Work your way back through the food chain of cannabis production – from shelf to seed, so to speak – and eventually you come to the breeders. Like rock star fashion designers, cannabis breeders perform irreplaceable functions in the industry, as both gatekeepers of genetics and engineers of what’s to come. It’s an activity the best ones seem born to do, with many taking to it at a young age and following it through to wherever it leads them. By all accounts, the best commercial cannabis breeders require an apprenticeship of many years, after which the sky is the limit. Such is the trajectory for Nathaniel Pennington, the multifaceted founder and CEO of Humboldt Seed Company.
Pennington first alighted in Northern California as a refugee from back East and a relationship that hit the
A scientist as well as a breeder, there always was a dual track of scientific research with seed production somewhere in the mix. “I did environmental work, but I also bred cannabis actively and had this company for almost for 25 years.” he said. “Of course, it would have been stupid for me to be outward about it back then; I would have ended up in jail or prison. Back then, I was program coordinator for a salmon research group that focused on Northern California salmon populations. I thought a genomic study would prove my hypothesis that this certain type of salmon should be listed as an endangered species, and that that would in turn trigger changes in the way things are managed, the way the rivers and forests are managed, and even the ocean. I started the study, and those papers, which went through years of peer review before publication, were published in Science Magazine. I also initiated and researched a study on salmon bones that was published in the Proceedings of the National Academy of Sciences, an equally prestigious scientific journal.”
It took many years, but his research finally triggered significant change. “It was in 2006 that I initially got the grant to do all that research, and about two weeks ago, the Spring salmon of the Klamath Basin was finally listed as a permanently endangered species,” he said proudly. “So, essentially, over the course of 15 years we got one of our most important salmon runs locally protected under the Endangered Species Act through genomic research. Those are the kinds of projects that interest the heck out of me and are what make me tick every day.”
In fact, little seems to separate the scientist from the cannabis breeder who envisioned, founded, and built Humboldt Seed Company into its current role as a leading provider of seeds and plants to every stratum of today’s cannabis industry. Passion and intellectual curiosity rather than self-interest seem to drive both activities. “I personally feel like what we do helps the planet, whether some staunch enviros out there might disagree,” he said. “I think, especially on the homegrown side of what we do, the fact that people are getting out into their backyards, or even if it is a little indoor LED grow tent, it’s still getting people back in touch with nature. And our little tagline that we use when we talk about that is that cannabis is a garden gateway plant, and it even gets young kids, by which I mean 30-somethings or 20-somethings, into gardening. I feel like that’s something that we do that can help us reconnect with the planet as a society and understand how important the function of our ecosystems is.
“I literally started this company because I liked making cannabis seeds,” he added. “A bunch of people would come to my house every winter, and they wanted to give me money but I never took it until a girlfriend at the time said, ‘Dude, people keep bringing you beer, and you’re just getting wasted. Can you please take some fucking money?’ So, that was it, but at the end of the day, our peers and colleagues here know that we’ve just happened upon this unique role.”
That said, Pennington’s inner-businessman also found its voice as new opportunities presented themselves. Recent moves reveal a company expanding its global influence and solidifying its position as a leader in the field of cannabis seed production:
Seed breeding and production in Jamaica, Columbia, and Canada. Recently began exporting seeds to Spain, with other European countries to follow soon. Active R&D project ongoing in South Africa. Domestic seed production and sales underway in California, Oregon, Michigan, Maine, and Oklahoma. Breeding collaboration with California’s largest Native American tribe, the Yurok, focusing on CBD seeds (feminized hemp seeds). Just released a new variety: Sugar Pine CBD. Announced world’s first organic-certified seed available to Canadian LPs and all legal markets around the world. Seed sales currently in the millions. HSC can now legally export seeds to legal markets from Canada and will continue to add states in the U.S.“We’re looking international because there are entire countries like Canada where we can play ball,” explained Pennington, “and we’re already exporting from Canada to South Africa, Spain, and several other countries. Just to be able to play in the international export of cannabis genetics world, that’s where we’re putting our technical focus, because every time we do that, we have to have phytosanitary certificates accompany each variety, we have to have import-export approval, and so just getting that practice under our belt is invaluable. And as far as I know, we’re the only company that went to Canada to make a large number of seeds and then make them available to the world.”
