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Despite Hemp Legalization, FDA Will Still Consider CBD Products Largely Illegal
FDA maintains hemp oil is a drug ingredient, and requires approval for products.
Published: Dec 23, 2018
Reuters
By ASSOCIATEDPRESS
SEATTLE — The hemp industry still has work ahead to win legal status for hemp-derived cannabidiol, or CBD oil, as an ingredient in food or dietary supplements despite the big farm bill President Donald Trump signed last week designating hemp as an agricultural crop.
CBD oils have become increasingly popular in lotions, tinctures and foods, but their legal status has been murky and the Food and Drug Administration has sent warning letters to some companies making health claims for CBD.
In a statement following Thursday’s bill signing in Washington, FDA Commissioner Scott Gottlieb restated his agency’s stance that CBD is a drug ingredient and therefore illegal to add to food or health products without approval from his agency.
“Selling unapproved products with unsubstantiated therapeutic claims is not only a violation of the law, but also can put patients at risk, as these products have not been proven to be safe or effective,” Gottlieb wrote.
CBD is a non-psychoactive compound found in hemp, a version of the cannabis plant that is low in THC, the part of cannabis that gives pot its high.
An FDA-approved drug for the treatment of seizures, Epidiolex, contains cannabis-derived CBD. GW Pharmaceuticals’ GWPH, +3.72% syrup became the first prescription drug derived from the cannabis plant in June.
The FDA statement also specified parts of hemp that are safe as food ingredients, but the CBD stance disappointed advocates. Courtney Moran, a lobbyist for Oregon hemp farmers, said she plans to work with U.S. Sen. Ron Wyden, an Oregon Democrat, to nudge the FDA toward greater acceptance of CBD.
“We do hope the FDA does clear a pathway for these products that have already hit store shelves and are out in the marketplace,” Moran said. She said it’s an “opportunity for industry to educate the FDA.”
The FDA statement said three ingredients derived from hemp — hulled hemp seeds, hemp seed protein and hemp seed oil — are safe as foods and won’t require additional approvals, as long as marketers do not make claims that they treat disease.
Hemp, like marijuana, already was legal in some states before Trump signed the farm bill. But now hemp farmers will be able to buy crop insurance, apply for loans and grants, and write off their business expenses on their taxes like any other farmer.
One Year of Legal Pot Sales and California Doesn’t Have the Bustling Industry it Expected. Here’s Why
Retailers and growers say they’ve been stunted by complex regulations, high taxes and decisions by most cities to ban cannabis shops.
DEC 27, 2018 | 12:05 AM
When Californians voted in 2016 to allow the sale of recreational marijuana, advocates of the move envisioned thousands of pot shops and cannabis farms obtaining state licenses, making the drug easily available to all adults within a short drive.
But as the first year of licensed sales comes to a close, California’s legal market hasn’t performed as state officials and the cannabis industry had hoped. Retailers and growers say they’ve been stunted by complex regulations, high taxes and decisions by most cities to ban cannabis shops. At the same time, many residents are going to city halls and courts to fight pot businesses they see as nuisances, and police chiefs are raising concerns about crime triggered by the marijuana trade.
Gov.-elect Gavin Newsom, who played a large role in the legalization of cannabis, will inherit the numerous challenges when he takes office in January as legislators hope to send him a raft of bills next year to provide banking for the pot industry, ease the tax burden on retailers and crack down on sales to minors.
Hundreds of new California laws take effect Jan. 1. How will they affect you? »
“The cannabis industry is being choked by California’s penchant for over-regulation,” said Dale Gieringer, director of California NORML, a pro-legalization group. “It’s impossible to solve all of the problems without a drastic rewrite of the law, which is not in the cards for the foreseeable future.”
After voters legalized marijuana two years ago under Proposition 64, state officials estimated in there would be as many as 6,000 cannabis shops licensed in the first few years. But the state Bureau of Cannabis Control has issued just 547 temporary and annual licenses to marijuana retail stores and dispensaries. Some 1,790 stores and dispensaries were paying taxes on medicinal pot sales before licenses were required starting Jan. 1.
(Los Angeles Times)
State officials also predicted that legal cannabis would eventually bring in up to $1 billion in revenue a year. But with many cities banning pot sales, tax revenue is falling far short of estimates. Based on taxes collected since Jan. 1, the state is expected to bring in $471 million in revenue this fiscal year — much less than the $630 million projected in Gov. Jerry Brown’s budget.
