The recreational and legal market for marijuana continues to thrive and has grown into one of the top-earning industries of recent times. With more and more states have legalized marijuana, now is the ideal time to get into the market.
Below, we’ll outline the estimated costs of growing legal marijuana in the various kinds of setups that you could encounter. These are fantastic starting numbers however if you wish to know exactly how much it will cost you, down to the penny your only option to accomplish this is by drafting an elaborate expert cannabis cultivation plan.
Ballpark Costs for Growing Marijuana
The cost for growing marijuana within the United States is around $42 per square foot. But this is the typical cost for both outdoor and indoor marijuana cultivation.
To further break it down to a more basic level, the cost of cultivating marijuana indoors is approximately 75 cents per square foot.
Outdoor marijuana cultivation is estimated that the cost will be approximately $10 to $17 per square foot. Similarly, greenhouses and hybrid plants are priced at an average of $50 per square foot.
Below are additional factors that influence the cost of cultivating marijuana.
Commercial cultivation is different from growing just a few plants in your backyard or in your basement. If you intend to cultivate marijuana for mass consumption then you’ll need to be thinking about a bigger scale. That means considering storage facilities for indoor cultivation as well as vast plots of land to grow outdoor.
The idea of starting an indoor plant is the most costly option. The cost of an indoor grow space varies widely from location to location, and there’s no simple method to quantify the cost. Prices can range from just $2.00 for a square foot and go all up to $20-$100 per square foot for top locations.
In the case of growing your plants outdoors, you can reduce the cost of starting and operating since you don’t have to invest a lot in lighting or HVAC systems. For outdoor sites, the average cost of land is $10 to $17 per square foot but in some areas, the price could be much higher.
They are difficult to establish since some greenhouses are constructed or you’re simply leasing a piece of land and building an indoor greenhouse on it. Also, the initial price of the area will be comparable to outdoors, in addition to the cost of the size of the greenhouse.
The price for the 2400W LED grow light that covers 6×6.5ft and can range between $250 and $350, while a 400W light that covers 2x2ft will cost approximately $200. To maximize their production cultivators usually employ a ratio of one plant per 250W of growing light. Therefore, use this as an estimate to figure out the costs of lighting.
Temperature Control and Ventilation
The plants require a certain environment to thrive and grow robust, which includes an ideal humidity and temperature along with air circulation, CO2. In order to create the right environment for your plants, you’ll need fans, dehumidifiers, and CO2 equipment.
The cost of blowers and fans ranges between $100 and $1,500 per unit. The number of blowers and fans needed will depend on the dimensions of the facility. Commercial dehumidifiers’ price ranges from $800 to $11,500. They’re measured based on the number of pints of water they can take out during the day.
The price of CO2 burners, tanks, and regulator kits could be anywhere from more than $600 to $2,000.
Seeds or Clones
Apart from the prices that were mentioned earlier, you’ll be required to purchase seeds or Clones. The variety of seeds can cost between $10 to $20, while the price of clones can range between $10 and $30. Clones of exceptional quality could easily cost in the hundreds, however.
If you are planning to plant in soil or establish an aquaponic system you must determine the most suitable medium to meet your needs. Costs are heavily influenced by the cultivation strategy.
If you are using soil, a 10-gallon smart pot needs 1.34 cubic feet. The 1.5 cubic foot. container filled with Roots Organic Soil costs $15. Therefore, if you’re planning to plant 100 plants in 10-gallon pots, it is necessary to set aside at least $1500 for soil and approximately $10 for a 10-gallon smart pot.
The cost will depend on the type of system used and the dimensions of the space to grow. It is recommended to conduct further investigation before diving too deeply because costs can range from $1000 for a modest indoor system, up and up to $200,000 for an indoor farm setup.
While the price of the nutrients is contingent on the cultivation strategy and your desired harvest, you can anticipate spending $1000 or more for the nutrients you require for each harvest.
The cost of electricity used for indoor marijuana cultivation and the expense of water to be used for the cultivation of marijuana in outdoor or indoor settings are often very high and are some of the most expensive costs that most cultivation facilities face in reality.
These figures are completely dependent on the utilities local to the charges of the area the location where your business will be situated. This is why having a cannabis business strategy designed specifically for your company and its location is crucial since there’s no standard cost for this.
Licensing & Legal
Many new cultivators do not think about the legal and licensing costs involved in starting their own marijuana-growing facility. It is therefore essential to add this to your budget plans.
The costs for this vary greatly based upon the region you’re located in which is why you need to understand and be aware of your local regulations and laws that apply to your area. For instance that in Colorado the marijuana cultivation license costs $4,000 and in California the annual charges for the “medium indoor” grow average $78,000.
Sample Commercial Growing Facility Costs Breakdown
The cost for the establishment of a grow facility is contingent on a variety of factors, including the size of the space you want to grow in and the type of medium you choose, as well as numerous other aspects. That’s why having the growing business program is crucial to be done in the beginning stages, because you may be in the wrong place with your estimations, and then find yourself having to find a way to raise money while you could have avoided this dilemma completely.
Below is a sample start-up cost breakdown for a warehouse that covers 7,700 square feet. cultivate for 1,000 plants which are estimated to yield 350lbs. and 4 harvests per year:
- Rent for warehouses $50,000
- Improvements and build-out Cost: $60,000
- Growing equipment 150,000 dollars
- Lighting: $120,000
- Alarm system and security Alarm and security system.
- License and legal fees Legal fees and licensing: $55,000
- Direct costs prior to profit Costs of direct costs before profit
- Administrative expenses: $50,000
- Additional expenses, such as salary costs for example: $100,000
As you will see, the expenses of the beginning of a recreational or medical marijuana cultivation company can be significant and be out of control when you’re not careful about all the necessary steps to get running. We hope that this post was useful.
If you’re thinking of beginning a cannabis-growing business but aren’t sure what to do next take a look at the Starter Kit to get a clear picture of all the information you need to be aware of and accomplish, including all the expenses required to help make your dream business become a reality.