The company is California-based, of course. “We have two main production locations and three main locations in California, including our distribution hub, and then our big nursery, where we do most of that planting, and in Nevada County, where we access the I5 corridor to drive north and south and deliver the 200,000 plants that we delivered this year to farms in California,” said Pennington. “And those are just the plants; we’ve sold millions of seeds already this year.”
I asked if they would need more acreage to meet increasing demand. “We are already thinking about adding more seed production square footage and acreage,” he said. “We’re already over an acre of pure seed production, which doesn’t sound very big in the grand scheme of things, but we can produce one million seeds in 1000 square feet.”
Those million seeds are produced in just four months from start to harvest. “Just on production now, we’re not maximizing our space because we’re being careful about pollen contamination,” added Pennington. “So, without having any risk of pollen contamination, we’re only using our square footage maybe two times a year to produce seeds. Maybe.”
As mentioned, HSC, which does not do clones, does grow plants from seed for customers, which it then delivers to them. ‘We have a distribution center in Eureka, where we have vans that we use to deliver anywhere, but mostly we leave it up to other distributors that are going to the dispensaries every week already,” said Pennington. “Our distribution is for seeds and plants, and this year I think we sprouted about 200,000 plants for other cultivators and delivered them.
“We have seeding assembly line, and a vacuum drum seeding machine that can seed 10,000 plants an hour,” he added. “That’s when it’s really chugging along. An average delivery might be 10,000 plants to a farm, and they’re anywhere from two and four inches tall when they’re delivered in trays.”
People choose strains from a menu. “We have a brochure that describes everything they can and cannot order in that form, because we don’t condone all of our varieties,” said Pennington. “Some of the catalogs we give out to dispensaries includes strains that are almost novelty, like Trainwreck or Jack Herer, which are legacy strains you and I may have experienced in 1990 or 1980, but we don’t really recommend them for commercial cultivation because they either don’t have the THC that seems to be driving the market, or structurally they don’t grow the proper way for a commercial application.”
A True F1
A deep dive into Humboldt Seed Company’s breeding program of necessity begins with a basic tutorial by Pennington on cannabis breeding and the peculiar manner it is frequently practiced in the industry. “Amazingly enough,” he began, “there is this phenomenon that essentially shaped modern agriculture probably more than any one discovery, and that is the discovery of what is referred to as heterosis, or hybrid vigor, or what is commonly described as an F1 hybrid. And there is a pervasive misunderstanding in cannabis about what the term F1 hybrid refers to, and the reason for that is because cannabis has predominantly been propagated, at least commercially, via clone. The reasons why are obvious: you’ve got this dioecious plant that has both a male and female, and you don’t use the male for hardly anything but reproduction. So, absent the feminizing process, it’s cumbersome to discard 50 percent of your brood stock. The other reason is that breeding comes along when something is financially profitable as an [agricultural] commodity or crop. This tends to drive breeding because otherwise it’s just breeding for fun, which is great. I’m not trying to belittle the work that I and many other amazing breeders have done for the last 50 years.
“But my point,” he added, “and I do tend to be tangent and long-winded, is that when you suddenly turn a corner and it becomes a commercially viable industry, you now have a desire to create homogenous plants, homozygous with the proper alleles, or whatever terminology you want to use for uniform brood stock from seed. And I feel like one of the advantages of being Humboldt Seed Company is that we had growers in 2003 that were like, ‘Hey, we’re having people coming to us that want 20 pounds at a time, and they want them to look alike. So, we can’t keep growing your seeds – even though we love your seeds and they’re the best plants and the best weed and all that – [because] we need them to be uniform.’ That was when I first started getting the pressure, and it’s a long process to create that [uniformity].