“I think we all wish we could license more businesses, but our system is based on dual licensing and local control,” said Alex Traverso, a spokesman for the state Bureau of Cannabis Control, referring to the requirement that cannabis businesses get permission from the state and the city in which they want to operate.
Less than 20% of cities in California — 89 of 482 — allow retail shops to sell cannabis for recreational use, according to the California Cannabis Industry Assn. Cities that allow cannabis sales include Los Angeles, Oakland, San Francisco and San Diego.
Coverage of California politics »
Eighty-two of Los Angeles County’s 88 cities prohibit retail sales of recreational marijuana, according to Alexa Halloran, an attorney specializing in cannabis law for the firm Solomon, Saltsman & Jamieson. Pot shops are not allowed in cities including Burbank, Manhattan Beach, Alhambra, Beverly Hills, Inglewood, Compton, Redondo Beach, El Monte, Rancho Palos Verdes and Calabasas.
“While some cities have jumped in headfirst, we've taken a deliberate approach,” said Manhattan Beach Mayor Steve Napolitano, “to see how things shake out elsewhere before further consideration. I think that's proven to be the smart approach.”
Can you carry marijuana in LAX? Yes, but it’s more complicated than that
SEP 28, 2018 | 6:40 AM
Voters have also been reluctant to allow cannabis stores in their communities.
Of the 64 California cities and counties that voted on cannabis ballot measures in the November midterm election, eight banned the sale of cannabis or turned down taxation measures, seven allowed sales and 49 approved taxes on pot businesses, said Hilary Bricken, an attorney who represents the industry. Among them, voters in Malibu approved pot shops while Simi Valley residents voted for an advisory measure against allowing retail sales.
Javier Montes, owner of Wilmington pot store Delta-9 THC, says he is struggling to compete with a large illicit market unburdened by the taxes he pays as a licensed business.
“Because we are up against high taxes and the proliferation of illegal shops, it is difficult right now,” Montes said. “We expected lines out of our doors, but unfortunately the underground market was already conducting commercial cannabis activity and are continuing to do so.”
Montes, who received his city and state licenses in January, says his business faces a 15% state excise tax, a 10% recreational marijuana tax by the city of Los Angeles and 9.5% in sales tax by the county and state — a markup of more than 34%.
He says there isn’t enough enforcement against illegal operators, and the hard times have caused him to cut the number of employees at his shop in half this year from 24 to 12.
“It’s very hard whenever I have to lay people off, because they are like a family to me,” said Montes, who is vice president of the United Cannabis Business Assn., which represents firms including the about 170 cannabis retailers licensed by the city of Los Angeles.
DELTA-9 faces a 15% state excise tax, a 10% recreational cannabis tax by the city of Los Angeles and 9.5% in sales tax by the county and state, the shop owner says. (Marcus Yam / Los Angeles Times)
Sky Siegel, who operates a cannabis business in Studio City, said he recently gave up trying to open another store in Santa Monica because of its restrictions on such businesses.
“It turns into this ‘Hunger Games’ to try to get a license,” said Siegel, who is general manager of Perennial Holistic Wellness Center, which has a dozen employees in Studio City and also operates a delivery service.
He says his firm is up against thousands of unlicensed delivery services going into cities where storefronts are banned.
“To me, it doesn’t make sense” that many cities have prohibited shops, he said. “Banning does nothing. It’s already there. Why not turn this into a legitimized business, which is what the people want.”
Marijuana use is rising among pregnant patients. Not so fast, doctors warn »
California has also issued fewer cultivation licenses than expected in the first year of legalization, with about 2,160 growers registered with the state; an estimated 50,000 commercial cannabis cultivation operations existed before Proposition 64, according to the California Growers Assn. Some have given up growing pot, but many others are continuing to operate illegally.
The trade group hoped to see at least 5,000 commercial growers licensed in the first year, said Hezekiah Allen, the group’s former executive director who is now chairman of Emerald Grown, a cooperative of 130 licensed cultivators.
“We are lagging far behind,” Allen said. “It’s woefully inadequate. Most of the people in California who are buying cannabis are still buying it from the unregulated market. There just isn’t a reason for most growers to make the transition.”
Assemblyman Jim Wood (D-Healdsburg), who has crafted cannabis regulations, said the licensing system had not yet lived up to its promise.
“The state licensing process this past year has been a painful one,” said Wood, adding that the complex rules are particularly difficult for small businesses. “I recognize that this has been a significant undertaking for the state, and you combine that with the cannabis industry learning how to navigate the process — it’s been difficult for them both.”
