panaceachronicles

Oregonians smoke 11.1 Million grams or 390,000 ounces of tobacco products a day. That puts Tobacco sales in Oregon over 4 Billion grams, or almost 9 million pounds of tobacco products a year. Californians smoke 62.3 Million grams or 2.3 Million ounces of Tobacco products a day. The amount of tobacco product smoked in California in a year almost requires an exponential expression – 22,739,500,000 grams a year. 

How many of those 4 Billion grams a year are being grown by Oregon Cannabis growers? How about the 22 Billion a year in California?

How many of those 11.1 million grams a day in Oregon are heirloom tobacco varieties like Mopan Mayan, Mount Pima or Aztec Rustica?

How many have such individualistic aroma and flavor profiles that they match beautifully with unique Oregon-grown Cannabis terpene profiles?

How many are being sold alongside Oregon’s premium Cannabis in Oregon dispensaries?

How many of those grams are “medicinal Tobacco” – and what could a new designation like that mean?

I think it’s quite possible that some of those 11.1 million grams a day can be authentic heirloom tobacco, grown both indoors and sun-grown as a complementary crop by skilled Oregon Cannabis growers. I think it can sell at $3.50/gram, $100/ounce retail implying gross farm revenues of $30/ounce or $480/pound at wholesale, with strong retail-price web selling options.  

A market of 9 million pounds a year at $480 a pound represents a theoretical total for on-farm revenues of $4.5 Billion per year. A fraction of that amount would still represent a major new agricultural opportunity for Oregon growers. 

As a point of comparison, Santa Fe Natural Tobacco buys 1.7 million pounds of organic tobacco a year from 100+ growers worldwide for manufacturing just the American Spirit organic cigarette brand. None of the SFNT’s other natural brands are organic tobacco. As you can see, even American Spirit organic cigarettes total tobacco demand for worldwide production amounts to only a tiny fraction of just Oregon’s own tobacco consumption. There may be a lot of room in local, state and regional markets for new heirloom tobacco/cannabis brands that can begin very small at the farm producer level.

I think $25,000 a quarter acre (500-600 cured pounds) is reasonable if the untapped market is anything like what I believe it is. An existing cannabis grower can find out pretty quickly. Just put in a couple each of maybe six different heirloom tobacco strains off to the side, raise them and cure them out using traditional methods, then do a nice blend with your cannabis flowers (or trim) and try it out locally with maybe a few hundred people. Find out what they think. Get an idea of what they will pay. After doing that, any cannabis grower would know for sure what the local market is for heirloom tobacco at virtually no cost to find out.

Maybe This Is A Timely Opportunity

Cannabis and Tobacco are such a natural pair in the marketplace and in peoples’ lives that it makes sense, if you are in the Cannabis business, to look at the tobacco business. You can bet this predatory industry is looking at Oregon’s Cannabis.

In order to approach this idea productively you have to set aside everything you believe you know about Tobacco itself, the Tobacco industry, growing Tobacco, Tobacco products, the economics of Tobacco, and the medical and scientific evidence against Tobacco (which is actually against Tobacco products – not at all the same thing, which is at the core of the industry’s con game.)

So far there doesn’t seem to have been a market anywhere in the world where $500/pound indoor-grown heirloom, perhaps even organic tobacco can be justified by a potential market. Nobody in the world is currently paying $100/Ounce retail for tobacco. That probably sounds crazy.

However, I think it’s possible that Oregon may have inadvertently reached the point where people can discover the value of $100/ounce tobacco, which is what I think real heirloom tobacco is worth, but for the moment let’s just agree that tobacco is a very valuable plant that Cannabis growers may not have considered and that the public has not yet discovered.

I believe that thousands of people are ready to discover the pleasures of heirloom tobacco smoked and vaped with their artisan cannabis, and all the circumstances that could release this unrealized demand look to me like they line up for Oregon Cannabis growers in 2019.

With many of the heirloom varieties maturing at under 70 days and some in as little as 45 days after planting out, there is plenty of time for indoor and outdoor growers to get ready, put in a small tobacco patch, and see what happens.

Background & Discussion

There are +/- 800,000 tobacco product users in Oregon, and they smoke, dip, vape and chew everything from cigarettes to blunts, from snus to chew. But for the sake of keeping it simple let’s just say that on average each tobacco product user in Oregon smokes 17 cigarettes a day, the US average, or the equivalent in some other tobacco product. At 0.8 grams of tobacco materials per cigarette (which is a whole ‘nuther story), that means that Oregon tobacco users are consuming 11,100,000 grams of what they believe is tobacco a day, over 4 Billion grams a year.

With many Oregon Cannabis growers getting slammed at only $500/pound for their flowers and their indoor production costs running around $1.25/gram, many growers are looking around for ideas, and this may be one worth considering. Even when Cannabis prices can be managed back up to more reasonable levels by opening export markets, which will provide temporary relief for some growers, the time may be right for growers to consider the potential market for heirloom Tobacco production at what I think is a sustainable grower price of $500/pound.

