Business Risks of Selling Moldy Weed

Choosing Not To Decontaminate Your Flower Puts Your Business, Your Customers, and Your State’s Cannabis Program at Risk

Operating in the cannabis industry comes with its fair share of risk. It’s federally illegal, it’s cut-throat competitive, and taxes are steep.

With these outside forces constantly working against you, cannabis risk management boils down to one strategy—running a clean, tight grow that doesn’t give your state any reason to get involved in your business.

One of the biggest reasons your state has to involve itself in your business is if you fail regulatory compliance. But it’s not the failing that’s the real red flag; that can be addressed. It’s the selling of failed, moldy weed that sounds the alarm.

Producing and selling moldy weed puts your business, your customers, and your state’s cannabis program at risk. And once the plant is rescheduled, federal eyes will be watching the industry along with the eyes of your state’s program, and selling moldy weed to consumers could come with even greater consequences.

Risks to Your Customers

Selling moldy weed puts your customers’ health at risk. It can cause issues like:

  • coughing
  • nausea and vomiting
  • congestion
  • wheezing and shortness of breath

Some factors can increase the risks of smoking moldy weed, including if the customer is allergic to mold or has a weakened immune system. In these cases, inflammation of the lungs and sinuses can also occur.[1]

In extreme cases, cannabis patients who’ve inhaled moldy weed have been hospitalized and/or have died.

Risks to your Employees

Selling moldy weed puts your customers’ health at risk. It can cause issues like:

  • coughing
  • nausea and vomiting
  • congestion
  • wheezing and shortness of breath

Some factors can increase the risks of smoking moldy weed, including if the customer is allergic to mold or has a weakened immune system. In these cases, inflammation of the lungs and sinuses can also occur.[1]

In extreme cases, cannabis patients who’ve inhaled moldy weed have been hospitalized and/or have died.

Risks to Your State's Program

All of the above risks jeopardize your state’s cannabis program. The cannabis industry as a whole is still new enough that one uncooperative business brings all others into question. If one business chooses to disregard regulatory compliance and sell moldy weed to the masses, customers, employees, and regulators alike will become suspicious of all cannabis businesses.

This suspicion can cause the state to investigate its program as a whole, but it can also cause customers and employees to take matters into their own hands. And if there’s one thing worse than regulators questioning the validity and integrity of its cannabis license holders, it’s paying customers and hard-working employees questioning the validity of the state’s program in general. Without their support, there is no program.

For example, a 2016 letter to the editor published in the Clinical Microbiology and Infection (CMI) Journal called out cannabis samples from legal operations in northern California for “numerous Gram-negative bacilli and fungal pathogens contaminating medical marijuana” which “pose a grave risk” to consumers, especially those who are immunocompromised. Two of the letter’s authors were employed at a commercial cannabis testing lab.

Likewise, the Massachusetts business currently facing a $200K fine mentioned earlier was called out by its own employees and a few of its customers.

This type of distrust within the industry is not lost on consumers or state regulators. The more eyes that are brought upon a state’s program, the more trust between customer and business is eroded, and the more the state may feel it needs to be involved.

Risks to Your Bottom Line

Consumers do not need to give any cannabis business a second chance. No matter which state you’re in, the market is saturated and there is always another brand they can try instead. If they buy an eighth of your flower only to discover it’s coated in mold, your business may experience backlash or reputation damage that could negatively impact your brand and your bottom line.

For example, recently, the Colorado Department of Revenue (DOR) and the Colorado Department of Public Health and Environment (CDPHE) issued a Health and Safety Advisory for flower sold by one particular brand. The advisory states the brand sold flower that was “...tested and found to have exceeded acceptable limits established for Total Yeast and Mold.”

According to the advisory, 12 dispensary storefronts were selling this moldy weed. While the extent of the hit this brand will take isn’t yet clear, it’s likely their operator’s distribution system is now corrupted as those storefronts will be hesitant to purchase from them again. And with word out to the industry and the public, it will be hard for them to find other distributors.

Similarly, retaining staff after employees, customers, or the state issues a health advisory like this one can be difficult and could derail this brand’s operations.

The spotlight put on a state’s cannabis program after one of its license holders pushes contaminated products can lead to greater oversight and more intense regulations, ultimately costing growers more time and money to remain compliant.

The Most Cost-Effective Strategy for Decontaminating Cannabis

Several options are available to cannabis operators looking to decontaminate their flower. Ionizing radiation technologies like gamma, E-beam, and X-ray are one option; however, these change the molecular structure of the plant, altering its chemical makeup. Additionally, all three come with extra costs—gamma and E-beam decontamination must be done offsite, and X-ray requires the purchase of extra chiller equipment if you choose to do it onsite.

