Wildfires across the West Coast of the United States have claimed the lives of at least 35 people and destroyed more than 6,000 homes, while burning nearly 6 million acres. Damages are estimated to be between $130 and $150 billion, at a time when the nation is already reeling from the health crisis and economic fallout of the coronavirus pandemic.
Cannabis businesses, particularly those in Northern California and Southern Oregon, have suffered untold damages, with many being evacuated or suffering lost revenue related to smoke and others being destroyed altogether. Damages will be felt in every segment of the supply chain, from cultivation to processing to retail.
The most recent reports from the Oregon Liquor Control Commission show that at least 12 of the state’s cannabis businesses were completely lost to the fires. According to a spokeswoman for the California Department of Food and Agriculture, 39 cannabis cultivation licensees have inquired about “license-fee-relief measures” as a result of fire-related evacuations but none have disclosed the amount of damages from the wildfires.
While many cannabis business owners are working to recover from the massive fires that spread along the West Coast, Gregg Kerr is starting over from square one. The forceful, low-humidity winds and dry climate pushed fires already burning in Ashland approximately 10 miles north, leveling the city of Talent, half of the city of Phoenix and an estimated 2,000 homes and 500 businesses — including Kerr’s cannabis store, Fireside Dispensary.
“It’s complete loss. Everything. It’s all ash,” Kerr says. “I couldn’t even get into the city by the time they called the evacuation.”
Kerr spent the majority of the night of the evacuation in his car, driving back and forth, as near to the fires as he could get, just to get a glimpse of his business.
“Pretty much that night I knew,” he says. “It was just one big glow in that area, and I had reports from other people that it was on fire.”
Kerr opened Fireside on August 10, 2015. The company had eight employees and recently celebrated its five-year anniversary. His business lost roughly $75,000 in product and another $75,000 that was invested in the building.
Even while facing a complete loss, Kerr says this isn’t the end of Fireside Dispensary. He is currently talking with the city about other areas zoned for cannabis businesses. While the company’s insurance provider is still evaluating the damages, Kerr is living off his savings. He is planning to work with some of the area’s farms during the harvest season before trying to restart his retail business.
But considering the devastating losses in the city, he is patiently waiting for them to first reconcile the huge population that has been displaced.
“I am a secondary concern at this point,” he says. “Trying to change a cannabis ordinance around while so many people are homeless seems selfish.”
Humboldt County, California
In Humboldt County, Villa Paradiso Farms president Robert Steffano stayed behind during the evacuations on September 9 to help protect the community from the encroaching fire with a handful of other resident firefighters. As president of the Palo Verde Volunteer Fire Department, former deputy fire chief of the Orange City Fire Department and a resident cannabis farmer for more than three decades, Steffano has grown accustomed to the threat of wildfires and the challenges that come with his rural lifestyle.
“We were looking at complete and total financial ruin,” Steffano says. “People fled.”
In total, the evacuation lasted eight days. For the first four days, Steffano and his fellow firefighters were locked inside the community.
“Four days with no other response agencies other than the cops at the roadblock,” Steffano says. “When we started seeing helicopters it really made us feel better.”
During the last three days of the evacuation, the Humboldt County Planning Department started issuing day-passes for compliant farms, allowing cultivators to briefly tend to their crops for six hours each day.
While Steffano and the firefighters that were locked inside the evacuated area did what they could to maintain other farms in the community, many growers returned the full eight days later to find their crops covered in ash.
At Villa Paradiso, the damages from ashfall varied by the stage of the plant’s growth. Some of the farm’s plants were two weeks from harvest and the ash clung to the sticky trichomes, even after he and his team made several passes with leaf blowers to clean the loose residue and a gently washed the flowers with fogging nozzles. CW Analytical Labs provided Steffano with free testing to see if the ash-laden flower would still be useable in some capacity. Despite all odds, the flower came back clean and suitable for processing, and Steffano says the extract does not have a smokey taste or smell.
Meanwhile, Ruth Bergman is less optimistic about her future as a craft cannabis farmer.
