- Cannabis cultivation plagued by legal peril and price volatility
- Demand for non-psychotropic cannabinoids is growing rapidly
- GHG hemp cultivation projects now underway in the U.S. and Canada
In California, Oregon, and Washington State, cannabis farmers (growing mainly for THC content) are now suffering from the unwelcome truth in economics – prices of almost everything seesaw perennially. In the case of cannabis, wholesale prices have entered a freefall, motivating farmers to cultivate hemp for CBD extraction in place of cannabis. As a result, Global Hemp Group, Inc. (CSE: GHG) (FRANKFURT: GHG) (OTC: GBHPF) and are teaming up to grow CBD-rich hemp in Oregon. Demand for CBD and other cannabinoids is increasing as their application in health-enhancing products gains steam.
The oversupply problem is particularly acute in Oregon. Three years after the legalization of recreational marijuana, the state is buried under a mountain of weed. In February, Oregon State records showed 1.1 million pounds of cannabis flower had been registered. That’s about three times annual consumption. In 2017, ‘Oregonians smoked, vaped or otherwise consumed just under 340,000 pounds of legal bud’, according to one report.
Despite this surplus, output is expected to climb as more growers are licensed. By April 1, the Oregon Liquor Control Commission (OLCC) had issued 963 licenses to recreational cannabis growers, with another 910 applications pending. The OLCC says it cannot legally put a limit on the number of licenses it issues; if an applicant qualifies, withholding a license would constitute a violation of due process. Naturally, the excess supply has resulted in much, much lower revenues for producers, who are switching from growing cannabis for its THC content to hemp for CBD.
CBD is turning out to be not only a best seller in consumer markets but also a bonus crop for farmers, who can earn more than $100,000 an acre growing hemp plants to produce it, according to the Associated Press. A number like that makes the joint venture between Global Hemp Group and Marijuana Company of America look decidedly attractive. In May, the two companies acquired a 109-acre agricultural property in the fertile Willamette Valley approximately 70 miles south of Portland, Oregon, to grow CBD-rich hemp.
The project includes five greenhouses with a canopy extending to nearly 20,000 square feet. This marks the second collaboration between Global Hemp Group and Marijuana Company of America. The two companies are also working together on an industrial hemp project in New Brunswick, Canada. Results of the 2017 season there were encouraging, and the partners are now planting 125 acres of hemp for 2018. Over the following three years, grow area is planned to rise to 1,000 acres.
Recently, the partners provided an update on the New Brunswick project, announcing that Joan Parker-Duivenvoorden has joined the enterprise as project agrologist and field manager. Parker-Duivenvoorden, a graduate of Guelph University, earned a BSc (Agr) majoring in plant protection in 1981. She has garnered over 15 years’ experience with the Nova Scotia Dept. of Agriculture and with the New Brunswick Soil and Crop Improvement Association (NBSCIA).
As legal perils and economic vicissitudes continue to plague the cannabis industry, hemp cultivated to produce CBD is looking good to grow. This is exactly what Global Hemp Group plans to do. The company is executing a multi-phased strategy to build a strong presence in the industrial hemp industry in Canada and the United States. The first phase of this strategy, already underway, is hemp cultivation to extract cannabinoids (CBD, CBG, CBN and CBC). This is expected to create a short-term revenue stream that will allow the company to expand and develop successive phases of the strategy. The second phase of the plan will focus on the development of value-added industrial products utilizing the processing of the whole hemp plant, as envisioned in the company’s Hemp Agro-Industrial Zone (HAIZ) strategy.
For more information, visit the company’s website at www.GlobalHempGroup.com