48North Cannabis Corp. V.NRTH

RE:RE:RE:RE:RE:Planting

[sim_1]

I agree that they have to prove something here and that anything below 40000kg would be disappointing because that's the line they drew in the soil - mind you, I really believe they will achieve that milestone. I'd be much more worried about those other producers who came up with much higher estimates per acre. They have been conservative in their estimates and are playing it safe at all levels - that's good. I respect that a lot. 

However that extra 30000kg might never be sold and might have to be destroyed in the end. That's bad business... At the end of the day, producers will have to start producing quantities more in line with what they can sell - big writeoffs are coming for a lot of them - so what I care about most in the case of 48 is that they can produce 10000kg of high quality cannabis from the farm, because that's the committed quantity to this day. It may be necessary this summer to prove their abilities to produce much more - but it's generally bad business to overproduce something that can't be preserved indefinitely.
All my asumptions with this company are based on 10000kg. Anything below that would be catastrophic, but that's a very low bar so I'm not worried. This management team knows what their doing - don't forget that they operate two other facilities... they are no newbies...
I don't believe they can sell 40000kg this year though so to me, aside from proving their point, it's a big waste to produce that much. 
Anyway we'll know soon enough!