“If you talk to any conventional ag plant breeder,” he continued, “the first thing they will tell you is that your tool chest as a breeder is what is referred to as your IBL, which just stands for inbred lines. With the phenomena I just referred to – heterosis, hybrid vigor, or an F1 hybrid seed – there are downfalls to inbreeding – you start to lose vigor and have mutation – but the upside is that you get uniformity with every seed smelling and looking the same, the cannabinoid [profile] the same. You inbreed and inbreed and inbreed until you start to have these deleterious effects, and that’s when you’ve reached a magic place in the genome. Now, when you hybridize that with something else that is also a highly inbred line, you create a true breeding F1 hybrid. So, on a seed pack you might order online or get from a dispensary, often it’ll say F1 or F2, but that is not the real nomenclature.”
Pennington believes the error is one of ignorance rather than deceit. “Most cannabis breeders don’t understand what a real F1 refers to. If you read the terminology, an F1 refers to the first crossing of two unique cultivars together. The idea is that you know they’re going to produce something amazing because you’ve tried them before, but the reality is that almost every single cannabis breeder out there is taking what’s called a poly-hybrid – which I liken to dog breeding. Mutts are some of the best dogs ever – I had a mutt that was my favorite dog of all time, smart, healthy – but whether that mutt mates with another mutt or with a purebred German shorthair, it’s going to produce a litter of mutts, and they’re going to run the gamut. It’s not breeding. Breeding is making something that’s reproducible, like a science experiment, where you’re able to do it 10 times over with the same methodology and the same ingredients and get the same results.”
HSC is getting those results, added Pennington. “One of the ways that we’re creating these incredibly highly inbred lines is the same the way all sweet corn that we eat today was created, by inbreeding two corn varieties to the point at which they were just horrible, awful, mutated plants, and then bringing them together. That concept is the core of all breeding for conventional ag, and it takes time. Often, it takes nine generations of selective inbreeding to create a true inbred line, and essentially there are very, very, very few cannabis breeders that are putting any energy into that kind of effort at all.”
The Inevitable Ubiquity of Autoflowering Cannabis Plants
The seed market on Humboldt Seed Company’s website contains four basic categories: regular feminized, auto flower, hemp, and CBD. I asked about the consistency of those categories and whether auto flowering will become ubiquitous. “I’m confident enough to say this and I think there are enough of us that are deep enough into this industry and have seen the way things have worked that they’ll understand why I’m saying this,” he began. “I think sometimes I kind of shy away from saying it because a lot of people think that it just comes from some stupidity of ours or mine, but after having a long career in science and in genetics and in plant breeding, starting with fisheries biology, ironically enough, I’ve learned that traits are not static in a genome and they don’t need to carry baggage with them.
I asked about yield and whether autos produce enough for commercial cultivators. “So, there’s something called harvest index that’s often in conventional ag,” he replied. “If you’re looking at something like broccoli, let’s say, and you’re a broccoli breeder, your harvest index is how much of the overall broccoli plant you’re growing on your farm that is the part that you’re selling at the market. So, in broccoli, it would be the head and then those little leaves that they often leave on. With cannabis, the worst harvest index you can have often comes from the bigger, taller plants, because you’ve put on all this mass underneath the plant that is just stem and leaf, and it’s doing you no good in the marketplace. The best harvest index would often come from an autoflower, because you’re raising your efficiency, you’re getting more dense bud because you’re able to flower and photosynthesize for 20 to 23 hours a day. And if you’re doing it outdoors, it’s the same, you would have 18 hours a day, but you’re still making much more efficient plants.”
What about terpene and resin production in autoflowers, all the good things that put the concierge in cannabis. “So, that’s the thing,” responded Pennington. “It’s been amazing since we undertook the process of turning photoperiod-type plants, which is what we’re used to – plants that are the opposite of autoflowering plants, that flower when the fall comes, and are what cannabis growers, especially in the United States, have been used to growing forever. Those photoperiod plants are where our common sort of hyped-up strains have tended to come from, and that’s fine, with some of our most popular varieties – Vanilla Frosting, Blueberry Muffin, Caramel Cream, plus some new things – and it’s taken us about five generations on average to turn them into autoflowers, and we’re not seeing any baggage, nothing deleterious from the autoflowers, and it’s more and more so, because the more we breed within autoflower and the more that we create autoflower that is similar to conventional popular cannabis types, the easier it is to move something from [one category to the other]. If our Vanilla Frosting is popular, and one of our new strains, say the Humboldt Pound Cake, is crossed, you save time now that you’ve already got some of your stock into the autoflower subspecies. It’s just much easier to then be creative within the subspecies.”
