State marijuana industry may face growing pains

The burgeoning marijuana industry in Massachusetts continually faces challenges of every sort. The manner in which it addresses and resolves those issues will ultimately shape the landscape and result in a steady marketplace, balancing the needs of the consumer with the ability to navigate the bureaucracy and changing realities.

However, there is a challenge on the horizon that will surely test the nascent frontier.

As the Herald’s Hillary Chabot reports, it is possible that the Bay State could face a crushing cannabis shortage in the next few months that could cause prices to surge and force retailers to ration purchases.

In any retail business, a shortage of product would lead to a quick downward spiral as payroll and overhead costs would need to be met month to month. In short fashion, customers will tire of inflated prices for less product, and in the case of marijuana, return to buying on the street.

Could there be a wave of businesses that collapse during the shortage?

Sam Barber, a pioneering pot retailer and CEO of Cultivate, predicts such a development in 2019. “I think in the next few months you’re going to see some very big shortages, and as more retail locations open up, the supply just isn’t there. My guess would be middle to late summer you’re going to see some bigger growing pains,” he said. The Massachusetts Cannabis Control Commission has awarded nine retail licenses as of Wednesday, with more expected in the coming months.

Likewise, Rob Hunt, who runs a cannabis investment firm with clients in Massachusetts, sees a dire challenge: “They’re about to be walloped,” he said. “They’re trying to increase output as fast as they can, but there’s no silver bullet to make plants grow faster.”

Federal law forbids moving marijuana across state lines so any pot sold in Massachusetts must be grown in Massachusetts.

For those worried about the future availability of their daily edible, even the closure of scores of retail stores and other facilities would be merely a temporary setback. There are throngs of innovative companies waiting in the wings to replace them and a bumper crop of “seed to sale” weed is inevitable as more and more growers open up operations in the Bay State.

Whatever the future of the marijuana industry in Massachusetts, our elected leaders, however reluctant to own the issue, must be ready to grapple with the fallout.