Doc, been wondering about this... how do you feel water restrictions will affect business in your neck of the wood/state?
Will it literally dry up some grow operations, legal or other,, and since you're discussing price,, what will the water restrictions do to that? Thank you!
That's a really good question and I'm not sure what effect will be.
In many ways, cannabis is fungible, IE a pound of expertly grown OG Kush from norcal can be exchanged for a pound of expertly grown OG Kush from Socal.....so the market price is determined over a large area.
Lots of growers have wells, especially in the rural areas, so they won't be effected by water rationing.
My place is served by a very small water district that has its own wells......and really poor water since the aquifers haven't been recharged for a while.
The price of water is going to go UP......but market forces are broader than the price of just one single commodity.....so I suspect that prices will continue downward, profits will be harder to come by, and growers will be squeezed a bit.
While I don't think the water shortage is a good thing in any way.....I do appreciate the market driving prices down for a couple reasons:
1. All that cheap weed means people have more money in their pockets to splurge on the really good stuff. (mine)
2. lower margins will drive marginal growers out of business....this will increase the quality and value of the products brought to market....a good thing.
3. Fewer growers=more buyers
My focus on quality has paid off for me. When I started growing, top-shelf went for 3200 lb. Now, top-shelf is going for 24-2600lb locally.
I'm still getting 3200 lb. all day long!
Now, when everyone else starts growing to that level, prices will again come down....as they should.
The real game changer will be legalization.