The legalization of recreational pot has also created tension in areas of the state where cannabis growers are operating close to residents.
Jesse Jones said he moved his family to Petaluma from Marin County six months ago so his three children could enjoy more open space, but he is now fighting a proposal for a cannabis farm to operate a few hundred feet from his home, in part because of safety issues.
“You are going to have what is still a [Schedule 1] narcotic being produced in line of sight of my kids’ trampoline, on a shared road that was never intended for this type of commercial operation,” said Jones, an energy industry executive.
Sanjay Bagai, a former investment banker who lives with his family next door to a new cannabis farm in Sonoma County, is a leader of a residents group called Save Our Sonoma Neighborhoods, which has obtained a preliminary court ruling against one cannabis-growing operation.
Bagai said his group was “not anti-cannabis” but added that pot cultivation “is not something that fits into our neighborhood here.”
“The smell is horrific,” he said of the marijuana plants. “It’s like rotting flesh. And the traffic is insane.”
Quality-of-life complaints have also surfaced in neighborhoods where cannabis sellers have set up shop.
Van Nuys Neighborhood Council President George Thomas said he had received about a dozen complaints in the last year from residents living near pot stores who were concerned about loitering, the smell of marijuana smoke and other issues. Thomas, who is the publisher of the Van Nuys News Press and is an LAPD volunteer, passes complaints on to police officers.
“If they are not in compliance,” Thomas said, “if they are within a thousand feet of a school or church, we are totally against them and we are happy to work with the neighborhood prosecutor in the city attorney’s office to shut them down.”
At the same time, he said, the neighborhood council has worked with licensed cannabis stores to get them involved in improving the community and has asked the Los Angeles City Council to devote some of the tax revenue from Van Nuys shops to solving local problems, including homelessness and crime.
Meanwhile, despite concerns from law enforcement, the state is finalizing a proposal to allow deliveries throughout California — including in cities that ban retail stores. The new rule by Lori Ajax, chief of the state Bureau of Cannabis Control, is expected to be implemented in January.
Ajax says she believes that as the system is refined and is shown to operate successfully in some cities, other local governments will allow retail pot sales. But opponents of pot legalization, including Kevin Sabet, president of Smart Approaches to Marijuana, are happy that most cities are saying “no” to selling the drug.
“The residents of Compton and these other cities have seen the ills that come with allowing marijuana in the door,” Sabet said, “including skyrocketing drugged driving; the promise, then failure of social justice; and the targeting of children through the use of colorful and deceptive candies, gummies and sodas.”
Even in cities that allow cannabis sales, businesses face big hurdles.
The various taxes and fees could drive up the cost of legal cannabis in parts of California by 45%, according to the global credit ratings firm Fitch Ratings.
There is less of a tax burden in Oregon, where voters legalized recreational pot in 2014, and state and local taxes are capped at 20%. With nearly a tenth of the population of California, that state has more licensed cannabis shops — 601. On a per capita basis, Alaska has also approved more pot shop licenses than California, — 94 so far. The state imposes a tax on cultivation, but there is no retail excise tax on pot.
Assemblyman Rob Bonta (D-Alameda) tried and failed this year to push for a temporary reduction in California’s pot taxes to help the industry get on its feet.
“It’s a work in progress,” Bonta said of the current regulatory system. “We knew we weren’t going to get it exactly right on Day 1, and so we’re always looking for ways to achieve the original intentions and goal.”
Bonta said he may revisit the taxation issue in 2019 and is exploring the idea of having the state do more to get cities to approve businesses, possibly by providing advisory guidelines for local legalization that address cities’ concerns.
California cannabis businesses, like their counterparts in Colorado and Oregon, also face costs to test marijuana for harmful chemicals.
“The testing costs are excessive — $500 to $1,000 per batch, and most crops involve multiple batches,” said Gieringer, the director of California NORML. “No other agricultural product is required to undergo such costly or sensitive tests.”
Another problem hampering the legal market is a lack of banking for cannabis businesses. Federally regulated banks are reluctant to handle cash from pot, which remains an illegal drug under federal law.
“Banking continues to be an issue in terms of creating a real public safety problem with significant amounts of cash being moved for transactions,” said Bonta, who co-wrote a bill this year that would have created a state-sanctioned bank to handle money from pot sellers. It failed to pass after legislative analysts said the proposal faced “significant obstacles,” including no protection from federal law enforcement.
Industry leaders and activists said they knew it would be a slow process to establish a strong legal market, noting other states with legal pot, including Colorado, Washington and Oregon, also faced growing pains and problems along the way.