Another benefit is that the autoflower does not seem to have anywhere near the propensity to hermaphrodite. “Our studies are now showing that between 80 to 90 percent of the time, when you have hermaphrodite issues, it’s related to the change in life cycle, because often it’s done artificially,” he said.
Thus far, added Pennington, all the work is paying off. “We have gotten kind of a reputation of being the seed company that
makes the most consistent seeds,” he said. “If we say they’re a Blueberry Muffin, every single one of them smells just like a blueberry muffin and you’re not dealing with something that you can’t sell as that. You’re not getting something that you have to have multiple lab tests done on. Certain strains of ours are better in that regard than others, but in general that’s one of the reasons why we’ve become popular. And fortunately, that works well for the backyard grower, because if you buy a pack of seeds and it’s called Banana Mango, and it smells like a diesel, it’s not what you wanted. You may still be happy, but if you’re a commercial cultivator and you buy seeds, and every single plant is a whole different animal, it’s going to be a nightmare.”
The breakdown of sales and revenue is interesting, as well. “I’m going to make an educated guess that we’re selling 85 to 90 percent of our seeds to farms, to commercial cultivators,” he said. But we’re making only around 60 percent of our income from commercial cultivators, if that makes any sense, because we make so much more money in over-the-counter sales in stores, where the margins are much higher.”
Trends & Traits
Pennington’s view of the industry is both pragmatic and holistic, steeped in the community he comes out of and responsive to the realities of business. I asked him about the prospect of other MSOs starting or acquiring breeding programs, which they are, and whether Monsanto getting in the game worries him. “We do think about Monsanto, because right now – and I think this is so ironic – I’m hearing from some people who know us and love us, but they are also, like, ‘You guys have grown and been so successful as seed breeders that you’re just overly dominating right now.’ So, we’ll get that occasionally, like we’re Monsanto! It’s from a small group of people and we are always able to squash it quickly, and they usually apologize, but we have gotten big.”
Regarding other MSOs, Pennington sees more opportunity than threat. “If they’re breeding, they’re breeding to discover clonally propagated phenotypes, and we have no problem with that,” he said. “In fact, we started releasing specific seed lines that are conducive to finding variety in the seed line, because some cultivators want to find something and then they want to stamp their name on it, and do they want to go through the huge hassle of having pollen in their facility? Do they want to go through the hassle of having to do a phenotype, which is incredibly wasteful and inefficient? And then do they want to market and brand their own strain? It’s possible that some do, and we want to foster that because we have done this so many times, and we have a capacity and skill set that takes years and years of looking at plants and consuming cannabis to master. I mean, not even necessarily all the consumption, but smelling and looking and seeing the signs before you have the entire effort of throwing something out completely.
“So, really,” he added, “the answer is that they’re not competing with us at all, because for one, when I went down to the Humboldt County Courthouse in early 2000, and asked if anybody in the state or anywhere else had the name Humboldt Seed Company, and they said no, the reason I did that was because I wanted to start a cannabis seed company, not a cannabis clone company, and not a cannabis genetics company. Even though we use marker assisted breeding and genomics in our breeding process, the difference between a cannabis seed company and a cannabis genetics company is that a cannabis genetics company creates something that is then propagated clonally most often, whereas a cannabis seed company creates something that can only be propagated by the seed company and its affiliates. The phenomenon of F1 hybrid seeds is why Monsanto and Syngenta are some of the planet’s most successful and scary businesses, because when you have these incredibly powerful genetic tools at your fingertips, you can charge whatever you want, because it’s worth it. The farms know [the value] for them to have this incredible crop of soybeans that is disease and pest free.
“But don’t get me wrong,” he added. “I’m not a big GMO guy.”