Non-ionizing radiation is considered a safer option for decontaminating cannabis flower. In particular, radio frequency (RF) is a frontrunner for states and other countries currently discussing and implementing regulatory requirements. RF has been used in the agricultural sector for decades and is approved by the National Organic Program (NOP) and the USDA for organic operations as it does not alter the molecular structure of the plant.

Explore Radio Frequency Decontamination for Your Business

Ziel currently leads the industry for radio frequency decontamination with the Ziel RFX. The machine can be easily integrated into your current operation and working within one week, processing up to 160 pounds of flower in an eight-hour shift.

Using the Ziel RFX guarantees greater than a 99% pass rate for regulatory compliance, essentially eliminating all of the risks to your business discussed above.

If you’re curious to learn more about how radio frequency can improve your business and safeguard it from regulatory issues, get in touch with Ziel today.

The Hidden Implications of Cannabis Rescheduling

The FDA is Coming. Is Your Business Prepared?

In August 2023, the U.S. Department of Health and Human Services (HHS) formally recommended marijuana be rescheduled from a Schedule I controlled substance to a Schedule III controlled substance in a first move toward federal weed legalization.

In the federal government’s eyes, this would align marijuana with drugs like ketamine and testosterone, make it federally legal to get with a prescription, and define it as having “moderate to low potential for physical and psychological dependence.” As it stands in Schedule I, the plant is currently likened to heroin and viewed as having “no currently accepted medical use and a high potential for abuse.”[1]

Even more momentous than the US federal government finally acknowledging the medical validity of the cannabis plant will be the effects the potential rescheduling has on the country’s 37 legal state cannabis markets (and counting).

Although there are proponents for and against the rescheduling recommendation, one major benefit the cannabis industry has acknowledged is the elimination of the 280E Internal Revenue tax code that’s currently burdening all plant-touching businesses. Under Schedule I, plant-touching businesses can only deduct costs of goods sold from their federal taxes. Other regular business expenses, which can usually be deducted to lower taxable income, like rent, utilities, advertising, and payroll, are specifically excluded under 280E. Depreciation of capital investments, such as facilities and improvements, are also excluded.

Without the ability to deduct business expenses and depreciation, the federal tax rate for plant-touching businesses can sometimes be as high as 80 percent[2], jeopardizing the chances of financial survival.

However, even without rescheduling, several MSOs have successfully challenged the 280E regulation and have begun to receive significant refunds from the IRS for previous tax periods.  Rescheduling would codify the elimination of 280E for good, boosting the bottom line of all operators.

Relieving that tax burden is significant and necessary when considering the other changes that could come with cannabis rescheduling. For example, if the plant were to be rescheduled to Schedule III, medical marijuana goods would become subject to the same medical laws and requirements as other drugs in Schedule III like anabolic steroids and Tylenol with codeine. That means, for medical markets, there would be much greater oversight by the Food and Drug Administration (FDA). With no current FDA involvement or broad standards for the types of testing medical cannabis products must pass before being eligible to sell, regulatory laws across the country are likely to experience major changes.

One potential implication of FDA cannabis regulation could be standards around mold and yeast content, something that currently varies by state. While some states have fairly strict laws around mold and yeast counts, like Massachusetts and Louisiana, others, like Connecticut and Florida, have taken a more lenient approach. Although we don’t yet know how the FDA might change mold and yeast count regulations, businesses should be prepared for change around current state-level standards.

On that topic, the FDA’s potential involvement means eligible cannabis brands may finally be able to claim USDA Organic status under the National Organic Program (NOP). However, it’s important for brands to recognize that, as it currently stands, food products treated with ionizing radiation to reduce yeast and mold counts are ineligible to be USDA Organic by NOP and FDA standards. It’s fair to assume cannabis products treated with ionizing radiation, such as X-ray, will also be ineligible for USDA Organic status, especially medical products.

Instead, the FDA could implement the USDA’s current rule for food products treated with ionizing radiation and require cannabis products treated with that technology to be labeled with the Radura, the international symbol that signifies a product has been irradiated. This label update could have a negative impact on a brand’s consumer trust and loyalty.

Time will tell whether the US federal government decides to reschedule marijuana as a Schedule III substance, but one thing that’s for certain is change at the federal level is coming, and cultivators need to have a plan in place for whenever federal oversight begins. For those concerned about passing regulatory compliance for mold and yeast content but not willing to compromise their product with ionizing radiation, non-ionizing radiation like Radio Frequency could be the answer.

