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How legal cannabis companies keep their farms safe and secure

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As the legal cannabis industry grows, security is becoming more of a concern for the industry

As the global cannabis industry expands, those in the supply chain are facing increased risk of security threats.

The cannabis industry is growing rapidly across the globe.

As the sector expands, so does the number of grow operations, warehouses and dispensaries which all house high-value, highly regulated substances that many are willing to risk prosecution to lay their hands on.

It comes as no surprise then that cannabis companies are at a high risk of security threats such as robbery and theft.

And it’s not just the products themselves that are at risk.

In the US, as cannabis remains illegal on a federal level, many firms struggle to open business accounts with mainstream banks, meaning that dispensaries often require its customers to pay in cash. This only adds to the sector’s susceptibility to break-ins.

Unfortunately, cannabis companies must also be wary of their employees. As the black market continues to thrive in spite of legalisation efforts, dispensaries and cultivators have to keep an eye on their employees who may see an opportunity to swipe their employer’s products to sell on the illicit market.

Due to these risks, some US territories have made it mandatory for cannabis dispensaries to submit their security plans to local law enforcement for approval before being allowed to open.

Scott Thomas Genetec

Scott Thomas, national director of signature brands at Genetec

Cannabis Health sat down with security expert Scott Thomas over Zoom to find out more about the security challenges faced by the cannabis sector.

Thomas is the national director of signature brands at Genetec, a security company that has become a popular choice in North America for cannabis companies looking to keep their premises safe and secure.

Currently, in the US, 16 states have legalised cannabis for recreational use and 36 states have legalised medical cannabis. On a national level, the substance is still illegal, so regulations can differ significantly from state to state.

Thomas said: “Each one of those states is going to have very specific regulations and requirements.

“They want to make sure that the product is totally safe from seed to sale, that it is absolutely contained and that there is no potential harm or any type of additives that can be put into the crop.

“They also want to make sure that all the sales are done legally, they want to make sure that there’s proper verification of the age of the purchaser, and they want to make sure that if it’s from a medicinal standpoint, there’s an actual prescription. There are quite a few physical security requirements to guarantee that those regulations are followed.”

Thomas breaks down the security requirements into three categories; video, access control and intrusion notification.

What sets the cannabis industry apart from other regulated markets, he said, is the requirement for video retention in many US jurisdictions, some of which ask for a record of up to two years of video footage.

As any discrepancies in inventory could lead to large fines and other penalties, Thomas stressed the importance of keeping products under constant surveillance at every stage of the seed to sale process.

Thomas said: “[One of] the most fundamental requirements, and this is absolutely germane across all the jurisdictions, countries and states that we deal with is video.

“There needs to be video evidence, and this is where some of these regulations vary quite a bit.

“In some cases, they will require the entire cultivation growing area, the processing area where the product is packaged for consumption or possibly turned into other products, the retail area where it is sold and the warehousing or the storage area where it is kept.

Cannabis security

Genetec’s security systems are used by cannabis companies across the US and Canada

“All of those things need to be under observation. If there are any discrepancies in inventory they need to be able to go back and try and identify where it happened.”

If a camera is to go offline for any reason, the company is required to make the regulator aware as soon as possible and have a backup device on hand to ensure video footage continues to be captured.

“All cameras and systems have built-in ‘Genetec Health Monitoring’ inside of them. If, for example, a camera were to stop working for whatever reason, it gives them that notification.”

Access control is another key factor in keeping cannabis operations secure, Thomas continued: “This includes locked doors, credentialed employees, limiting access and the ability to audit who has the authority to enter those areas and make sure that only those people go into those restricted parts of the establishment.”

The cannabis sector is one of the fastest-growing industries in the world right now. Companies are expanding quickly and as an increasing number of territories are legalising the drug, cannabis firms are eager to expand into these new regions. But, with that comes yet another set of regulations.

Thomas uses one of Genetec’s clients, an unnamed US company that is trading publicly on the New York Stock Exchange, as an example: “What they have done is looked at the most stringent regulations they’re currently using in a given state and then mirrored that across all of their different locations.

“Their thinking is that regardless of regulations getting more stringent or eased up, they’re going to be absolutely protected across that entire enterprise; none of their sites will fail to meet that regulatory requirement.”