Another deteriorating situation in the California market is the decline of wholesale flower prices, something that happens seasonally but this year has taken on a special foreboding as new grows come online mostly from greenhouses in the state’s vast agricultural center. One result of the ensuing oversupply is that small-batch growers who hold back flower to fill the gaps in supply during normally underproducing months are unable to sell their crop at anything close to what they used to get. “What’s bad for cannabis producers is often good for us, and it’s been a struggle for us here in Humboldt,” uttered Pennington with typical honesty. “I try to be forthcoming with everyone, but people will come into the office for what we call our genetic consultation meeting – for anywhere between 1000 to 10,000, 20,000, or 30,000 seeds that they’re buying at once – and we always end up discussing the market, and it always goes back to the same thing where there’s an impending flood in general of cannabis. Because for many, many years, it was, like, well, there’s this bottomless hole that OG Kush can fill. And we do have this amazing OG Kush seed line now that’s got the inbred lines on both sides, and we’ve made a hybrid and everything. It’s perfect, and it’s not really hurting us, but for once, this year we’re barely going to sell out of OG Kush.”
It’s a trend he apparently saw coming. “I’ve been telling the small mom-and-pops and the legacy farms of Northern California, and California in general, that we’ve had kind of a respite from what people have been very scared of for the last five years, which is corporate cannabis, the big, bottomless pits of money, coming in and dominating,” he said. “I’ve been telling people, okay, we could have expected what happened to happen. Basically, there were a lot of big companies that came in and bought huge facilities and tried to scale up ahead of knowing their trade well enough to really be able to scale, and yes, they lost a lot of money. But are they finished? No. And they’re learning fast. I mean, I hate to say it, but they are some of our biggest customers, and they keep buying more and more seeds. In a way, it’s a terrible position, because we’re here in the heart of this heritage cannabis place.”
I asked if he thought the two worlds could come together, to prevent losing the knowledge base, the genetics, the soil that in many cases has been worked and tended with care for generations?
“I think sometimes it’s a little hard for the people here in Humboldt to let go of this vision that they’ve had of having this homestead slash business, and having the farmers market, and going down to town once a week to sell their wares,” he said. “I think that they’ve started to realize that that’s just not reality, because here we are in Humboldt and there’s weed everywhere. Someday we may have a weed farmer’s market, and it may be enough for a few farms to survive, but even the organic vegetable farmers that are around our farm here have to figure something else out to make it.
“I think the good news is that every single one of those experienced cultivators, whether they’ve been cultivating in Northern California or Oregon for only five years, or whether they’ve been doing it for 20, all of those people are needed in order to have the functioning cannabis industry that the United States wants,” he continued. “It’s clear that the U.S. wants cannabis to be legal, they want there to be cannabis commerce, they want there to be tax dollars, and a certain group of people want it to be done in a way that is socially just and undoes some of the wrongs that have been done. But there’s a place for every single one of those people in this industry, because there is no way to train such a huge workforce. I’m still learning something new every single day that I interact with this plant. I discover something new about how to cultivate and how to breed and the nuances of its genetic diversity, and I’m someone who is 43 years old and has spent literally all his adult life [around cannabis]. I consider myself an expert and I learn something new every damn day, so I think if people can open their mind a little bit and maybe not have such an attachment to their own vision of what their future in cannabis is. And I don’t think consolidation is a bad thing. I mean, it’ll suck if cannabis becomes amazon.com and that’s the only way you can get it, and I don’t want to see that, but there is no way that 100,000 individual cannabis farms are going to be able to thrive equally in California.”
As dire as that sounds, one avenue for Humboldt writ large involves propagating the county’s legendary status via seed. “Cannabis is special because people care so much about it, and one of the things that I’ve been trying to develop is, if we can’t always have weed from Humboldt because it’s not going to produce enough weed the way Napa produces wine, what’s wrong with seeds from Humboldt,” asked Pennington. “I think doing weed from Humboldt is a service in a way, because it’s keeping the Humboldt name on the tongues of people all over the world. I started getting concerned when I would talk with younger folks on the East Coast, and they’d be like, what is Humboldt? And I was like, wait a second, when I grew up in New York and Philadelphia, we knew what Humboldt was. We knew it was where the good stuff came from, so we have the capacity now in a unique way to be able to keep that somewhat synonymous.”
