The outdoor farm completes the company’s build-out from seed to sale and provides the opportunity to maximize margins, while still remaining competitively priced.
Agrotech planted the first 10,000 flowering seeds in April 2019, and expects the first harvest to be ready in July. Moving to clones and teens instead of seeds, the next batch will serve as biomass and material for prerolls. These materials will be sold at higher margins, as compared to material bought from an alternative farm.
The company will use these plants to provide 20,000 pounds of material, which will be used to produce products of variable quality and potency at different price ranges.
“This allows us to control the market pricing due to the fact that plant material is becoming scarcer. It is perfect timing for us to be in this space as we see prices going up for flower and other plant material,” said Casey Fenwick, president of Lifestyle Delivery Systems.
The upcoming harvest will allow CSPA Group, another LDS subsidiary, to process material for the company’s flagship product, CannaStrips, and other products like outdoor flowers, small buds, and pre-roll material.
These harvests will be enough to cover the farm’s operating costs, and if the cannabis market behaves, may even generate profit from the initial harvest alone.
The CannaStrips opportunity
CannaStrips are a THC delivery system similar to breath-strips that make it easier for THC to be ingested in the body. Some strips also include supplemental ingredients like vitamins and peptides.
CannaStrips fill a void for chronic pain sufferers.
A review of 10,000 scientific studies on the medical benefits of cannabis–published by the National Academies of Sciences, Engineering, and Medicine–concluded that patients with chronic pain were more likely to experience a clinically significant reduction in pain symptoms after being treated with cannabis.
Chronic pain is a leading cause of disability, affecting more than 25 million adults in the U.S.
Good news from Adelanto, California
In other news, late last month LDS received the nod from the Adelanto City Planning Commission to build the Highway 395 Dispensary in Adelanto, California.
The five member commission voted unanimously to submit the Highway 395 Dispensary project to city council with the commission’s recommendation to approve the project.
The council will receive the approval request on June 12, 2019, at their scheduled byweekly meeting.
Prior to that, the Adelanto City Council voted 4 to 1 to reduce the cultivation tax from $5 per month per square foot to $0.42 per month, making it easier for companies like LDS to move in and do business.
The City of Adelanto is following California’s lead in reducing business taxes to combat the influence of grey and black market products. This will make it easier for companies like LDS to operate in Adelanto.
Shares rose $.005 today and the stock price is hovering at $0.345
Lifestyle Delivery Systems has 107,494,894 shares issued and outstanding, and a market cap of $36.5 million.
Full Disclosure: Lifestyle Delivery Systems is an Equity.Guru marketing client.