But Ajax, the state pot czar, says her agency has had a productive first year, issuing initial licenses, refining the rules and stepping up action against unlicensed operations, including partnering with the Los Angeles Police Department to seize $2 million worth of marijuana products from an unlicensed shop in Sylmar in October.
“I am optimistic about the coming year, where our focus will be primarily on getting more businesses licensed and increasing enforcement efforts on the illegal market,” Ajax said.
Danone Invests in Urban Farming Business Agricool
French dairy giant Danone has taken part in a US$28m investment round in local pesticide-free fruits and vegetable business Agricool.
By Andy Coyne | 5 December 2018
Danone - investing in French urban farming business
The investment was made through its Danone Manifesto Ventures venture fund arm.
Urban farming business Agricool said the investment will allow it to pursue its ambition to make "excellent, pesticide-free fruits and vegetables accessible to all".
The other investors in the round included Bpifrance Large Venture Fund, French businessman Antoine Arnault via Marbeuf Capital, Docker co-founder Solomon Hykes, as well as a dozen other 'business angels'.
Existing investors - which include venture-capital funds Daphni and XAnge, Xavier Niel via the Kima Ventures venture-capital firm and Henri Seydoux, the founder of civil-drone business Parrot - also participated in the new funding round.
In the past three years, Agricool's teams have developed a technology to grow local, healthy fruits and vegetables more productively and within small and controlled spaces, known as "Cooltainers" (recycled shipping containers transformed into urban farms).
Agricool said that, thanks to this new funding round, it will be able to confirm its role in the development of this new type of agriculture, while positioning itself as a key player in the segment of vertical farming in France and worldwide.
It said it plans to multiply production by a hundredfold by 2021, in Paris first, then internationally starting with Dubai, where a container has already been installed.
Agricool has ambitions to employ 200 people by 2021.
Disruptor of the Year: Constellation Brands
Constellation Brands' stake in Canopy Growth, the largest investment in the marijuana market to date, could fan the flames of a cannabis arms race between U.S. alcohol manufacturers.
AUTHOR
Emma Liem@emma_liem
PUBLISHED
Dec. 3, 2018
CEO: Rob Sands
Total investments in marijuana: $4.07 billion
Outlook: Constellation Brands' stake in Canopy Growth, the largest investment in the marijuana market to date, could fan the flames of a cannabis arms race between U.S. alcohol manufacturers.
When Constellation Brands invested $3.9 billion in Canopy Growth this summer, it not only made the largest investment in the marijuana market to date, but broke an industry taboo that had kept many beverage players on the sidelines.
The cash infusion increased the beer giant’s stake in the Canadian cannabis supplier to 38%, and Constellation will nominate four directors to the company’s seven-member board as part of the deal. The partnership has legitimized a trend that beer makers and analysts have been buzzing about for years: cannabis is set to become a cash cow for the alcohol industry.
“I cannot imagine a more disruptive development within the alcohol industry in the last couple of millennia, to be honest,” Spiros Malandrakis, head of alcoholic drinks at Euromonitor International, told Food Dive of the rise of cannabis in the beer space.
But while many bemoaned the marijuana industry’s impending threat to alcohol sales, Constellation identified cannabis as a potential growth driver in the sluggish U.S. beer space.
"Over the past year, we've come to better understand the cannabis market, the tremendous growth opportunity it presents, and Canopy's market-leading capabilities in this space," Constellation CEO Rob Sands said in a company release following the August investment. "We look forward to supporting Canopy as they extend their recognized global leadership position in the medical and recreational cannabis space."
Constellation isn't a first-mover in this budding segment, however. Craft brewers were the first to begin dabbling with marijuana-infused product. Heineken-owned Lagunitas Brewing rolled out a non-psychoactive, cannabis-flavored IPA brewed with marijuana terpenes in 2017. This year, it debuted a THC-based sparkling water, complete with the marijuana high.
But Constellation’s formidable advantage in the Canopy partnership can’t be ignored. The cannabis supplier, valued at $5.4 billion, will use the American beer titan’s financial backing to enter emerging recreational cannabis markets, as well as achieve global scale in the nearly 30 nations working toward federal medical cannabis programs. Though the company doesn't plan to sell marijuana-based beverages domestically before the U.S. fully legalizes the substance, this market reach — combined with Canada's legalization of recreational marijuana use in October — has driven rival beer brands to enter the space.
"Once Constellation broke the taboo, people started discussing [cannabis innovation] much more openly, and the other thing we have to remember is that not many cannabis companies in Canada are right now available for M&A."
