at the last minute.”

Growers have to provide samples for every strain of cannabis they grow and for every five pounds of flowers they harvest.

Oliver also said glitches with the software the state is using to track the bar-coded marijuana from clone to sale could compound the issue.

He said his lab has had trouble entering test results in the program, and some marijuana that passed has shown up as having failed.

It took one grower five days to provide the samples to the lab because of software problems, he said, characterizing the bugs as nothing unusual for a new program.

Seattle's Sea of Green Farms is one of the two growers who have had their pot tested at Analytical 360, said Bob Leeds, a partner there.

The other grower tested is Spokane's Kouchlock Productions.

Kouchlock and Sea of Green were among the very first growers licensed back in March.

Spokesmen for the liquor board did not immediately return a call or emails.

The Sea of Green team spent last weekend packaging the approximately 40 pounds of marijuana it harvested recently, Leeds said.

It has contracts with four shops to sell most of it already — for an exorbitant $4,000 a pound.

That's nearly $9 per gram before the retailer's mark-up, 25 percent retail excise tax, and state and local sales taxes.

At the state's unlicensed medical dispensaries, cannabis often sells for $8 to $12 per gram.

“When people start calling, we have to tell them we're not going to have anything for them until August,” Leeds said.

“That's a long way off when you're trying to open a business.”
SEQUIM –– A shortage of marijuana to stock new recreational pot stores should have little impact on potential owners of the North Olympic Peninsula's 10 retail outlets, many of whom don't expect to be open when sales are allowed to begin next Tuesday.

“We're having our first inspection from the state Monday, and looking at all this paperwork, we're probably going to have a lot more to go through after that,” said Wendy Buck-Benge, who with her husband, Nicholas Benge, was selected in the lottery to run one of two Port Angeles stores.

Other potential pot purveyors said they wouldn't be set to open next week either.

“I would like to say I'll open up next week, but it's going to be a while before I can even begin to work on my building,” said David Halpern, whose Emanon Systems was selected in the lottery for Sequim's sole retail outlet.

He intends to set up the shop at 755 W. Washington, Suite C, but the space is currently occupied by an Edward Jones financial services office that will stay there until August, Halpern said.

At that point, Halpern will have to remodel the site to comply with strict state security standards.

“And then I still have to wait to see what the city wants to do,” he said.

A city-implemented six-month moratorium on marijuana businesses in Sequim city limits will be up for review by the council in August.

Delayed openings may be fine, as there may not be a local crop ready to stock the shelves.

Jean Davis, who has been growing marijuana with her husband, Thomas Ash, in their TropicGrow barn at Dungeness since receiving producer and processor licenses April 1, said their production has been delayed by learning how to grow the finicky plant.

“It will have to start off without us,” she said.

“It grows like a weed, but a weed that needs constant attention.”

The first TropicGrow crop of 150 plants will be ready for market in August, with another ready in September.

That first crop already has plenty of demand, Ash said, as the couple has fielded calls from several potential retailers who have offered to buy their entire crop.

High demand for a limited supply of legal marijuana is driving up prices people are willing to pay for the first TropicGrow crop, Ash said.

“It's going to be the wild, wild west for a while,” Davis said. “Hopefully it doesn't turn into an eBay type auction situation.”

Ash and Davis said they don't intend to jack up prices in the limited supply-high demand marketplace, saying instead the demand allows them to select retailers with whom they feel comfortable forming a long-term supplier relationship.

“We want to have a predictable price, something that is fair over time,” Ash said.

“I want to be in a long-term industry, not a gold rush.”

________

Sequim-Dungeness Valley Editor Joe Smillie can be reached at 360-681-2390, ext. 5052, or at jsmillie@peninsuladailynews.com.

Last modified: June 30. 2014 7:10PM
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