The firm has also centralised its security operation centre – known in the industry as a ‘sock’ – which, according to Thomas, is “unique” for companies of this type: “By doing this, they’re able to understand if there are violations of their own protocols with regards to people trying to access areas that they shouldn’t and they have our intrusion alarm integration built into that system so if there’s a break-in they’ll know.

“These are some of the unique things that we’ve built. With the Genetec platform, we’re able to put all of that into a single pane of glass. And since we are software, our product scales very easily.”

Another common problem faced by cannabis dispensaries in particular is people attempting to purchase more cannabis products than is allowed under local regulations.

Some states, for example, prevent individuals from purchasing more than a certain amount of cannabis over a given time. This means verification and identification is vital to ensure cannabis dispensaries are not enabling unlawful sales.

Genetec interfaces its video system with identification information to prevent a customer from using a fake, borrowed or stolen ID to buy more than their allowance.

Based in Montreal, Genetec became involved in the cannabis sector as the plant started to gain acceptance in Canada several years ago. The company produces software platforms to support physical security devices and since launching in 1997, it has become the largest manufacturer in the world of this type of technology.

The company now works across the North American continent, keeping cannabis grow-ops, storage facilities and dispensaries safe and secure.

Currently operating in the US and Canadian cannabis sectors, Thomas says that Genetec intends to expand into the EU market, including the UK, as the cannabis sector continues to open up.

Thomas added: “We will absolutely be at the forefront of trying to work with the folks that want to start businesses there and get them up and rolling.

“We anticipate the same security requirements would be applied in these different countries and jurisdictions as we’re seeing in the US and Canada.”

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CBD

Italy passes decree that could put CBD farmers at risk of jail

Marco Perduca of Associazione Luca Coscioni says the decree puts Italy’s entire supply chain at risk.

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Italy passes decree which could put CBD farmers at risk of jail

Italy has passed a decree that prohibits the cultivation of CBD crops without authorisation from the country’s Ministry of Health.

CBD cultivation has been legal in Italy since 2016 after a unanimous vote in parliament. However, this month the Conference of State and Regions adopted a Ministerial Decree which now prohibits the crop’s cultivation.

Farmers, which until have been allowed to grow crops containing a limit of 0.2 to 0.5 per cent THC, will only be able to cultivate hemp crops unless given authorisation from the Ministry of Health. The ruling mirrors the current law surrounding the cultivation of higher THC cannabis crops for medical purposes.

With CBD available in shops across the country, the move is one in complete contrast to the direction of the rest of Europe, bar France, which recently passed a decree banning the sale of CBD flowers to consumers.

It will also put the entirety of Italy’s CBD supply chain at risk, says president of Italy’s cannabis referendum committee ReferendumCannabis and co-founder of Associazione Luca Coscioni, Marco Perduca.

Speaking to Cannabis Wealth, Perduca commented: “This has always been in the back of the centre right’s mind.

“The Ministerial Decree which is another vehicle to make law – even if it’s more on the administrative rather than and the lawmaking level – in which they re-included plans for reducing CBD under the regular rules set by the text on all drugs.”

ReferendumCannabis is currently trying to trigger a referendum to amend the wording of this text which would enable the personal cultivation of psychotropic substances.

“This will imply for those already in the business and the newcomers, to seek a permit from the Ministry of Health, which per se will not be a problem. But why would you have to ask, or re-ask permission for a well-established enterprise, to a ministry that has nothing to do with the oils, soaps and edibles that are produced using some CBD and a very minimal percentage of THC?” 

Perduca highlights a debate is set with the president of the Agriculture Committee on the matter.

“It’s an interpretation of the law. It is not opinion-makers that make interpretations of the law – it is a judge. So, if you have the police that come to your shop, or to your house or to your farm and would like to know more on what you are producing or selling, they can confiscate everything and block your activity until further notice. 

“This is an additional burden on an already not-working system of justice. It is also a sort of CBD scare that has been launched against in particular shops and entrepreneurs – about 10,000 people that work in 3000 Small and Medium Enterprises which generate around €40m per year. 

“It’s an important part of our agricultural economy, and it’s mainly young people that invest in these kinds of enterprises.’

