The production of marijuana in Oregon is so high that the Oregon Liquor Commission estimates that the available inventory can address the supply needs of the state for nearly 7 years if demand remains at the current level. This overproduction has prompted lawmakers to consider exporting the excess cannabis to other jurisdictions where recreational marijuana is legal.
Senate Bill 582 is a preemptive step aimed at getting Oregon ready to move fast once the federal government relaxes its marijuana laws. Currently, marijuana is a schedule 1 controlled substance which cannot cross state lines.
Cannabis law reform at the federal level is expected to take one of two forms in the foreseeable future. First, the States Act which is before Congress seeks to get federal recognition that states have a right to make and implement their own marijuana laws without interference from the feds.
Alternatively, a statement by the Justice Department to the effect that the transfer of marijuana between states wouldn’t be a “priority for law enforcement” at the federal level can be interpreted to mean that states which have legalized marijuana can trade the substance between themselves.
Mike Getlin, a cannabis law reform advocate, says that should marijuana trade between states become a reality and Oregon isn’t poised to jump right in from the very onset, then a delay of even six months would be sufficient to knock the state out of contention as a major player in the interstate cannabis trade. Such an eventuality would flip the oversupply in Oregon from an asset to a major problem which can cripple the state’s cannabis industry.
SB 582 has provisions which would allow the Governor of Oregon to negotiate arrangements through which Oregon’s surplus marijuana can be sold to states where more supply is needed. The bill stipulates that only states where recreational marijuana is legal are eligible for an export and sale arrangement with Oregon.
Casey Houlihan, the head of the Oregon Cannabis Retailers Association, testified before the senate committee and revealed that the excess cannabis in Oregon will find its way to other states one way or the other, so it is better for mechanisms to be put in place so that the export can be done in a regulated way that brings revenue to state coffers.
Some of the cannabis companies that testified before the senate committee revealed that they had reduced their workforce by up to 80 percent because of the drop in marijuana prices due to oversupply within Oregon.
Wildflower Brands Inc. (CSE: SUN) (OTCQB: WLDFF) and Youngevity International, Inc. (NASDAQ: YGYI) look forward to a viable solution that can save the cannabis industry in Oregon from collapsing due to excess production.
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