The late Ras Truth wrote this article for us a few years back:
So how much does it really cost to grow an eighth? In turn, how much should it cost a patient to buy an eighth of high grade medicinal cannabis? I started smoking the super kind at about age 13, Iʼm 34 now so for around 21 years I have had a pretty good hand on the pulse of the west coast high grade cannabis market. In the northwest in ʻ93 we had strains like the Oregon Purple Thai, the Snow Bud, the true G-13, NL 5 x 2, the Grape Big Bud, the U-Dub, the Death and countless others, all of these were superb super-chronic indoor grown headies, not warehouse grown commercial or from mountain bunker diesel generator 100 lighters, but small basement or attic clandestine scenes. In 1993 the price of gold ranged from $328.00 per ounce to $391.00 per ounce over the course of a year. In the northwest in 1993 the price per ounce for high grade cannabis ranged from as low as $180.00 an ounce for killer Northern Lights in Portland to as high as over $300.00 an ounce for regular good outdoor in Southern Humboldt, mind you these prices were from the grower, Iʼm sure on down the line everyone got there nickel or dime on it. An eighth generally cost somewhere between $30 and $60 averaging around $40 and an ounce was generally between $200 and $325 averaging around $250. So how much does it really cost to grow an eighth? If you figure that an illegally grown eighth of the kind from someoneʼs clandestine 6 light garden sold for $40, why is it that legally grown cannabis sells for as much as $75 an eighth in the dispensaries? Iʼve been growing indoors and outdoors off and on for the better part of the past 16 years, and as growing and breeding cannabis is my passion, I feel that I am a qualified person to help take a look at what is really going on in this budding new industry. So letʼs say you decide to set up one light, and letʼs say you donʼt know anything about growing or anyone in the business so you buy a grow guide for $40. Next you go to your local LA hydro shop and they can tell youʼre a rookie, so you get taxed. You end up spending $600 for one ballast, bulb, and hood $400 on pots, soilless mix, and nutrients and $160 on random things the guy says youʼll need such as ph test drops and the like. So now youʼve spent $1200 and are ready to get set up. You go down to your favorite club and pay $10 each for 25 clones of your favorite strain, another $250. All of your initial outlay totaling $1450. Next comes your monthly overhead, lets say you pay $4 a square foot for the space youʼre going to grow in. A 5x5 space being 25 square feet costing $100 a month. Next is the power bill, say you pay $0.25 a kilowatt hour for your power and you plan to run your lights for 18 hours a day for 3 weeks (vegetive) and 12 hours a day for 9 weeks (flowering) your total kilowatt hour consumption for one cycle will be ((18x7)x3) + ((12x7)x9) or 1134 kilowatt hours. Multiply that by $0.25 and you have a total power cost of around $250. So now add $1450 (start up) and $250 for clones and $300 for rent and another $250 for power and your grand total for your first run is somewhere in the neighborhood of $2250. Letʼs assume that youʼve got a green thumb, and your literate, and that you can bake a cake using a mix from a box. At the end of three months you will have about a pound of killer bud to smoke. Now we take $2250 (the amount of money we spent) and divide it by 454 (the number of grams in a pound) and we multiply that by 3.5 (the number of grams in an eighth) and our grand total is $17.35. Thatʼs right $17.35 an eighth. These figures are based on a one light residential scene with all the costs inflated to prove a point. What grower pays $4.00 a square foot for grow space? Our collective pays $0.55 per month per square foot in rent and around $150 per 1000 watts in flower production, in total power consumption, including cloning, pre-veg, and vegetive stages. We yield approximately 20 ounces or 500+ grams of high grade medicine per 1000 watt light every 70 days. Our expenses include rent, power, soil, nutrients, water, bulbs, and labor, and believe me, those hours add up. I estimate that the real end cost is somewhere under $100 per ounce for production of the highest grade OMRI certified organic, soil grown, indoor kush you have ever smoked. So why are the dispensaries willing to pay $4800 per pound and then sell to there patients for double what they paid? Supply and demand. I learned today that a formula used in several clubs in the LA area to set the eighth price, is to take the growerʼs price of $4800 and divide it by 454 and then multiply by 7 in this case $74 dollars per eighth ounce. This seems like an absurd way of providing care for anyone weather they are terminally ill or just stressed out insomniacs. I personally donʼt see anything compassionate about making a 100% mark up on medicine for people who need it to be well. Not to mention holding up the bar for dispensaries to pay more than three times the cost of production as an industry standard. I find that the reason for these inflated prices really comes down to a supply that doesnʼt meet the demand. With the risk of federal prosecution for medicinal cannabis on the decline, and the interest of many new legitimate investors coming into the canna-business world, it seems as though we as a community are ready for the next evolution of the California cannabis movement. Los Angles county has had somewhere in the neighborhood of 500 dispensaries, the busier of those probably see close to 200 patients a day the smallest probably as few as 20 patients a day. If the average patient buys somewhere between 1 and 14 grams per visit, and the average club sees between 50 and 100 patients per day, then the 500 or so clubs sell between 50 and 1400 grams each, or between 25,000 grams and 700,000 grams in total each day. Thatʼs right, LAʼs medical patient base consumes somewhere between 25 and 700 kilos of medicinal cannabis each day. My guess is upwards of 250 kilos (550 lbs.) of cannabis is consumed in LA county every day. My next question is, is it really all grown right in Los Angeles county? 200,750 pounds a year, grown in Los Angeles county??? By my calculations that would mean that 1,254,687.5 square feet are currently in cultivation in the county and are being harvested at a rate of 20 grams per square foot per 90 days. 50,187,500 watts of power running 12 hours a day not to mention the vegetative rooms it would take to supply clones for 50,000,000 watts of flower rooms. Some how this doesnʼt really sound like a sustainable plan, the carbon footprint from that much indoor being grown is likely to give the rest of us cancer before we manage to cure anyone. So lets look at a different model. Letʻs look toward a future where cannabis is grown in commercial agricultural environments, state wide collectives for patients of every county to join. Collectives that lease their production facilities for $0.055 per square foot and use good old fashion sunshine and relatively humble climate control systems on their green houses. Collectives that test each batch of medicine to make sure that it is free of fertilizers and pathogenic molds, and test the cannabinoid content of each crop so that known dosages can be administered. Collectives that make medicine affordable to the patients. Collectives that gainfully employ hundreds of people rather than dozens. Collectives that generate enough taxable revenue to help our stateʼs crumbling economy. Letʼs do something to make a difference in the medical cannabis evolution. Let us leave greed and paranoia by the door and work together to create an abundance of high quality medicine and use the revenue from the taxation to improve healthcare and education in our state. How much should an eighth of an ounce cost? The answer; eight bucks, plus tax. Iʼll grow the kind for eight hundred a pound! Will you?? -Ras Truth