As licensed cannabis companies struggle to match the lower prices of the legacy industry, many are shifting focus away from expensive indoor greenhouses and adding outdoor grow locations.
CannTrust Holdings Inc. (TSX: TRST; NYSE: CTST) recently closed the acquisition of 81 acres in British Columbia for an outdoor grow, and is now awaiting Health Canada approval before beginning operations.
Today the company announced that irrigation and security are already in place while awaiting that licensing approval, with up to 15,000 kg of cannabis expected to be cultivated by the end of the year. That represents a huge drop from CannTrust’s initial estimation of harvesting 75,000 kg when the land sale was first announced.
If Health Canada licensing is not received before the beginning of August, however, that new outdoor location may actually produce nothing at all in 2019.
Discussing that significant reduction in expected output for outdoor growing this year, CannTrust Chief Executive Officer Peter Aceto commented:
That referenced strategy includes an extra 160 acres of land the company is currently in negotiations to lease for planting in the 2020 growing season.
While a stigma originally surrounded outdoor grows as the legal industry got up and running last year, more companies are adding outdoor space to complement their high-tech indoor facilities that haven’t met demand for high quality, low price products.
Canopy Growth Corporation (TSX: WEED; NYSE: CGC) for instance just received licensing for an outdoor grow location in Saskatchewan, which is also getting up to speed late in the planting season and serving as a test run for the 2020 season.
In other recent CannTrust news, the company is joining a growing number of North American cannabis entities jumping into the U.S. CBD market.
Last month, CannTrust announced the creation of a 50/50 joint venture with California-based Elk Grove Farming Company to convert hemp into CBD oil for sale across the U.S. Those products are expected to begin hitting shelves starting in 2020 after the first batch of cultivation and extraction occurs.