Heirloom Tobacco Under Lights – The Research

I really don’t know that it will be feasible to put tobacco and cannabis plants side-by-side under lights as a commercial proposition. It’s never been tried to my knowledge, and there are some questions to be answered. But, with some of the compact tobacco strains whose height and growth cycle to maturity can be coordinated with the Cannabis strains under cultivation – quite likely. It is certainly one of the first things I would try. Some kind of inter-planting might work well, especially with some of the heirloom tobacco varieties that have compact growth profiles. I have several varieties in mind that grow quickly to maturity, have relatively compact profiles, and have leaves that cure to mild but potent smoke.

But whether in its own space under lights, or in a curtained off part of an indoor Cannabis grow space – I believe that heirloom tobacco production under lights might be a very profitable junior partner in an indoor Cannabis business. There has been plenty of research and experience with conventional tobacco that can be ported over to indoor tobacco/cannabis production.

Experienced Cannabis growers will be able to immediately put the research data on every aspect of tobacco to use in growing heirloom varieties even though almost all the research is done on either the conventional tobacco types used by the industry or experimental strains that were never meant to be smoked. There are thousands of studies involving every conceivable parameter of tobacco grown in greenhouses or under lights for research.

Be careful! Sorting through all the irrelevant tobacco research that’s out there could take a lifetime, since tobacco is the white rat of plant genetics and is used extensively in plant biology research worldwide. Sorting through and applying the relevant knowledge base to small-scale heirloom tobacco production will not be a stretch, and I can be helpful. It’s important to note that since Cannabis growers love to experiment, they will find that Tobacco is at least as responsive and interesting a plant as Cannabis. Once a market for premium Oregon heirloom tobacco is established, a market for new strains of heirloom tobacco crosses won’t be far behind.

There are a number of special characteristics of tobacco that I think will make it profitable enough per square foot of indoor production space that it can work from that perspective. For example, the way tobacco is harvested, one maturing leaf at a time working from the bottom up, is in synch with the rhythms of Cannabis flower harvesting with multiple, continuous passes. Cannabis flowers and tobacco leaves receive parallel treatments in handling and drying – I see no reason why they couldn’t share the same space. Tobacco and Cannabis can, obviously, be packaged together in a lot of creative ways.

There are many other reasons why I believe that parallel indoor tobacco and cannabis production is feasible here in Oregon and maybe elsewhere.

Potential Heirloom Tobacco Markets

Under rational market conditions Cannabis production is much more profitable than anything else including Tobacco (wait for legal Coca Leaf production), but while Tobacco isn’t Cannabis in dollar value per SF, it’s up there.

More important the markets for Cannabis and Tobacco are almost exactly the same – with some important differences, but still with huge overlap. In other words, people who enjoy beautiful Cannabis flowers will love aromatic tobacco leaf, and people who are hooked on 20-40-60 commercial cigarettes a day might find that 2-3 hand-rolled (or pre-rolled) real tobacco smokes would do them just fine. Oregon Health Authority says that roughly 250,000 of the 800,000 Oregonian adults who smoke cigarettes also smoke Cannabis – I think the crossover is far greater and will exceed expectations. The same is true in every Cannabis-legal state.

The fact that high quality heirloom tobacco indoors under lights on a boutique commercial scale hasn’t been done before doesn’t mean the knowledge isn’t there – it is. Frankly there is very little that is mysterious about growing tobacco, and the finer points of each strain will reveal themselves to curious growers just as the secrets of Cannabis plants unfold for the attentive grower. There are very good reasons why Native Americans understood that Tobacco is a sacred plant, and with their respectful attitudes toward sacred traditions Oregon growers are well-suited to re-discover those qualities while building an incredible new business sector at the same time.

A good selection of heirloom tobacco seeds is, for some strange reason, readily available online, and Native American tribes have privileged access to a US government-funded tobacco germplasm collection where every strain of tobacco ever grown or discovered wild in the world is kept alive and producing a pure line of seed. In many, even most cases people will be able to access tobacco seed from the specific sacred tobacco that, for example, may have been collected 150 years ago on their ancestral land by a government botanist cataloging Native American medicinal plants.

The possibilities are really quite endless.

Sun-Grown Cannabis Flower

I’m an old-time outdoor Cannabis grower and I don’t mean to ignore the potential for a single summer crop of sun-grown heirloom tobacco as an adjunct to Cannabis for Oregon’s outdoor growers. The same environmental and cultural factors that make Oregon Cannabis such a distinctive high-value crop can work to the advantage of Oregon Cannabis growers who might start with a few heirloom tobacco plants outdoors as an experiment and see where it goes. It might take a bit of legal work or maybe not, but I don’t see any reason why an Oregon Cannabis grower who wants to grow some Aztec Rustica and then pre-roll some of their Durban Poison flower in their Aztec Rustica leaf shouldn’t go right ahead and do it.

And of course it won’t be long before somebody discovers the delights of THC & Terpene-infused heirloom tobacco leaf.

The fact that tobacco is very attractive to bugs will undoubtedly be an issue outdoors in Oregon; however, native tobacco strains are adapted to their natural environments and there are a number of NW native tobacco strains available as well as some heirloom strains from other environments that might also do well in Oregon’s short-cycle summers. There has also been a lot of work done on organic tobacco production done at NCSU that can be adapted for both indoor and outdoor purposes in Oregon.