Radio Frequency is already used to remediate foods like nuts and seeds, which are all regulated by the USDA and FDA. The technology is approved for USDA Organic operations as it has no impact on a product’s molecular structure. It simply uses long radio wavelengths to create an oscillating electromagnetic field around and within the product, causing moisture molecules to sync with the vibration and rotate in unison with it. The friction this generates creates enough heat to kill microbial pathogens without getting too hot to degrade or decarb THC, maintaining the chemical integrity of the plant.

Ziel is the cannabis industry’s leader in Radio Frequency remediation, having been granted the first-ever U.S. Patent for processes that include the treatment of cannabis with Radio Frequency in 2020. To learn more about what Ziel can do for your operation in preparation of federal change, contact us today.

Germany Reschedules Cannabis, Uncaps Domestic Production and Opens Social Clubs Across Country

Updated: May 2024

Germany’s first chapter of its journey to an adult-use market premiered on April 1, 2024.

In line with the country’s initial announcement of an adult-use market back in April of 2023, this “first pillar” of legislation includes removing cannabis from the country’s Narcotics List and scheduling it as any other prescription drug. This move makes it easier for patients to access plant medicine by eliminating cumbersome supply chain restrictions and reducing the stigma medical doctors may feel toward the plant. It also makes it easier for researchers to learn more about the plant, uncaps domestic production, and in a nod to adult use, allows the establishment of cannabis social clubs.

The country’s cannabis club structure is similar to Spain’s, requiring members to pay a membership fee in exchange for access to the plant and allowing adult-use consumption on-site. The clubs are state-controlled and not-for-profit. They start operating on July 1, 2024.

Additionally, as of April 1, individuals can now grow up to three plants on their premises.

Lawmakers are now working on the “second pillar” of cannabis legislation which is expected to eventually authorize a limited number of dispensaries in certain cities for a five-year trial period. During that time, officials and regulators will study the impact of these shops on the country’s consumption habits and black market activity before determining the next step in nationwide cannabis legalization.

Germany’s Future Cannabis Supply

Starting April 1, domestic production of cannabis in Germany is legal for anyone to partake.

For the last seven years, domestic cannabis cultivation for the country’s medical market has been limited to three federally approved suppliers. Because of this production cap, a supply gap of as much as 80% has been filled with imports primarily from Canada, Portugal, and the Netherlands.

Scaling domestic production to support this new market is expected to take years. In the meantime, the adult-use market is projected to increase product demand 7-10X, creating further reliance on imports. This demand will continue to be filled by imports from the Netherlands, Canada, and Portugal, emerging players in Macedonia, Malta, and Czech, as well as low-cost suppliers from Colombia.In keeping with its intention of building a pharmaceutical-grade system in the EU and the United Kingdom, all cannabis flower in Germany, whether imported or grown domestically, is required to be grown in GACP-validated facilities and processed post-harvest in GMP-validated facilities.

Germany Cannabis Exporting/Importing Requirements

Operators exporting cannabis flower to Germany, as well as domestic producers, have principally relied on ionizing radiation technologies like X-ray, gamma, or e-beam to meet the strict microbial compliance regulations detailed in the European Pharmacopoeia, which currently governs the EU cannabis regulatory framework. Not only are these treatments expensive, but they alter the molecular structure of the plant, creating free radicals and potentially unknown medical consequences.

Germany has taken a strong stance against both domestic and imported cannabis flower that has been treated with ionizing radiation. Producers that do use ionizing radiation are required to secure an AMRadV license for each strain treated with ionizing radiation. This license can take up to 12 months to receive and costs €4,500 per strain.

Separate from this license, the country also requires all exporters and domestic producers to follow EU GACP (Good Agricultural and Collecting Practice) and EU GMP (Good Manufacturing Practice) guidelines.

RFX Radio Frequency Microbial Treatment

Choosing non-ionizing technology like Radio Frequency (RF) to achieve microbial compliance is the most cost-effective solution for those looking to export cannabis to Germany. Radio Frequency is a non-ionizing radiation technology that ensures cannabis flower meets microbial compliance, doesn’t change the molecular structure of the plant, and therefore does not require AMRadV certification. Ziel’s RF technology has achieved EU GMP validation as a microbial control solution for cannabis flower and operating commercially in Europe. As a post-harvest treatment, RF can seamlessly integrate into EU GMP-certified operations. 

Ziel’s RFX machine has the largest throughput of any microbial control solution on the market today, making it ideal for cultivators looking to process large volumes. Using Ziel’s Business Case Calculator, cultivators can determine how much revenue the RFX will recover for their business by increasing harvest yields, avoiding compliance failure, and eliminating the need to send contaminated product off to extraction. This, in turn, also eliminates the subsequent costs for retesting. Cultivators interested in exporting to Germany are also encouraged to add up how much they’d spend in time and money on AMRadV licenses for each of their strains treated with ionizing radiation, an expense that’s nonexistent with Ziel’s RF technology.

