RE:RE:RE:Glasshouse germinated? Scopro, I’m uninterested in who is long and who is short -- all that matters from an investor value standpoint is that information provided within a post be verifiable fact.
Let’s go over some of mine:
As to my claim they underestimated the costs associated with cooling a glasshouse in 115f heat, and thus underestimated the costs of construction by something like $30 million bucks … that comes from Sunniva themselves in investor conference calls (see transcripts).
As to my operational costs claim, it factually follows the above. Massive amounts of cooling equipment added after the fact require massive amounts of power to run. This equipment vacuums up money like a Hoover. If you have any doubt about this, also read in the Sunniva transcripts how SoCal Edison (local utility) was unable to immediately provide enough power to the building to run this extra equipment and it was going to cost a metric ton of money (and much time) to get the needed extra power run. This power vacuum is one of the primary reasons the project ground to a halt. (None of this has changed btw).
Now let’s look at some of yours:
// “outdoor grow or conventional greenhouse grow isn't the same quality as what could be grown in the glasshouse”//
Correct. It’s a beautiful greenhouse (I drive by it regularly as I work in the industry and have watched its construction with interest). But who’s comparing a great greenhouse to a crappy greenhouse or to outdoors? With my claim of Sunniva locating the glasshouse in the wrong place, what we’re comparing is the cost to construct and operate a great greenhouse in a mild climate to the cost of the same greenhouse in a extremely hot climate. Your statement above is a non-sequiter / red herring.
Casey Houweling, the guy who literally invented and patented this new generation of glasshouse that Sunniva purchased (Google “semi-closed greenhouse”) is a massive Canadian tomato grower. He licenced the design of the glasshouse to the big Dutch greenhouse manufacturers (Google “Kubo Ultra Clima”) and this design now dominates the new, large greenhouse construction. Sunniva made an excellent choice in this regard. When Casey wished to expand from Canada to California, did he locate his more than 200 high end glasshouse acres (10x Sunniva) in an extreme climate or inland of the central coast where he gets cool ocean breezes and still massive sunshine? You guess.
// “More cloudy in central-north california”//
Well, let’s look at that claim.
Google “Cathedral City days of sunshine per year” (271)
Google “San Ynez Valley days of sunshine per year” (287)
Do that with Buellton, Lompoc, Santa Barbara County, etc.(where the big Sunniva competitors have all located) and you’ll find that all of them provide more sunny days than CatCity.
Conversely,
Google “Cathedral City average summertime high” (108f)
Google Lompoc, etc. (74f)
Massive cooling savings.
Great sun, climate induced lower operating costs -- that's the place to economically product controlled environment cannabis.
By their own admission, Sunniva would have saved tens of millions of dollars on construction costs had they not put a glasshouse in one of the absolute hottest areas of the State (and it would have now been built and operating as they had the money to do that). They would have also saved millions per year in operating costs. All this while producing the exact same quality product.
(and don’t get me started on the near $50 million per year they would have saved in local taxes by not locating in a city with one of the highest local tax rates in the state. That’s just another reason NONE of the big boys have located there.)
Like I said … one critical mistake doomed them.
// “ lots of ways to look at pros/cons.”//
Yep -- and some of them are based in reality and some are mere justification for bad decisions.