hemp Archives - Green Market Report

StaffOctober 5, 2022
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5min9410

The Daily Hit is a recap of cannabis business news for October 5, 2022.

ON THE SITE

NBA Legend Isiah Thomas Hopes To Score In His International Hemp Venture

One World Products (OTCQB: OWPC), a fully-licensed hemp and cannabis producer in Colombia — owned by former Detroit Pistons point guard Isiah Thomas — is one step closer to commercialization. The news comes as OWP recently found $10 million in financing to help scale industrial hemp operations and work its way into the capital markets by 2023. Thomas has previously said that he wants the auto industry to trade plastic for hemp. Read more here.

DEA Licensed BRC Raises $20 Million

An active Drug Enforcement Administration (DEA) pharmaceutical cannabis license holder, Biopharmaceutical Research Company completed a $20 million Series A fundraise. BRC said the raise will help it aggressively scale its operations and increase its product offering, conduct sponsored research, and execute its go-to-market strategy. Read more here.

Nevada Cannabis Sales Drop For Fiscal 2022

The Nevada Cannabis Compliance Board (CCB) and the Nevada Department of Taxation (DoT) released figures showing more than $965 million in taxable sales reported by Nevada’s legal cannabis industry over a 12-month period. Read more here.

Croptober Not Feeling So Celebratory

National cannabis wholesale prices continued their multi-month plunge at the end of September, likely not a good sign for outdoor marijuana farmers heading into harvest season known in the industry as ‘Croptober’. According to Cannabis Benchmarks, for the week that ended Sept. 30, the company’s spot index decreased 2.2% down to $966 per pound of cannabis flower, down from over $1,050 per pound two months ago. Read more here.

The Marriage Of Herbal Nutriceuticals and Psychedelics

Nutraceuticals have been getting a bad health and wellness rap for years. Most of the chatter is about them not being “real”; doctors ignore them in part because they have not gone through any FDA-approved clinical trials—even as their patients rave about the health benefits they get from taking them. Now there’s a movement to team up nutraceuticals with psychedelics and apply the science developed around psychedelics to advance nutraceuticals as more credible health and wellness products. Read more here.

IN OTHER NEWS

Curaleaf Holdings, Inc., Tryke Companies

Curaleaf Holdings, Inc. (CSE: CURA) (OTCQX: CURLF), an international provider of consumer products in cannabis, today announced the completion of its previously announced acquisition of Tryke Companies (dba as Reef Dispensaries), a privately held vertically integrated, multi-state cannabis operator. With the close of the transaction, Curaleaf’s national footprint has reached 29 cultivation sites and 144 dispensaries nationwide. Read more here.

atai Life Sciences N.V.

atai Life Sciences N.V. (Nasdaq: ATAI), which is developing VLS-01, a form of N,N-dimethyltryptamine (DMT) for the treatment of treatment-resistant depression (TRD), announced today the dosing of the first subject in their Phase 1 SAD trial of VLS-01. Read more here.

Zylorion Health Inc.

Zylorion Health Inc., a precision mental health care and psychedelic therapy focused company, today announced the filing of a composition of matter patent with the United States Patent and Trademark Office for the company’s novel second-generation lead psychedelic compound. Read more here.


Adam JacksonAugust 15, 2022
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4min2891

CV Sciences, Inc. (OTCQB: CVSI) sales fell in the quarter as demand for hemp-derived products continues to fade. The hemp operator announced its financial results for the quarter ending June 30, 2022.

CV Sciences delivered approximately $4.1 million in total revenue during the period, a loss of 19% versus the same period last year —  missing the Yahoo Finance Average analyst estimate for revenues of $4.88 million.

The company said that the decline is primarily due to lower sales in the retail channel. The total number of units sold during the second quarter also decreased 5% compared to the same time last year. Other reasons for the decline included higher discounts for new product placements and changes in our sales mix to lower priced products.

CV Sciences also reported a second-quarter net loss of $2.7 million versus a $3 million loss sequentially; and a net loss of $3.5 million in the same period last year. The earnings were for a loss of two cents per share, versus a loss of three cents per share in the previous quarter.

“Second quarter results met our expectations and we are encouraged by improvements in the retail channel and very positive consumer response to several new product launches,” said CEO Joseph Dowling.

CV Sciences posted a gross margin of 30.7% for the second quarter versus 44.7% for the second quarter last year.

The operating loss fell to $2.3 million in the second quarter of 2022 versus an operating loss of $3.5 million in the second quarter of last year — mostly due to reductions in its selling, general and administrative expenses. The company posted an adjusted EBITDA loss of $1.8 million versus an adjusted EBITDA loss of $2.4 million in the second quarter last year. Last quarter’s figure was $2.5 million.

The company said it had a total cash balance of $1.1 million at quarter end, versus $1.4 million at year-end.