To better understand just how much money the RFX can save a cultivation, explore the example below. Using a wholesale selling price of €4,000/kg, if a processor failed 20% of their annual harvest, they would be forced to retest, treat again, or offload the failed product to a manufacturer for a deep discount—as much as 90%, or €400. This snapshot shows the revenue a cultivator will recover within the first year of using the RFX, based on recovering 20% of the harvest that fails microbial testing on 1,000 kgs of dry flower harvested per annum.

In this example, more than €720,000 of revenue is recovered in the first year alone—more than double the cost of the RFX!

The Future of Germany’s Cannabis Market

As Germany spends the next five years monitoring its new adult-use market and the limited number of dispensaries it’s anticipated to license, microbial compliance regulations are expected to become clarified with the release of a German monograph designed specifically to address cannabis.

Cannabis cultivators looking to join Germany’s market must have a mold treatment solution in place. Radio Frequency is the safest and most cost-effective option on the market, requiring no additional licensing and operating in alignment with EU GMP processing guidelines.If you’re looking to streamline your product’s entry and position in the German cannabis market, let’s talk. Ziel’s RFX offers the largest throughput of any technology currently available and boasts a >99% pass rate for regulatory compliance. Together, we can get you set up to leverage what’s anticipated to be one of the largest cannabis markets in the world. Get in touch with Ziel today.

Types of Microbial Control Solutions for Cannabis

What They Are, How They Work, and the Best Option for Your Operation

Making cannabis a Schedule III drug will allow the Food and Drug Administration (FDA) eyes into cannabis operations for the first time. They’re expected to implement strict manufacturing standards that parallel those currently required for other agricultural and pharmaceutical sectors. 

One of those manufacturing standards will be remediation requirements for microbial contamination. Operators without a kill step in their SOPs will need to add one to ensure compliance with the new federal regulations.

There are several remediation technologies to be considered, each with its own pros and cons. Keep reading for a breakdown of each to determine which is the best choice for your operation.

Ionizing Radiation Technologies

Ionizing radiation reduces microbial contamination by irradiating the product. While these are popular technologies that many producers in agriculture use, they’re not always considered safe as they alter the molecular structure of whatever they’re irradiating. In cannabis, irradiation has been shown to alter terpene and moisture content[1], and in some cases, it’s also altered the anti-proliferative compounds of the plant[2] i.e. those that may fight against certain cancer cells.

In certain countries, like Canada for example, any product treated with ionizing radiation must be labeled with the Radura, the international symbol for irradiation. In the US, the FDA requires whole foods that have been irradiated to be labeled with the Radura. This requirement may extend to US cannabis once the reschedule is in effect. US states like Nevada have also been considering the same requirement for cannabis.

Gamma Radiation

Gamma radiation has been used in agriculture for decades, particularly with meats, fruits, and vegetables. It’s also a well-established method used for sterilizing medical supplies. This technique employs high-energy photons to penetrate deep into materials, disrupting the DNA of mold, bacteria, and other pathogens to render them inactive. However, some evidence shows that this disruption leaves enough DNA intact for those microbes and pathogens to revive themselves.

Using gamma radiation in cannabis can be expensive as the process must be done entirely off-site, costing operators time and money.

Electron Beam (E-beam) Radiation

Like gamma radiation, E-beam radiation utilizes high-energy particles to eradicate microbial contamination. The primary difference lies in the particle type; E-beam uses electrons instead of photons. This method is known for its rapid processing times, but it doesn’t penetrate the flower as deeply as other remediation solutions, so there’s no guarantee it eliminates pathogens within the core of the bud. This can be an issue when dealing with pathogens like Botrytis, AKA “bud rot,” because it typically starts on the stem at the bud’s core.

Treating microbial contamination in cannabis with E-beam must also be done offsite, so it comes with similar added costs as gamma radiation.

X-ray Radiation

X-ray radiation falls between gamma and E-beam in terms of penetration depth and energy. This modality is advantageous for its ability to uniformly treat cannabis products whether or not they’re packaged, but it still doesn’t guarantee the core of the flower has been treated.

Operators can install their own X-ray remediation equipment on site, but additional chiller equipment is needed so there are added costs associated with this option.

Non-Ionizing Radiation Technologies

Non-ionizing radiation is considered safer than ionizing technologies because it does not alter molecular structures.

Radio Frequency

Radio Frequency (RF) treatment is a non-ionizing radiation technology that uses long, low-energy wavelengths to penetrate the cannabis flower to its core. These wavelengths create an oscillating electromagnetic field around and within the flower that generates heat, effectively destroying microbial contaminants without destroying the chemical makeup and potency of the plant.

