Investors in Cannabis ‘Mega-Factory’ Near LA Banking on Federal Legalization

Production of edible hemp
An employee of 4Front, a large cannabis factory for cultivation and production, sorts edibles. REUTERS / Shannon Stapleton

The company behind a large cannabis plant in California hopes the federal legalization of the substance will allow it to expand the distribution of joints, oils and edible products across the borders of the most populous US state.

California legalized recreational cannabis in 2016, but remains on the federal list of controlled substances.

The U.S. House of Representatives passed a bill April 1 to end the federal marijuana ban, although the measure is unlikely to pass the Senate.

Joshua Krane, Vice President of Cannabis Operation 4 Frontsaid the company’s 170,000-square-foot production and processing facility in the city of Commerce near Los Angeles has the capacity to supply the west coast of the United States with cannabis products if restrictions are lifted.

“This facility was designed to be really unexpected for us in terms of being able to serve not only the entire California market, but just being able to transport cannabis and sell cannabis across the state, so we can “We really feed the West Coast of the country,” he said.

The plant, which opened in November 2021, operates at 20-25% of capacity, Krane said.

“As we see the natural growth of the industry, this is likely to meet an additional demand curve as we enter federal legitimacy,” he added. “And so we will continue to increase more and more production from this building as required by the state and we hope that this side of the country.”

Krane said the highly automated facility is the largest in California. Manufactures both domestic and partner brands, including oils, tinctures and several types of candies.

Edible items are the most popular and demand has increased since the coronavirus pandemic began in 2020, Krane said.

“It was a bit difficult to keep up with the extra production demand enough for these new customers. “There has been a huge shift from alcohol and other evils to cannabis.”

In March 2020, as lockdowns took effect, recreational cannabis sales in major US markets increased by almost 50% over a year earlier, according to cannabis outlets and the Flowhub data platform.

With a machine that can roll 2,000 joints per hour and a kitchen capable of producing 400,000 pieces of candy in a single shift, the factory is ready to continue the demand.

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