Bergman is a neighbor of Steffano’s and the owner of Deep Roots Farm, a 10,000-square-foot grow. Unlike some growers in the area, she wasn’t locked in during the evacuation period.
Prior to the smoke-filled fall, the plants were growing beautifully, Bergman says. But because of the heavy smoke, the plants simply stopped growing, prompting a small and early harvest.
“A significant portion of our crop finished early and the weight isn’t going to be there,” she says. “I normally chart from the beginning of October to the 14th for harvesting but everything is just done. They weren’t putting on any new growth.”
Bergman suspects the smoke from the fires has done more than block UV rays and spread ash. As an avid integrated pest management practitioner — or “IPM geek” as she puts it — she believes the conditions brought by the fires disrupted her all-natural pest mitigation efforts.
“There’s a much higher pest presence than what I am used to seeing based on how healthy the plants were at the start,” she says. “The mites really moved in quite ferociously and in areas where I normally wouldn’t see mites. And now there’s powdery mildew.”
To make matters worse, during the evacuation, the farm’s resident cats were also removed from the property. But without the protection of the prowling felines, rodents we free to nibble at the bases of cannabis stalks, causing some large branches to fall and further reduce the harvest.
Bergman does not know what the fate of her fall crop will be.
Cave Junction, Oregon
Contract firefighters Rhea and Matt Miller were out scouting the fire’s progress as it moved north into Oregon near their Tier 2 outdoor cannabis farm, Millerville Farms, in Southern Oregon, until the early morning hours of September 8. The couple returned home at 3:30 a.m. and woke just a few hours later to find the fire was now heading in their direction from two different points.
“The fires were cruising at about one mile every 10 minutes,” Rhea Miller says. “I was convinced it was going to reach us that day.”
With the majority of the area’s businesses vacated, Millerville Farms became a makeshift basecamp for the region’s firefighters.
“We converted the area catty-corner to us with Bobcats and leveled it to dirt for a safety zone for people to escape to,” Miller says. “With all the fires that broke out, we were extremely shorthanded. All the area firefighters came together and a tremendous amount of work was done during the first week of the fires.”
The firefighters battled for days, protecting the majority of the area’s businesses from being swallowed by the fire. One hotel in nearby Takilma had responders fighting to stop the blaze right at the property line.
“That was the closest the fires got,” Miller says. “The community actively protected it over one evening; it burned right up to the edge.”
As the fires raged in Oregon, Miller’s duties as a firefighter accumulated quickly and left her and her husband with virtually no time to prep the farm for this year’s harvest. The Millers were able to successfully protect the property from the fire that came within one mile of the business, but now she is playing catch-up to bring in the harvest.
As sungrown cannabis producers, Miller says wildfires always pose some amount of risk. Among other things, the smoke from fire can block out the UV rays from sunlight and cause the plants to flower early. But the falling ash accumulating on Millerville Farms were mitigated by leaf blowers and a small rainfall.
Like many, Chris Anderson was devastated from watching the wildfires destroy millions of acres in California.
“At least a dozen farms I know and people I work with lost everything,” he says. “That number is going to be way higher when the dust settles. I don’t think anyone knows exactly how many farms have lost everything yet.”
Anderson was born and raised in the Emerald Triangle. He has a background in cannabis farming and is now the owner of Redwood Roots Family, a distribution company based in Benbow, California, that provides services to 208 farms in Humboldt, Mendocino and Trinity counties.
In response to the fires, Redwood Roots Family used its vans and trailer to help evacuate 15 farms in one day. After evacuating 15 businesses to the Redwood Roots facility, Anderson received another call from CALFIRE saying that his business now needed to evacuate.
“We then decided to evacuate our facility and transport all the product that we had evacuated off the farms all day up to a sister facility we pay rent on in Arcadia,” Anderson says. “We weren’t done until 1 a.m. or 2 a.m. that night. That was one day. I don’t know how we did it.”