RF treatment is particularly suitable for organic cannabis operations. Although cannabis cannot be officially designated as organic at this point, the reschedule will make this label available to cannabis operations. The USDA has already recognized RF treatment as an organic solution for other agricultural markets.

Ziel’s RFX machine has also been validated for EU GMP operations and can easily be integrated into operations looking to export cannabis to the EU. Ziel can install the RFX on-site, so you don’t have to worry about additional transportation or administration costs.

Cold Plasma

Though cold plasma radiation is non-ionizing, it’s not considered to be as safe as RF because it generates free radicals which may create health risks for consumers.

Basically, a high-voltage electrical charge is initiated within a gas. This charge then creates a cloud of electrons, ions, photons, and free radicals that poke holes in the membranes of pathogens and damage their DNA. Like E-beam radiation, it is mostly a surface-level treatment, so there is a risk that microbial contamination within the core of the flower won’t be treated.

UV-C Light

Ultraviolet-C (UV-C) light remediation uses a spectrum of non-visible, short-wavelength light to disrupt the DNA of pathogens. It attacks the core of a pathogen and prevents it from replicating. Because its wavelengths are short, it treats mostly the surface of cannabis flower and doesn’t tend to penetrate the flower’s center.

UV-C remediation can be used to treat loose flowers or fully packaged products. Additionally, because it’s chemical-free and non-ionizing, it can be incorporated into organic food operations and will likely be allowable for organic cannabis operations as well, once the USDA opens that designation to cannabis.

Chemical Remediation Technologies

There are a few chemical remediation technologies available, including ethanol, CO2, and ozone. We’re only going to touch on ozone here as it’s the most common chemical option for cannabis operators.

Ozone

Ozone treatment leverages the strong oxidizing properties of ozone gas to eliminate microbial contaminants. It can be incorporated into organic cannabis operations and has a GRAS (Generally Recognized as Safe) designation with the FDA, but it does have the potential to leave residue behind on your cannabis products.

Ozone remediation treatment can vary depending on the machine you use. Many ozone generators do not allow you to control the concentration of ozone, and too much of it can be extremely damaging to cannabis flowers. Even with a more customizable machine, it is mainly a surface-level treatment that doesn’t guarantee the core of the flower has been decontaminated.

Choosing the Right Microbial Control Solution for Your Operation

As the FDA prepares to regulate cannabis operations following its federal rescheduling, incorporating effective microbial control solutions into your SOPs is going to be essential for compliance and product safety. Understanding the various microbial remediation technologies available to you is crucial for making the right decision for your operation’s future.

Among these remediation solutions, Radio Frequency stands out as the best choice for cannabis operators. RF treatment offers an organic, non-ionizing, and cost-effective method of microbial control without compromising the quality and integrity of your product.

In particular, Ziel’s RFX can set your business up for a successful future as an organic, GMP-validated operation ready to sell in the US or export across the globe. Get in touch with us today to find out more about incorporating radio frequency remediation into your business.

EU GMP Certification Valuable Asset for Cannabis Operators Looking to Export

Regulatory compliance and quality assurance are paramount for operators seeking to establish themselves in the cannabis industry. In the United States, for example, each state with a medical or recreational program has its own standards around pesticides, mold content, and other compliance factors. In Europe, a more comprehensive approach to regulatory compliance that mirrors the pharmaceutical market has been implemented.

Although the discussion around recreational cannabis in Europe is still progressing, strict regulations already govern production and distribution across the continent. With this, the European Union Good Manufacturing Practice (EU GMP) Certification has emerged as a crucial asset for cannabis operators, especially those looking to export cannabis to Europe’s medical cannabis markets.

What Is EU GMP Certification?

EU GMP Certification establishes the minimum standard that all European medical manufacturers—including cannabis cultivators and manufacturers—must meet to legally distribute their products under the European Medicines Agency (EMA). This means any domestic cannabis operators in the EU and any companies outside the EU seeking to export to the EU must be EU GMP Certified.

Specific regulations can vary depending on the product type and intended use, but essentially, the certification considers factors such as:

  • Premises and equipment
  • Documentation and records
  • Storage and distribution
  • Complaints and product recall
  • Production controls
  • Quality control
  • Audits and inspections

Germany, the largest importer of cannabis in the EU (30 tons in 2023), has taken it one step further, requiring an AMRadV license for all strains decontaminated with ionizing radiation (X-ray, gamma, and e-beam). This license can take around 12 months to secure and cost around €4,500 per strain.