At the core of Oregon growers’ advantage, however, is that Oregon growers are used to spending a lot of quality time with their plants, and that’s exactly what it takes to produce premium tobacco. I have studied 300 years of worldwide tobacco literature and can say without doubt that experienced hand labor is proven beyond doubt to be the path to premium tobacco. It’s really no different than wine grapes or Cannabis flowers. Technology and chemistry can go a long way in certain directions, but there will always be a market for hand-produced, highest quality, organic or responsibly grown Cannabis, Wine, Food and Tobacco.

A New Market For Trim?

Cannabis growers may find that they have a higher-value use for their trim when they blend their highest quality Cannabis trim leaf with heirloom tobacco leaf to make a very special RYO blend that can carry their own growers brand name because of its unique characteristics. With over 800 varieties of heirloom tobacco to choose from, growers will have no trouble differentiating themselves through skillful tobacco/cannabis blending of both leaf and flower.

CBD Hemp

Many different people are attracted to the exploding market for responsibly-grown CBD hemp, and growing Cannabis as hemp using very similar horticultural techniques can be very profitable as long as the market holds up. People say that CBD growers right now are getting $2500-$60,000 acre for their production depending on where they are, what strain they’re growing, how well its growing, and the selling terms and prices in their market. I’m sure that a lot of people are already warning about a flood of new production hitting the market and what that will do to prices, so Hemp growers who have learned from history are probably already looking around for complementary production possibilities.

I’ll propose that as long as a grower is getting into a couple of acres of CBD hemp as a start-up why not put in a quarter acre of an attractive heirloom tobacco strain too and see what happens if you pick it, cure it, and sell it on Amazon or at your farmers market. It’s at least as easy as Cannabis to grow, harvest and cure. Then you’ll be able to answer the important questions for yourself. Do people like it? Will they pay a good price for it? If they will, maybe you ought to think about growing some more. Not go into full-scale heirloom tobacco production, but a nice steady $20-30,000/acre (or more) on a couple of acres isn’t a bad little side-business. Maybe if a few growers are doing it then you get together as an heirloom tobacco growers co-op, buy some inexpensive, low-volume tobacco leaf processing machinery, and develop your own brand. 

Lets Do the Math

At this point, ZERO of Oregon’s 11.1 million grams a day are heirloom, exotic tobaccos grown under lights year-round and under the summer sun by experienced Oregon Cannabis growers. Maybe that’s because we haven’t actually done the math and maybe looked at things in new ways.

Here’s the math – pretty simple stuff.

40,000 SF of Tobacco = 2200+ pounds of prime leaf* per cycle @ $500/Pound = $1,100,000/per cycle x 2 cycles/year = $2,200,000/Year/Acre

*this is a conservative fact-based yield estimate; I will argue that a reasonable expectation indoors under lights is 3000 pounds of prime leaf/acre/cycle

Why $500/Pound? It’s just my opinion of what organic heirloom tobacco might sell for, and because that would work out to about $30/Ounce to the grower and with wholesale/retail margins and taxes we get to $100/Ounce or $10/8^th retail for organic heirloom Tobacco at retail. So that’s the question – will a significant number of current Cannabis and Tobacco users be willing to pay $100/ounce for heirloom organic tobacco when it is presented as a premium, Oregon-grown experience in line with ancient traditions.

One ounce of authentic, powerful heirloom tobacco won’t be smoked or vaped at nearly the frequency of contaminated, synthetic commercial tobacco products, and so for regular smokers that $100 ounce will last as long as their ounce of Cannabis and will be perceived by many as extending the life of the more costly Cannabis ounce. We can bet that a lot of people will do the math – one ounce of Cannabis at $300 and one ounce of Tobacco at $100 = two ounces of great smoke at $400 instead of $600. Sweet!

I think that the perceived value of heirloom Tobacco and Cannabis will be seen as roughly equal from the smoker’s point of view. Using tobacco and cannabis together is already well accepted and understood, and in fact is the preferred way of smoking in much of the world. What will be new for Oregon smokers, and for possible export markets in other US states as well, is the experience of smoking authentic tobacco, whether combined with Oregon Cannabis or by itself.

Oregon Cannabis and Tobacco growers would be able to make as a legitimate health claim within Oregon, directed only at Oregon smokers and vapers, that a combination of responsibly-grown heirloom tobacco with responsibly grown Cannabis is a healthier alternative to commercial tobacco. I’ve just documented the extensive pesticide contamination of commercial tobacco products being sold in Oregon, so making the relative safety argument is a slam dunk.

Commercial cigarettes aren’t actually what anyone thinks of as real tobacco, but that comes under a discussion of the marketing advantages of Oregon-grown heirloom tobacco. As for Federal regulations on tobacco; do Oregon growers care about Federal regulations on Cannabis when it comes to in-state Cannabis production and sales?

I think that the Oregon Cannabis industry ought to give serious thought to the development of a parallel heirloom tobacco industry.