Heather Heath, the owner of Karmic Elevation, an indoor cannabis producer in Oregon, says her operation wasn’t directly damaged from the fire, but it still suffered about $120,000 in lost revenue.
At one point, the Buckhaven Fire came within two miles of Karmic Elevation, forcing the Tier 2 grow to evacuate for one day before changing winds drove the blaze away from the business.
“I could see the fire from my house,” Heath says.
The fire caused Karmic Elevation to lose power for four days during a vital point in the flowering process, leaving its current crop with diminished yields.
“We threw out 33 plants due to the lighting issues,” Heath says. “We lost about $120,000 from the crop we threw out and the diminished yields.”
Lake County, California
Compared with the damages Aster Farms suffered from the 2018 Mendocino Complex Fire, when the whole property burned down, CEO Julia Jacobson says her company is relatively safe this year. Still, even with fires 60 miles to the north and south, her farm was cast in smoke for roughly six weeks.
“We’ve experienced the damage it can do and have rebuilt since then,” Jacobson says. “We’re lucky that we didn’t have any ash.”
The smoke’s arrival during the second week in August lasted all the way through September, the exact weeks the plants at Aster Farms were supposed to be growing buds. Jacobson says that without the proper amount of sunlight, the plants think it’s time to die. Instead of continuing to grow, the plants start to finish early and tighten the buds.
As September passed, the blue skies returned and Jacobson was hoping to rekindle the plants’ growth cycle so they could start flowering once again. But with a lot of the plants at Aster Farms already too far into the flowering cycle harvest came two weeks early. Jacobson suspects Aster Farms will have a smaller yield than what they planned.
“It takes so long to harvest, buck, dry and trim the plants that we won’t know what our yield will be until January,” Jacobson says. “We’re estimating possibly a 10-15% yield loss because we didn’t have a flowering season.”
The damages from the massive fires reach far beyond the businesses consumed by the flames. Todd Foster, a partner at Oath Cannabis & Hemp Insurance, believes there might be a surge in cannabis companies looking to insure themselves in the coming year. But the amount of claims and damages in 2020 will likely cause rates to rise and may even see some insurance providers pull out of the industry altogether.
“Obviously, the providers who are paying out hundreds of millions of dollars are going to want to recoup that, so that means there are going to be carriers that exit the market and less choices,” Foster says. “I know, positively, that the prices are going to go up. That’s going to happen around the first of the year.”
Foster says carriers have already paid out more than $11 million in damages.
“We’ve definitely had a lot of clients burn to the ground,” Foster says.
Cannabis operators in areas with high fire scores — away from fire stations, hydrants and other fire-fighting measures — will see the highest increases in insurance rates come January 1, 2021, Foster says.
According to BDSA co-founder and president Liz Stahura, cannabis shortages from the fires could have an impact on industry’s supply chain for years to come.
“While we don’t have hard numbers on the amount of growers impacted across all three states (California, Oregon and Washington), the air quality this year has been far worse than that in past fire seasons, so crop loss could be at an all-time high,” Stahura says.
From what Miller has seen of the damages, she doesn’t expect a shortage of cannabis flower in Oregon.
Jacobson says that the fires across California will result in a massive drop in supply for 2021. She says that the shortage of flower during the summer of 2020 resulted in wholesale prices doubling, though the prices at retail remained relatively unchanged.
Jacobson says the companies that will be most affected by the shortage of flower will be the white-label brands and not the producers who supply them.
“Everybody is going to be scrambling for the same product,” Jacobson says.
Humboldt isn’t the only area in California where the shortages will come from, as many of the state’s concentrated growing regions, including Sonoma, Mendocino, and Santa Cruz counties, all suffered serious fire damages.
With fire-related damages throughout the West Coast, and with an early frost destroying a large swath of crops in Colorado, Anderson believes “cannabis shortage” will be the narrative for 2021.
“There’s no doubt in my mind that the cannabis unaffected by smoke in the market is going to demand a high price,” Anderson says. “There was already a limited amount of the triple-A, sungrown flower on the market and this is certainly going to limit it even more.”