Together with Leonardo Fiorentini, member of  Forum Droghe, Perduca stated that the discussion of the decree took place days following the first meeting between the Ministry of Health and the country’s cannabis patient associations to discuss supply requirements. 

They stated: “The version in front of the delegates risks canceling, if not sending to jail, the entire cannabis light [CBD] sector in Italy…

“The World Health Organization has repeatedly recommended the exclusion of the properties of CBD from banned substances, some of these were collected by the UN Drugs Commission which in December 2020 canceled cannabis from the IV table of the 1961 Convention with a vote favourable of Italy. 

“To insert this submission of production to the rules of 309/90 with a Ministerial Decree, as well as going against common sense, is legally very questionable. Certainly, we need a regulation that clarifies what it can be cultivated and how to guarantee the quantity and quality of therapeutic cannabinoids necessary to guarantee the therapeutic plans of tens of thousands of people: products with a certain threshold of CBD must be treated as drugs, those below as supplements, as is already the case today for many other substances also in other EU states.

“We appeal to the competent Ministers to amend the Decree to art. 1 paragraph 4. If not, we will organize a coordinated response between patients and entrepreneurs to definitively send anti-scientific and ideological measures to the attic.” [translated from Google]

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Markets and industry

Industrial hemp in Europe driving global market growth

A new report has projected the market to exceed $310m by 2027.

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A new report has attributed the growing hemp market in Europe as a driving factor of global growth.
Home » News » How legal cannabis companies keep their farms safe and secure

A new report has attributed the growing hemp market in Europe as a driving factor of global growth.

A once under-utilised crop, hemp is now seeing strong growth thanks to the demand for alternative products. Food, drink and personal care products are driving the growth of the industrial hemp market.

A new report from Global Market Insights has highlighted government regulations and policies associated with the legalisation of cultivation, as well as escalating demand for hemp products as a main driver of the market.

 The market size was over USD$205m (~£151.09m) in 2020 and is projected in the report to reach $310m by the end of 2027.

Fibre and seeds

Hemp is utilised extensively in the pulp and paper industry as it is a considerably more sustainable crop than wood. This is due due to the fact its does not need bleaching produces more pulp per acre, offers enhanced paper strength, and utilises chemicals that are less toxic compared to wood paper. 

The report highlights that government regulations seeking to limit wood harvesting and the associated harmful consequences of wood pulp and paper production, are likely to foster product uptake. 

Read more: Italy plans hemp production increases: could the UK be next?

It speculates the segment will see robust growth to attain a valuation of more than $70.5m by 2027.

The hemp seeds segment is slated to surpass a valuation of around $74.5m by 2027 under food and beverages application, due to their wide use in supplements, such as protein powder and meal replacement bars and snacks. 

Europe

The report has attributed a proliferating industrial hemp market in Europe as well as mounting product application in automotive manufacturing as additional drivers of growth in the global market.

It notes that the Europe industrial hemp market is projected to progress at a CAGR of approximately 5.5 per cent over the forecast period to surpass a valuation of $80.5m.

Growing consumer awareness of the plant’s therapeutic effects has also boosted product demand in recent years, according to the report. 

To read the full report please visit: https://www.gminsights.com/roc/3306.

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International

Italy plans hemp production increases: could the UK be next?

Italian officials are planning an increase in hemp and processing centres which could boost fabric or fibre production

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Officials in west-central Italy are progressing plans to build a sustainable hemp supply chain model which would help to boost local agriculture.

The town of Roccasecca is located in the Frosinone province in the Lazio region. Officials are preparing the land to be planted with hemp ahead of the growing season. The project is a joint initiative of the city of Roccasecca and Cosilam, the University of Cassino and Southern Lazio, consultancy Agricola Happy Hill and municipalities of Ceccano and San Giovanni Incarico.

The project was announced last year as a way of processing poor soil and attracting industry to the region. The Consortium for the Industrial Development of Southern Lazio (Cosilam) conducted a pre-planting analysis and the soil will be assessed after one farming cycle this year.

Cannabis bioaccumlative

As well as the production of fibre, hemp plastic, concrete and biofuels, hemp can also be used as a bioaccumulative. It can draw unwanted toxic material out of the soil helping to heal polluted areas.