Current Legal Cannabis Markets in Europe

Over 20 EU nations have proposed some sort of medical cannabis legislation, with a few also laying groundwork for an adult-use market.[1] At this point, you won't find recreational markets like Canada's or the United States’, though adult-use cannabis is still available in certain countries with specific program measures in place, and in other EU countries, patients can secure cannabis for adult use with a prescription.

  • Spain: Cannabis is decriminalized and personal consumption and private cultivation are legal in Spain; however, selling cannabis is illegal. “Social clubs” numbering more than 1,000 nationwide operate in a legal gray area.
  • Netherlands: While recreational cannabis is technically illegal in The Netherlands, the sale and possession of small quantities are tolerated in licensed "coffee shops" under a policy of "de facto" legalization.
  • Luxembourg: Last year, Luxembourg legalized the possession, consumption, and cultivation of up to three grams of cannabis, though public purchasing is still not allowed.
  • Malta: In 2021, Malta became the first EU country to legalize cannabis for adult use using non-profit cooperatives instead of dispensaries.
  • France: A three-year pilot medical program is now halfway complete. However, the government recently announced it’s discontinuing the use of cannabis flower in the program.

Germany is leading the way on proposed legislation changes that are expected to have a ripple effect across the EU and the globe. With the potential for their market to grow 7-10X in the next 18 months, the country’s AMRadV license requirement has cultivators with plans to export to Germany reconsidering their post-harvest decontamination technology choices.

Radio Frequency Decontamination Approved for EU GMP Facilities

For cannabis operators looking to earn or maintain their EU GMP Certification but in need of an effective mold remediation solution that won’t require AMRadV licensing, Radio Frequency (RF) solves both these needs.

RF decontamination is already used for food safety in established agricultural markets like nuts and dates. It’s recognized by the U.S. Department of Agriculture (USDA) as an organic process. And, as of January 2024, Ziel’s RF technology has officially received its EU GMP Certification for microbial control.

This certification allows cultivators wanting to export, or currently exporting, to Germany to avoid AMRadV costs while still maintaining their EU GMP status.

Incorporate RF Decontamination into Your EU GMP Operation

Curious to learn more about RF microbial decontamination and how it can earn you more money without compromising your EU GMP Certification? We’ll walk you through the power of Radio Frequency and what it means to treat your flower organically, without the side effects of ionizing radiation. Get in touch with us today.

Ziel Now Offering Financing and Leasing Options for Cannabis Cultivators

Change moves slowly at the federal level, especially if cannabis is involved. Since the first recreational market opened in 2012, not much has been done for the industry or its financial situation, although some recent efforts have been made. For example, the U.S. House of Representatives passed the SAFE Banking Act seven times since 2019. The Senate Banking Committee passed its SAFER Banking Act in September 2023. Even the Department of Health and Human Services (HHS) recommended cannabis be rescheduled to Schedule III in August of 2023. Yet, cannabis cultivators are still struggling to find financial backing and continue to carry the weight of 280E, hurting cash flow.

To address this situation and help cannabis cultivators boost their bottom line with minimal upfront cash outlay, Ziel is pleased to announce partnerships with multiple financial institutions that have an established presence in the cannabis industry. Zie identified these direct lenders to provide our customers with a cost-effective means to finance or lease the safest cannabis remediation technology on the market—the Ziel RFX.

Using Radio Frequency (RF), the Ziel RFX decontaminates whole flower and trim to deliver a greater than 99% regulatory compliance pass rate. On average, the Ziel RFX recovers $1.1 million annually for each of its clients.

Read on to see how much revenue the Ziel RFX can recover for you and how you can secure yours with the help of our financial partners.

Financing Ziel RFX

Financing your Ziel RFX allows you to own your machine on day one. Along with your machine, you’ll get our Service Plan free for a year which includes:

  • Bumper-to-bumper warranty
  • Online Dashboard that provides access to all your COA data and processing parameters
  • Consults with our engineers and scientists to optimize your post-harvest operations

You have the option to extend both the Service Plan and warranty once your financing term is completed.

We will facilitate the financing with our partners for no extra charge. Learn more about what’s needed to finance your Ziel RFX here.

Leasing Ziel RFX

Leasing your Ziel RFX allows you all the benefits of owning a machine but with the flexibility to walk away at the end of your lease term. Additionally, leasing offers the advantage of conserving your cash upfront. The out-of-pocket spend on day one of leasing your Ziel RFX is a little more than 5% of the out-of-pocket spend that comes with purchasing the machine outright.

Our partners offer lease terms as short as two years and as long as five years, giving you the flexibility to set terms that work with your business goals and projections. If you do decide you want to continue using RF as your preferred microbial control solution, you have the option to purchase your Ziel RFX for $1.00 at the end of your lease term.