Spiros Malandrakis
Head of alcoholic drinks, Euromonitor International
"In a way it's a game of musical chairs. There aren't many chairs left. So even for the biggest players in the alcohol space, they're not going to have the luxury of an infinite amount of time to choose their chair before the music actually stops."
Less than a year after Constellation's initial investment in Canopy Growth, Molson Coors announced that its Canadian business had formed a joint venture with Hydropothecary Corp. to make nonalcoholic, cannabis-infused drinks to sell in Canada. As part of the deal, Molson Coors Canada gained a 57.5% controlling interest in the firm.
But the most striking result of the M&A domino effect that began with the Constellation-Canopy partnership came from beyond the alcohol segment entirely. In September, Coca-Cola announced it was in talks with Canadian marijuana supplier Aurora Cannabis about developing marijuana-infused drinks. The soda behemoth's stock climbed 0.72% to $46.32 on the news, and boosted the stock of other cannabis companies as well.
"We are closely watching the growth of non-psychoactive CBD as an ingredient in functional wellness beverages around the world," Coke spokesman Kent Landers told Bloomberg News. "The space is evolving quickly. No decisions have been made at this time."
On a conference call in October, Coca-Cola CEO James Quincey said the company "doesn't have any plans at this stage" to enter the CBD market.
As interest in the medicinal properties of cannabinoids grows and stigma around marijuana use relaxes, alcohol manufacturers face a new path to growth. Whether or not these players can unseat Constellation's lead, however, is an open question.
"You’re looking at an arms race which, in my mind, is already in full swing," Malandrakis said. "There’s no doubt in my mind that the 'green tide' is inevitable at this stage, and it's just going to gain more momentum moving forward."
Young Fijian Makes Good Use Of Govt Scheme
A Fijian who studied in India has made the most of Government’s Young Entrepreneurship Scheme and embarked on a journey to combine engineering and agriculture.
September 22
18:56 2018
by SWASHNA CHAND , SUVA
Entrepreneur, Rinesh Sharma.
A Fijian who studied in India has made the most of Government’s Young Entrepreneurship Scheme and embarked on a journey to combine engineering and agriculture.
Rinesh Sharma, 25, is an entrepreneur living in Lautoka who has started up something unique.
“While studying in India, I came across a software engineer who had an indoor hydroponics farm in Goa,” he said.
“After reading his success story, I made up my mind to do the same back home.”
Hydroponics is a method of growing plants without soil by using mineral nutrient solutions in a water solvent.
“Engineering combined with agriculture allows me to grow plants in its special conditions and parameters, maximising faster yields,” he said.
“I grow include strawberries, mint, coriander, coral lettuce and butter crunch lettuce. The idea of hydroponics came to me in my third year of engineering.
“Since then, I have researched every day about executing this project on a commercial scale in Fiji.”
Mr Sharma said he came back to Fiji in May and started an automated hydroponics system, in which he grew green leafy vegetables in his backyard.
“This was a challenging process because it was almost impossible to find hydroponic system supplies in Fiji, but regardless I made a small prototype where I can harvest 372 plants per month,” he said.
“Doing farming is the best thing I have done and perception really does matter because we have a lot of people who left farms and moved to the urban life and this has created a huge gap to fill in the field of agriculture.”
Mr Sharma said for him it was a mission to feed the world and he was going to start with his country.
“Upon my arrival in Fiji, I had applied for the YES entrepreneurship scheme run by the Ministry of Trade, Tourism and Industry with the intention to begin an automated hydroponics farm in Fiji on a commercial scale and got a grant of $20,000,” he said.
He is thankful to the Government for providing him with the assistance.
“The assistance is motivating and encouraging for us the younger generation to do step forward and do something,” he said.
“I keep challenging myself with growing the most impossible edible items such as blueberries, raspberries and apples as well.
“It is important that people of Fiji are able to afford proper nutritional meals every day and that to at low cost.
“So, as a hydroponics farmer, I am able to control any device in my farm through a single touch on my phone via internet and I am also able to receive any data changes that may occur, such as change in PH, moisture, temperature.
“It was a privilege to be given a scholarship by the Indian High Commission where I got to learn so much.
“I came back to Fiji with the intention of working with the Government and their expertise to change and shape farming methods in Fiji.”
Edited by Epineri Vula
Feedback: swashna.chand@fijisun.com.fj
Get The Free Report On The Investment Potential Of Greenhouse Business In Russia 2018
Last year was one of the most successful years for Russia’s greenhouse industry. Over 250 ha new commercial greenhouses were commissioned, the number of 5-gen greenhouses increased. Further expansion of greenhouse area is expected – new projects are set to be launched in different regions across the country.
