Investing.com - The first licensed outdoor cannabis growing operation in Canada, which is estimated to be the biggest in the world, is preparing to go into operation this week in southern Ontario.
After receiving final approval from Health Canada earlier this month, the 100-acre cultivation site in Brant, near Hamilton, operated by 48North Cannabis (TSXV:NRTH) is expected to produce about 40,000 kilograms of dried cannabis. 48North, which is headquartered in Toronto, also has two indoor growing facilities, one in Kirkland Lake, Ont. and another in Brantford, Ont.
The company’s outdoor facility, known as Good Farm, will allow it to produce cannabis at the lowest cost per gram in the country.
“Receiving the outdoor cultivation licence from Health Canada for our Good Farm is an absolute game-changer for 48North and the cannabis industry,” said co-CEO Jeannette VanderMarel in a statement. “Overnight, the company expands its annual expected capacity from 5,000 kilograms to over 45,000 kilograms. As a result, I am confident that 48North will deliver on its promise to produce high-quality, low-cost organic cannabis for the next-generation of cannabis products and the dried flower market.”
The outdoor facility will not only drive down the cost of growing the plants compared to indoor growing facilities, it allows for the production of larger and taller crops, increasing the yield from each plant.
“They call it weed for a reason,” VanderMarel put it in a television interview.
The growing area will be tightly secured. Surrounded by fencing, the fields will also be equipped with motion sensors and about 100 cameras.
With its expanding operation now going into production, 48North will be looking to fulfill the commitment it has made after signing three recent agreements, including a contract to supply 1,200 kilograms dried cannabis from its fields to the Société québécois du cannabis, the exclusive government controlled distributor in Quebec; an agreement to supply 2,460 kilograms to the Alberta Gaming, Liquor and Cannabis Corp, the official crown corporation wholesaler in that province; and 6,000 kilograms to Humble + Fume, a leading distributor of cannabis accessories in Canada.
Shares of 48North spiked to an all-time high earlier this month on news of the approval of the outdoor growing licence, jumping to C$1.25, a 24% jump, but later dropped in the following two weeks. Today, they were trading at C$1.01, flat on the day and 2 cents above the value before the announcement of the company securing its outdoor-growing licence. Traded on the American OTC market, shares (OTC:NCNNF) in the U.S. were up 1.4%.