With your lease, you’ll also get our Service Plan included for the duration of the entire lease, so you can operate your business with confidence. Similar to our financing option, we’re happy to negotiate your lease terms for you at no extra cost. Click here to read more about what’s needed to lease the Ziel RFX.

Buying Ziel RFX

There is always the option to buy your Ziel RFX outright. Like our financing and leasing options, a one-year bundled Service Plan is included in the purchase price.

Purchasing your machine allows you to immediately incorporate it into your standard operating procedures (SOPs), plus you become eligible to be one of our Authorized Tolling Partners and provide microbial reduction services to smaller and mid-size operators in your area.

Which Option Is Best For Your Cannabis Business?

To help you determine the best payment terms for your situation, we’re also excited to announce the release of our updated Business Case Calculator that incorporates leasing and financing options. Use it to quickly and easily determine if you have a worthy business case to justify moving forward with an investment in the Ziel RFX.

Using our Business Case Calculator, you can input and adjust your:

  • Current harvest volume per year
  • Percentage of harvest that fails microbial testing
  • Wholesale pricing for dried flower and trim

From there, you can select your inputs (interest rate, down payment, and term) to evaluate what your monthly out-of-pocket payment will be for either leasing or financing.

Financial Advantages of Working With Ziel

Apart from our financing and leasing options for cannabis cultivators, and the average $1.1 million each of our customers recovers in lost revenue each year, there is another potential bottom-line benefit to the Ziel RFX. You may be able to depreciate your machine each year to reduce your taxable income.

This will require review with your accountant and financial advisors, but with the Ziel RFX as a part of your SOPs, you may have the option to claim its depreciation under your costs of goods sold (COGs). This could reduce the amount of taxes your business must pay under 280E.

Get Started with Ziel RFX

Explore our Business Case Calculator to determine your optimum financial solution. If you have questions or are curious about how to get started with your financial application for the Ziel RFX, get in touch with us today. We’re happy to help you narrow down the right financing or leasing option for your operation.

MJBizDaily’s Take on Irradiation

U.S. Consumers and Growers Remain Concerned About Cannabis Treated With Ionizing Radiation

“Cannabis irradiation poses quandary for growers, scares consumers” by David Hodes of MJBizDaily explores the reasons why some cannabis cultivators feel forced to irradiate their flower despite the potential harm it could cause their product and their customer base. Hodes talks with laboratories in the U.S., as well as European cultivators, to learn why consumers remain wary of cannabis treated with ionizing radiation and what U.S. regulators can learn from the microbial guidelines of established cannabis markets.

Why Radio Frequency Is a Superior Solution to Ionizing Radiation for Both Cannabis Regulators and Consumers

Similar to other agricultural commodities, cannabis must pass regulatory compliance testing for microbial pathogens before it can be legally sold to consumers. Currently, cannabis cultivators have a few options to treat their flower, the most common being: ionizing radiation technology like gamma, X-ray, and e-beam or non-ionizing radiation such as radio frequency.

Although the legal cannabis industry is new across the globe, a trend in cannabis decontamination tech is already emerging. While both ionizing and non-ionizing tech are equally successful in reducing mold and pathogens, the similarity ends when evaluating the impact on the original product quality. So much so that regulators in Canada and Germany have implemented extra rules for product treated with ionizing radiation to warn consumers of its usage, and states in the United States are discussing the same.

Cultivators have also taken note of the current regulations and ongoing conversations around cannabis decontamination. Seeing the writing on the wall, forward-thinking operators are future-proofing their business and electing non-ionizing solutions for their post-harvest operations.

Ionizing vs. Non-Ionizing Radiation

The difference between ionizing and non-ionizing radiation goes down to the molecular level..

Ionizing radiation such as gamma, X-ray, and e-beam use high energy wavelengths to penetrate cannabis flower, simultaneously killing mold and pathogen DNA while removing electrons from the atoms and molecules of the flower. This molecular change of electrons essentially nullifies the natural integrity of the flower, eliminating the enzymatic properties of the plant that are responsible for its unique characteristics.

Non-ionizing radiation such as Radio Frequency uses longer, lower energy wavelengths to penetrate the cannabis flower. These wavelengths create an oscillating electromagnetic field around and within the flower, causing its moisture molecules to vibrate in unison with it. This rapid oscillation creates just enough thermal heat to kill mold and pathogens without harming the flower’s molecular structure or chemical or enzymatic content.

This distinction is why regulators remain concerned about cannabis flower treated with ionizing radiation. While states in the US can currently make their own determinations about cannabis decontamination requirements, bellwether countries such as Germany are making decisions on a grander scale. Regulations enacted in Germany are influencing policy regulators in the emerging EU market and having ripple effects in more established markets like Canada.