Despite the revenue loss, CV Sciences reiterated its position as a top-selling hemp extract brand in the natural product retail sales channel, according to SPINS scan data.

The company said it will continue to evaluate strategic review of its business, “including consideration of inbound and outbound merger, sale, acquisition or other options for the Company as a whole or for any business segments.”

“Our new OTC products, along with our Reserve Collection and Wellness Line of products are evidence of our strong pipeline, and demonstrate our ability to develop innovative products that address the need states of our consumers,” Dowling said. “Our flagship PlusCBD brand continues to gain market share in the natural product channel, and, with our portfolio of high-quality, proven products, and favorable regulatory momentum, we believe the Company is positioned for future growth.”


Adam JacksonAugust 1, 2022
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9min2790

Lawmakers in Washington D.C. heard testimonies from a slate of hemp advocates and stakeholders in the industry looking to provide input on the commercial production and processing of the crop.

The hearing, titled, “An Examination of the USDA Hemp Production Program” was held last Thursday by the Subcommittee on Biotechnology, Horticulture, and Research (Committee on Agriculture).

In her opening statement, Chair Stacey Plaskett (D-USVI) said that while markets for hemp products such as fiber, grain and flower are developing, “they are still volatile and uncertain.”

“To support farmers and producers in the ongoing development of this emerging sector, it’s crucial that USDA continue to work to support and expand hemp production and the hemp industry,” she said, adding “As we look towards the next Farm Bill, we can continue to address ongoing issues and provide our farmers, producers, processors and agricultural researchers with the resources they need.”

USDA, FDA Absent

Members of the committee including Jim Baird (R-IN) as well as Rep. Glenn Thompson (R-PA) noted the absence of U.S. Department of Agriculture (USDA) and Food and Drug Administration (FDA) representatives at the hearing, considering the central role the agencies play in hemp regulation.

Kate Greenberg, Commissioner Colorado Department of Agriculture (CDA) said in her remarks that the 2018 Farm Bill burdens hemp producers with high sampling and testing fees, required background checks, and FSA acreage reporting, “which is duplicative in nature because it is already reported to the USDA through state reporting.”

“Hemp has the potential to create new economic opportunities for farmers who are dealing with a changing climate and increasingly arid land,” she said. “Our young farmers and ranchers are constantly seeking new ways to support their bottom line and the environment at the same time. The hemp industry has the potential to advance CDA’s priorities if we listen to our producers and implement sensible regulations.”

Ryan Quarles, Kentucky Department of Agriculture Commissioner (KDA) said that acreage for the crop has fallen since the 2020 growing season because supply has outpaced demand. He also added that the Drug Enforcement Administration (DEA) should not have to play a role in testing and that the THC limit for hemp plants should sit at one percent instead of the current 0.3%.

Marijuana Moment previously reported that House Appropriations Committee leaders released spending legislation asking the USDA to create further guidance on hemp. The legislation also recommended that the USDA coordinate with the DEA and figure out how to manage concerns about enforcement actions for hemp that exceeds the 0.3% THC limit.

At the same time, “it would be appropriate for the new one percent limit to include not only Delta-9 THC, but every other THC isomer which could have an intoxicating effect on consumers,” Quarles said, such as synthetically created Delta-8, Delta-10, Delta-7, HHC, and others.

Consumer products should require a separate legal standard focusing on quantities, he added, not percent concentration by weight.

“Embracing a “total THC” standard instead of a “Delta-9 THC only” standard will establish a threshold which better reflects the material’s true intoxicating potential,” he said. “Congress should consider adopting a separate definition for consumer-ready hemp products. The current law’s definition is focused on the chemical compounds within the hemp plant at the time of its harvest in the field or greenhouse; it is not a useful yardstick for measuring the intoxicating potential of consumer products that are intended for human consumption such as gummies, liquids, vapes, or “smokeables.”

Eric Wang, CEO of Ecofibre who testified on behalf of the U.S. Hemp Roundtable, agreed with the sentiment.

“Bad actors are selling products without appropriate safeguards and misleading consumers with false label claims,” he said. “Further, some struggling farmers and businesses have pivoted to market intoxicating products such as Delta-8 THC, prompting FDA and CDC warnings that they pose significant consumer health and safety risks, particularly for minors.”

CBD Rules

In Wang’s testimony, he expressed that “a clear regulatory pathway for CBD would not only relieve the economic pressure that is leading to this product shift, but would also help ensure products do not contain intoxicating hemp ingredients.”

Industry interests reflect a range of national and regional groups with varied priorities, many times depending on the products they produce and whether the hemp is used for its fiber, grain, or flower.

The Congressional Research Service (CRS) said in a March report that some shared priorities call for relaxing USDA’s regulatory standards, “which are perceived by the hemp industry and some state regulators to be overly restrictive and impractical,” as well as removing the role of the DEA in hemp regulation.

