Making cannabis edibles used to be easy. All you needed was a home kitchen, some marijuana, some recipes and some moxie. But under California’s new legalization law Proposition 64, and the Medicinal and Adult Use Cannabis Regulation and Safety Act (MAUCRSA) — things are much more complicated.
To make a personal cannabis edible, you need to: be 21 years of age or older; extract cannabis resin; infuse it into butter or oil; use the canna-butter to create infused food or drinks.
But making commercial edibles requires first obtaining both local and state edibles licenses. About 65 percent of California cities and counties have banned commercial cannabis kitchens. Those that allow local licenses have zoned the activity into just one percent of available commercial spaces — making rents prohibitive. Assuming you can find a city and a place to rent, you need those local and state licenses. There’s three license types to chose from.
Type N – Infusion License
The easiest and cheapest one, a “Type N” license, allows you to add cannabis oil to food. Type N “infusion” licenses are the best way to see how many smaller edibles businesses are surviving in legalization’s new rules. As of the date of this writing, the state has issued temporary Type N licenses to 28 corporate entities.
Type 6 or Type 7 – Extraction Licenses
Two other, more expensive, “manufacturing” licenses cover both the resin extraction process and the infusion of cannabis extract into butter or oil. Annual license fees for these “Type 6” and “Type 7” licenses range from $2,000 to $75,000 based on the business’ revenue. The number of Type 6 and Type 7 licensees are more numerous: 283 entities have a Type 6 or 7 license in California.
Many of these Type 6 and 7 license holders will create edibles for any brand that pays for them (white labeling), along with making other extracts destined for products like cannabis e-cigarettes (called vape pens), or just pure hash for smoking.
Like other industries, a few efficient cannabis factories with deep reserves could end up producing the majority of edibles in California. The appearance of diversity on store shelves will hide what amounts a world dominated by the equivalent of Costco’s Kirkland brand of edibles.
That is, unless far more cities create and issue Type N licenses as well as allow for shared commercial cannabis kitchen spaces.