Last year was one of the most successful years for Russia’s greenhouse industry. Over 250 ha new commercial greenhouses were commissioned, the number of 5-gen greenhouses increased. Further expansion of greenhouse area is expected – new projects are set to be launched in different regions across the country.
Prior to the International Investment Forum and Exhibition “Greenhouse Complexes Russia 2018”, Vostock Capital team of analysts has conducted a research on the investment potential of Russian greenhouse industry, which covers:
the information about the prospects for the development of Russian greenhouse industry
new investment greenhouse projects (construction and modernisation)
criteria for the selection of technology and equipment by the decision-makers of greenhouse companies and agriholdings and many other important results.
Request the report:
The research involved over 250 respondents, including the C-suite of agroindustrial holdings and greenhouse complexes, suppliers of latest technologies and equipment, regulators, project operators, representatives of financial institutions and investors, independent market experts.
The international Forum and Exhibition “Greenhouse Complexes Russia 2018” is the high-class professional platform to unlock investment in Russian greenhouse industry, discuss industry development strategy, share experiences between key market players and conclude new lucrative contracts.
The Event spans investors from the CIS, Europe, and Asia, initiators of investment projects from across Russia, decision-makers of federal and regional agriholdings, dedicated ministries and agencies, heads of regions, retail chain executives, service providers, presidents of national unions and associations.
Contact: Elvira Sakhabutdinova, Project Director
ESakhabutdinova@vostockcapital.com Tel. +7 499 505 1 505
Website: http://www.greenhousesforum.com/en/
In Terms Of Revenue Global Smart Agriculture Industry And Attractive Regional Analysis
The global smart agriculture Industry is segmented based on solutions, application, and region.
The smart agriculture Industry plays an important role in meeting the accelerating food demand of the growing global population. The smart agriculture devices help in continuous field monitoring, precision crop analysis by engages different sensors, high-quality cameras, microcontrollers, web-based platforms, and smart devices to gather data from the field. It also helps in analyzing the collected data by transferring the data to the operator or the farmer for making an accurate decision. These benefits of smart agriculture are boosting the Industry for smart agriculture to grow over the period from 2017 to 2025.
The global smart agriculture Industry is segmented based on solutions, application, and region. Based on solutions, the Industry for smart agriculture is segmented as network management, agriculture asset management, supervisory control, and data acquisition, logistics and supply chain management, smart water management and others. The others segment includes mobility solution, connectivity solutions, and quality assurance solutions.
On the basis of application, the smart agriculture Industry has been segmented as precision agriculture, livestock management, fish farming, smart greenhouse, and others. The others segment include indoor farming, horticulture, dairy management
Regionally, the Industry for smart agriculture is categorized as North America, Europe, Asia Pacific, Middle East and Africa and Latin America.
North America contributed the largest Industry share of the overall revenue generated in 2016 in the smart agriculture Industry. Smart water management is the fastest growing segment in the solution segment in the North American smart agriculture Industry. In the application segment, precision agriculture held the largest Industry share and livestock monitoring is anticipated to be the fastest growing segment. The U.S. contributed largest Industry share in North America. This is attributed to the fact that the companies in the U.S. are conducting extensive research and development with joint ventures or partnerships in order to enhance the agriculture technology to minimize the human involvement on the field and produce ample food to meet the global food requirement. In addition, other factor boosting the U.S. Industry is the individual farmers and farming corporate houses deployed the smart agriculture tools and equipment heavily in 2016. Mexico is the fastest growing region in the North American Industry for smart agriculture due to rapid deployment of tools and equipment and increased fish farming business.
The smart agriculture Industry in Europe held the second largest Industry in 2016. The European smart agriculture Industry stands third in terms of growth rate globally. The growth of smart agriculture Industry in Europe is attributed to the fact that the U.K. is investing huge amounts in research and developments in order to develop robust technologies to ease the farmers in agriculture procedure. Due to this Industry for smart agriculture contributed the largest Industry share in 2016 in the European smart agriculture Industry. The growth rate of smart agriculture Industry in Italy is significant, due to the increasing demand for livestock monitoring. Germany smart agriculture Industry is estimated to be the second fastest growing region, due to the growing demand for smart greenhouse. The growth rate of smart agriculture Industry in Germany is considerable over the period from 2017 to 2025.