Current Regulations Against Ionizing Radiation

Germany’s medical marijuana program was launched in 2017 and its recreational program in 2023. Despite both programs being limited, the country still has to import the majority of the cannabis it sells from Canada, the Netherlands, Australia, Portugal, Macedonia and Malta because of domestic production caps on the three licensed cannabis producers in Germany. To help protect their consumers from imported cannabis that’s been treated with ionizing radiation, the country has implemented AMradV regulations. These rules require cultivators to obtain a license for each strain treated with ionizing radiation, costing € 4,500 and around 12 months in processing time per registration.

Likewise, in Canada, cultivators using ionizing decontamination to clean their cannabis must label each product with the Radura, the international symbol that indicates a product has been irradiated.[1] Recent trends show Canadian consumers starting to steer clear of cannabis labeled with the Radura because, by Canadian law, if cannabis has been treated with ionizing radiation, it cannot be considered or labeled as organic.

In the United States, cannabis regulators in Nevada have been in discussion for two years about whether or not to label cannabis products that have been treated with ionizing radiation with the Radura symbol. They’re considering the USDA’s current guidelines on labeling food treated with ionizing radiation, which requires the Radura symbol, though a final decision has yet to be made.

Since the cannabis plant remains federally illegal in the United States, cultivators currently can’t qualify as organic operations like Canadian cultivators can. But once the plant is legalized at the federal level, and if the FDA sticks with the same guidelines the USDA and National Organic Program (NOP)currently have for food products treated with ionizing radiation, any cultivator using ionizing radiation will be ineligible for organic status and will have to label their products with the Radura symbol.

Essentially, across the globe, ionizing cannabis remediation costs the cultivator more money in labeling, licensing, and consumer satisfaction.

Other Costs of Ionizing Radiation

Ionizing cannabis remediation has other associated costs outside of regulations. For example, e-beam and gamma remediation must be done off-site, costing cultivators time and money for transportation, insurance, and administration.

X-ray equipment can be installed on-site, though it does require the installation of additional chiller equipment, adding cost and an additional layer of initial permitting and annual renewals.

Radio Frequency remediation, on the other hand, doesn’t call for any extra licensing, labeling, or facility upgrades. It can be done on-site, and the technology has already been screened by the USDA in other applications—a strong proxy for when the feds inherits the cannabis portfolio.

Ziel Leads the Way for Radio Frequency Remediation

Ziel is the global market leader in non-ionizing radiation treatment with Radio Frequency. Our RFX is easily integrated into an existing operation, requiring zero facility changes. Unlike X-ray equipment, which must be cooled, the RFX can run 24/7, processing 1-6 pounds of cannabis every 14 minutes.

Cultivators who choose Ziel’s Radio Frequency remediation technology have the ability to monitor every batch treated so they can dial in specific treatment recipes for each of their strains. The RFX compliance pass rate is >99%, saving cultivators an average of $1.1 million each year in lost revenue.

ROI snapshot

*CAPEX - Capital Expenditure *OPEX - Operational Expenditure 

Leverage Radio Frequency in Your Operation

As countries around the world continue to dive into the cannabis industry, regulators are prioritizing cannabis remediation laws to protect their consumers. Those cultivators that choose to meet regulatory requirements via ionizing radiation are quickly learning that the associated costs aren’t worth the risk.

Radio Frequency is the safest and most cost-effective cannabis remediation option for cultivators and consumers. Contact Ziel today to learn how to incorporate the Radio Frequency solution into your SOPs, increase your yields, and future-proof your business.

Germany Cannabis Exporting/Importing Requirements

Germany Set To Replace Canada as Largest Legal Cannabis Market in the World

In April 2023, after talks with EU lawmakers, Germany announced its plans for cannabis legalization. Though these plans are not as accelerated as many hoped, they pave a clear pathway for Germany to replace Canada as the largest legal cannabis market in the world within the next decade.

Included in this first round of recreational legislation are state-controlled, non-profit social clubs that can cultivate and sell cannabis to a limit of 500 members, similar to Spain’s current adult-use structure. Individuals are also allowed to grow up to three plants of their own.Germany also included plans to authorize a limited number of dispensaries in certain cities for the next five years. During that time, officials and regulators will study the impact of these shops on the country’s consumption habits and black market activity before determining the next step in nationwide cannabis legalization.

Cannabis Learning Center

Featured in "Processing" in the Cannabis Learning Center

The Cannabis Learning Center, is a free educational platform provided by NJ Cannabis Consulting that fosters the development of the cannabis industry. Ziel has created educational videos and microbiology overviews that help users understand the risks of microbes and pathogens in cannabis, and how to safely remediate them using Radio Frequency. View our learning hub in the link below.