Nitrogen-fixing plants such as hemp, alfalfa and peas can extract nitrogen from the air for fertilization which then results in higher amounts released into the soil. Soil can be damaged by heavy metals, toxins and pesticides used in farming.

Soil regeneration may help to make the land suitable for farming other crops. Hemp could also contribute to the carbon targets set by European countries including the UK, by capturing carbon dioxide (CO2) from the atmosphere. For every tonne of hemp produced, 1.63 tonnes of CO2 is removed from the air. Hemp can absorb 15 tonnes of CO2 per hectare.

Examples of hemp fibre and fabric

Fabric made from hemp

Italian intuitive

Roccasecca is just one of many Italian cities considering hemp processing and planting.

Umbria, a neighbouring region to Lazio, has also started planting hemp with the aim of creating a hemp fibre and hurd supply chain. The city is also interested in the phytoremediation, and Phyto-purification of water in the region through hemp.

An increase in hemp farming and also an investment into infrastructure would allow Italian companies to start developing hemp-fibre-based bioplastics and biopolymers. It could also serve the textile and fashion industries where alternative fibres are in high demand.

Hemp cultivation has been legal in Italy since 2016. Until the second world war, Italy was the largest producer of hemp but the move towards synthetic fibres meant that production was scaled back.

During the pandemic, Italy proposed a law change regarding personal grows to allow medical cannabis patients to cultivate up to four plants at home. A petition on medical cannabis circulated last year gathered over 500,000 signatures which may trigger a referendum on legalisation.

Katya Kowalski, head of strategy at Volteface said: “The introduction of hemp farming across Italy is a welcome initiative. Hemp is a high value, sustainable and versatile crop. In the midst of economic and environmental turmoil, hemp is a viable crop from widespread job creation to offsetting carbon-intensive building.

Hemp is an excellent demonstration of how cannabis reform is a much broader and varied area of policy than simply recreational drug use.”

She added: “I hope that these positive changes continue to reframe the reform sector and that hemp farming is taken up further across Europe and in the UK.”

Hemp: Italy plans to increase hemp production

English production

When it comes to English hemp supply chains or production, Katya notes that changes would need to be made to THC levels to allow farmers more freedom.

“In order for the UK to capitalise on this, changes need to be made to the outdated restrictions on hemp farming. As per recommendations in Volteface’s report, Pleasant Lands allowing hemp seed varieties with a THC percentage above 0.2 per cent and up to 1 per cent would improve the health of the plant and increase the yield of CBD per acre.

Alongside this, investment into the sector and moving hemp farming under DEFRA as opposed to the Home Office to streamline this industry more”

Could the UK produce more hemp?

Hemp designer Laura Bossom, founder of Cultiva commented on what it would take for the UK to increase hemp production.

“As an industry, What we are waiting for is the government to put forward farmer incentives such as making policy changes that would allow farmers to benefit from growing hemp. Last year there were conversations happening [remove: at the moment] around building facility centres in the UK for processing. As a nation, we are only growing 1600 hectares a year and we must grow more to make it viable.” she said.

“There were initial talks about importing fibre from Europe but that doesn’t seem economically viable or sustainable in terms of emissions. I’m sure the government is aware of the information coming from research and other projects being put forward by a lot of associations. We are waiting for the government to give us the go-ahead and back it completely. They are protecting the Pharmaceutical CBD markets by making it difficult for farmers to grow. They don’t actually benefit much from growing hemp as the CBD margin on their crop is not there due to a ban on processing CBD in the UK.”

She added: “We need to be building our local industries and I don’t see why the government won’t do it. I think it’s just a matter of when.”

When it comes to private investment, Covid has caused disruption in the market and the hardiness of hemp could mean sturdier equipment is needed. However, government backing could secure private investors who may feel nervous about the sector.

Laura said: “The other issue we have is that it is quite a long process. When you look at other natural fibres, they are not as strong as hemp, so they are quicker and easier to process. Hemp is so hardy that it requires decortication with quaternized action and a lot of refining processes.

We need a facility centre that will cost a lot of money but will be profitable in the long term. It’s a big investment! A lot of investors during Covid have been wary of putting their money into a high-risk project when they aren’t seeing the government backing it or farming policy encouraging growth.”

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