Asia Pacific is the most attractive region in the global smart agriculture Industry, growing at an influential rate over the period from 2017 to 2025. The Industry for smart agriculture in Asia Pacific is attributed to the fact that the countries such as China, Japan, and Australia are procuring the smart agriculture tools and equipment rapidly in order to minimize the human effort in agriculture, save the agriculture assets such as plants and animals, and the increased need for livestock monitoring. China held the largest Industry in 2016 while Japan is the fastest growing region in the smart agriculture Industry in Asia Pacific.
Middle East and Africa smart agriculture Industry is expected to grow at a fair rate from 2017 to 2025. Owing to the fact that fish farming is the most demanding segment in the region. South Africa held the largest Industry share in the smart agriculture Industry in the Middle East and Africa due to increased precision agriculture in the region.. Egypt is estimated to be the fastest growing region in the Middle East and Africa smart agriculture Industry, growing at a significant rate.
Latin America is the second fastest growing region in the global smart agriculture Industry. The growth rate of smart agriculture Industry in Latin America is significant in comparison to North America, Europe and Middle East and Africa. Latin American smart agriculture growth rate is attributed to the increasing need for smart water management in order to save agriculture water in varied weather conditions and also to grow crops with less usage of harmful chemicals and fertilizers. Brazil held the largest Industry in the Latin American smart agriculture Industry in 2016 and it is estimated to be the fastest growing region over the period from 2017 to 2025. This is due to the rapid growth of smart greenhouse.
People Don’t Buy Products, They Buy Better Versions of Themselves
What Apple, Samsung, and Starbucks learned from Pepsi
What Apple, Samsung, and Starbucks learned from Pepsi
Photo by John Fornander on Unsplash
The year was 1957, and Pepsi — like many of the youth at that time — was dealing with an identity crisis. Despite efforts from marketers, Pepsi was being outsold by its biggest competitor and perpetual market leader — Coke — by a factor just shy of six to one, even as it was selling at half of Coke’s price. It wasn’t the product that was lacking, it was that Pepsi’s brand ethos — indecisive and directionless — was a fragmented shell of what it would need to become to take on Coke.
At the time, Coke was unrivaled, having succeeded in convincing the American public that they’d captured everything good and wholesome about American life within the murky confines of a glass bottle. This clear transcendence of the competition was not unlike Apple’s; like devotees react viscerally to a green speech bubble in iMessage, so too was it that, to anyone who embraced the deeply American traits of exceptionalism, community-mindedness, and of course, Santa Claus, consuming anything other than Coke would’ve been considered heresy.
Coke even affiliated itself with Santa Claus. Photo by Library of Congress/Corbis/VCG/Getty
In 1963, Pepsi hired a young advertising executive named Alan Pottasch to address the issue. Pottasch’s task was, to put it gently, difficult. He was to reinvigorate a brand competing against one of the most successful of all time, a product that not only outclassed Pepsi in every consumer-driven category, but was also — chemically — nearly identical. And so Pottasch made a decision that would later become iconic — as he put it, “…to stop talking about the product, and start talking about the user.” Here is Tim Wu in his book, The Attention Merchants, on the decision:
[Pottasch] thus conceived of marketing Pepsi without reference to its inherent qualities, focusing instead on an image of the people who bought it, or should be buying it.
For the first time in history, a brand decided to promote the type of user that purchased a product as opposed to the product itself. Beyond that, Pepsi promoted the idea of an entirely new generation, one free from the manipulative, consumerist messages being perpetuated by the mass media. (It was, after all, the 1960s.) This group would come to be known as “The Pepsi Generation.”
The Pepsi Generation was revolutionary because it was the first time a brand convinced people to purchase their product by focusing on the type of person that doing so made them. No generation before had ever so vocally longed to transcend themselves — to escape the consumerist mindset and achieve truly independent thought — and thus Pepsi’s message, drink our product and do exactly that, reached the perfect group at the perfect moment.
Here’s Wu quoting Pottasch on the success of the campaign:
“For us to name and claim a whole generation after our product was a rather courageous thing,” Pottasch would later remember, “that we weren’t sure would take off.” But his intuition would prove correct. “What you drank said something about who you were. We painted an image of our consumer as active, vital, and young at heart.”