And the optimist in Pennington still sees an opportunity to create a new sort of agricultural industry. “I’ve been saying over and over to the regenerative agricultural folks that want their cannabis made in a sustainable agricultural way that we have an opportunity with this new agricultural industry that is obviously going to be huge and robust to craft it culturally to avoid the mistakes we made in conventional ag. Most of the huge developments in agriculture have happened since the cotton gin and the invention of big industrial agriculture, and for the entire time that we’ve been making those mistakes – the overuse of herbicides and chemical fertilizers, the destruction of topsoil – cannabis has been illegal. So, if we can craft this industry in a way that we really look at the mistakes we’ve made, we have the capability of avoiding many of the problems we’ve created with the way that we let big ag develop.”
Seeding the Future
As Humboldt Seed Company expands, is it acquiring or looking to be acquired, and what about going public one day? “That was something that I thought for a while,” said Pennington. “Maybe we team up with a failing Canadian dot com group that has a place on the stock exchange up there. But then we started making a bunch of money, and I said, wait a second, what do I need that for? I don’t necessarily think we aren’t going to need it eventually, but I want to see how federal legalization rolls out first. The biggest question in this industry right now is whether there is going to be interstate commerce or not. If federal legalization comes out and there is interstate commerce, then we may keep distribution hubs in the places where we’ve already had them set up, but our breeding and R&D may suck completely back into California, and obviously we’ll keep our hub here in Humboldt, but centered around UC Davis.” UC Davis is one of the world’s leading universities for agricultural research and development.”
As for buying or being bought, the answer to each was a qualified yes. “We are acquiring,” said Pennington. “We’re thinking about it, and unfortunately there are already some very stressed operations in Humboldt. A lot of folks are thinking about selling and going to Oklahoma, and to be honest, we almost traded a crop worth of seeds in Oklahoma for a good portion of a down payment on 30 acres with a license on it in Humboldt.” The company also is considering buying a farm in New York. “I was born in New York, and it’s always been a dream of mine,” explained Pennington. Or Humboldt Seed Company could be bought. “We are acquirable, but it’s got to be strategic. It would have to be a working relationship, because I don’t think anybody wants to acquire us without… I mean, it’d be hard to have the magic that we’ve been doing without our core team members.”
That team includes Ben Lind (Chief Science Officer), Halle Pennington (Products Executive), Al Storey (Office and Accounts Manager), Jasmine Salisbury (Logistics Manager), and Hannah Tweedy (Customer Service Manager). In addition to a staff that numbers about 30 in California and over 100 across the board, the company projects 2021 revenues of approximately $4 million, half retail, half wholesale.
It’s still very much a family business, said Pennington, at least for the time being. “We’ve been trying to stick with elevating people’s job titles from within, but I don’t think we’re going to be able to promote from within for certain tasks, and I do think we’re going to have to start making some big hires. I think we’re going to need to get a good Board, as well, and have someone to help make some of these decisions that are too hard for me to make.
“As far as protecting us legally and financially, I have handed some of that off, which has been a dream come true,” he said. “When I was working with a CPA and he would tell me I needed to give him this and that, I’d be like, I don’t necessarily have all that information. Three years ago, I was losing lots of sleep, but I feel like we’ve caught up and we’re getting to a point where we’re an open book and ready for an audit.” He paused before adding, “I don’t think they’re going to be targeting a seed company in Humboldt County.”
Asked if the future of cannabis genetics rests in the hands of people like him, Pennington replied softly, “I would say so,” and added, “Earlier I touched on why we spend so much time, energy and money developing autoflower genetics, and it’s because it’s just a fact that they are more efficient plants to grow than their photo-sensitive counterparts. I’m focused on them because I can’t believe how fast they grow and how efficient they are and how equivalent the bud is to the other one, and the beauty of them for a seed company is that the only way to propagate them is by seed. When the autoflower revolution really takes hold, [it will be difficult for] many of these people building out million-dollar facilities with these automated blackouts on tracks and these giant cables that drag black fabric across the top of the greenhouse for 12 hours a day. Mixed-light facilities are some of the most efficient ones out there, but I do think that sooner or later people are going to think about where their cannabis comes from, and how much of an impact it has on the environment, because as we keep burning up and setting records, people are going to get frustrated and want change.”
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