Over the next decade, Pepsi — as a result of the Pepsi Generation campaign — gained significant market share on Coke. And while the campaign was revolutionary, the recipe for its success was simple. As Wu points out, “Desire’s most natural endpoint is consumption.” In other words, the campaign simply reimagined what people desired. This generation longed to escape consumerism, and the fact that Pepsi convinced them to do so by embracing it — purchasing a Pepsi, after all, is about as consumerist as it gets — is a testament to the genius of the campaign. Those who bought in and became a part of the Pepsi generation were searching for a new way to feel, rather than a new beverage to drink. Pepsi’s genius was that it found a way to be both.
The profundity of the Pepsi Generation campaign is twofold. First, its success reinvigorated a brand on the verge of being knocked out in an early round by one of the greatest competitors of the 20th century — Coke. Second, even decades later, it is nearly impossible to find a brand that has not used the strategy Pepsi pioneered: selling not a product, but a better version of ourselves.
Consider Apple. To be an Apple user — at least in the era of Jobs — was to “think different.” Critics might laugh at that characterization of an Apple user now, given the homogeneity and ubiquity of Apple products, especially among the wealthy. But those critics would miss what Apple didn’t: people don’t buy products because of what those products do, they buy products because of what they can do — or what they imagine they can do — with them. This idea even permeates Apple’s retail strategy. Apple employees will never show you how a product works, rather they will let you use it, forcing you to familiarize yourself with the product, yes, but more importantly, yourself in its presence. A diverse range of product options to choose from, after all, will never be as captivating as a homogenous product that turns you into a superhero — and Apple has the latter in spades.
The silhouette is nothing if not an invitation for you to imagine yourself in the context of the iPod. Photo by Justin Sullivan/Getty
Samsung learned this the hard way, dogmatically focusing as they did for the longest time on promoting the features of their products, as opposed to the person you could be by using them. Now they avoid talking about the speed of their processors or the depth of the blacks in their screens because 99% of people don’t care; what they do care about — selfishly — is what they will become — “makers, directors, creators,” in the words of Casey Neistat — if they use a Samsung product. The message? Be like us. The solution? Buy a Samsung.
Samsung even reworked Pepsi’s initial genius, realizing that it is as powerful to portray the person people aspire to be as it is to portray the person they aspire not to be — in Samsung’s case, the brainwashed Apple user who never makes the switch. The consumer who finally does is the one Samsung shows in their commercial, “Growing Up,” the better version of the “Apple Sheep,” portrayed leaving behind those who foolishly opt for the iPhone, the clearest among them a scowling man with the iPhone X’s trademark “notch” etched into his hairline. The message? Don’t be him. The solution? Buy a Samsung.
Samsung’s “Growing Up” ad.
Itis far from just tech companies, though. Adidas and Nike both do it, the former with a similar line of thinking to Samsung’s, and a similar list of influencers. Starbucks does it by crafting beverages like the Unicorn Frappuccino, a drink that famously and unsurprisingly “looks better than it tastes.” While a poorly-flavored but photogenic drink wouldn’t have sold in prior generations, to this generation — our generation — it does. Why?
Similar to how Pepsi understood they would never compete with Coke on product alone, Starbucks understands that in 2018, it is less about the drink itself than it is about who the drink makes you — on Instagram, and thus in real life. And regardless of what you think about us millennials — narcissistic, selfish, vain, outspoken — one thing is abundantly clear: as a result of social media and the Internet, our generation is more conscious of how we are perceived — by friends, family, colleges, jobs, hell, even people we’ve never met — than any other generation, ever.
Social media is well-understood to be contributing to identity politics, but I’d argue it’s contributing to something deeper: identity paralysis. This condition is one in which we have a forced awareness of how everything we say and do — even the seemingly inconsequential, like the shoes we wear, or the airline we fly — reflects on us. It follows that our generation would also be uniquely drawn to brands that make us feel how we want to feel about ourselves, even as how we want to feel about ourselves is often nothing more than how we want to be perceived externally. Like Starbucks with the Unicorn Frappuccino, we prioritize external perception over just about everything else. The social media market, where we live now, demands a focus on visible characteristics — which are, by their very nature, external — from designer drinks, yes, but from individuals, too.
Given all of this, I propose that analysts routinely overlook how people feel in the context of a brand when considering the value of a company. This “statistic” isn’t discussed on earnings calls and there is no way to measure it on a balance sheet. But perhaps that’s because it has only begun to matter; Pepsi, after all, was the first company in history to market itself by promoting the image of consumer that drank it, as opposed to the product itself — and that was only 50 years ago. Since then, consumers, aided by social media, have become far more conscious of who they are in the context of the products they use than even Pepsi could’ve imagined. In this society of ultra-conscious consumers, successful brands will be those that make consumers feel the way they want to feel about themselves.