The report also recommended that Congress address industry concerns about the lack of FDA regulations for hemp-derived CBD products in the food supply chain, which it said could become a public safety threat.

“An open question is whether changes to FDA laws and regulations are within the farm bill’s jurisdiction,” the report said.

In a May hearing, FDA Commissioner Robert Califf lamented agency action on CBD and expressed his interest in developing a regulatory path despite the FDA’s limited authorities under current law.

“I don’t think the current authorities we have on the food side or the drug side necessarily give us what we need to have to get the right pathways forward,” Califf told lawmakers. “We’re going to have to come up with something new. I’m very committed to doing that.”

Marcus Grignon, a tribal spokesman and executive director of Hempstead Project Heart, also made recommendations to the panel such as separating the definition and regulation of industrial hemp from cannabinoid or floral hemp, which he says are “easily differentiated with a visual inspection,” and removing the testing and background requirements for hemp grain and fiber producers.

Hemp operations need to be able to interact with banks and insurance companies more freely, he said, as it is difficult to source a bank that will take business accounts connected to hemp production and processing. The sobering lull of federal legalization has deflated industry optimism of companies engaging with banks and credit card companies soon.

He added that the USDA should issue stamps of approval for hemp being shipped between the various jurisdictions in the United States to help mitigate issues related to interstate commerce.

“While these suggestions do not cover all the needed changes, these top three will enhance the American hemp industry, ease burdensome regulations for farmers and create more demand for hemp-made materials,” he said.


Adam JacksonJuly 29, 2022
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7min3151

A team of Missouri researchers have figured out a way to distinguish Delta-8 from Delta-9 using common drug testing methods.

The new discovery comes as testing companies have faced challenges isolating the semi-legal Delta-8 from its chemical cousin Delta-9 – the primary psychoactive ingredient in cannabis – in both presumptive and definitive urine drug tests. The findings were presented by its author Dr. Uttam Garg of Children’s Mercy, Kansas City and researchers at the Missouri-Kansas City School of Medicine during the 2022 AACC Annual Scientific Meeting & Clinical Lab Expo in Chicago this past weekend.

“With our methods, we can detect both Delta-8 and Delta-9 isomers and distinguish Delta-9 from Delta-8,” said the paper’s author, Dr. Uttam Garg of Children’s Mercy, Kansas City. “If someone is using Delta-8-THC, the immunoassay we are using and likely other immunoassays which are out on the market will detect it. Once an immunoassay positive sample has been identified, then you need a chromatographic method to separate Delta-8 and Delta-9 because they are very similar structurally. That’s what we did in our lab—we used immunoassay for initial screening and GC-MS to separate and distinguish the two compounds.”

Gas chromatography-mass spectrometry (GC-MS) is an instrumental technique typically used for fast molecular analysis in forensics, environmental monitoring, drug testing of athletes and other applications.

Delta-8 gained more popularity in the U.S. over the past few years after the 2018 federal Farm Bill made it legal to grow hemp. The Farm Bill specifically defined THC as Delta-9, which left Delta-8 out, sparking a grey market of Delta-8 products. Hemp contains large amounts of cannabidiol (CBD), and CBD can be chemically converted into Delta-8, Quest Diagnostics Medical Science (NYSE: DGX) Liaison Jack Kain said in a company blog post last year, “and in recent years, it has grown in production and selling as medicinal or recreational cannabis products.”

Delta-8 is known for giving consumers a milder high than regular pot, but because Delta-8 products are unregulated, researchers have found that many contain toxic manufacturing by-products that make it more dangerous than Delta-9-THC.

“In light of this, testing for Delta-8 is needed to discourage people from taking these contaminated products as a way to circumvent drug tests,” the release said. “Testing is also needed to monitor the spread of Delta-8 and to inform public health efforts to craft better regulations for it.”

Hemp Market

The market seems to be cratering for Delta-8.

Hemp Benchmarks said rates are beginning to slide, with Delta-8 prices falling each month for the past year — down 6% since May to an average tag of $542 a kilogram in June. This represents a 55% drop since the same time last year. Reported deals ranged from $370 to $725 per kilogram, according to the latest benchmark.

Delta-8 THC is illegal in 14 states. Oregon this month banned the sale of synthetic cannabinoids at general retailers – the first state to do so.

Regulators at the Oregon Liquor and Cannabis Commission (OLCC) said that any store without a special license cannot sell Delta-8 products on the open market effective July 1 over concerns about the chemicals used to make artificially derived cannabinoids.

“The supply of CBD was outstripping the demand for CBD,” Steven Crowley, the OLCC’s hemp and processing compliance specialist told the Oregonian. “And so, the people who had CBD on hand were looking for other ways that they could market it. People started working on different products that they could convert the CBD into. This is where you get the Delta-8 THC products.”

CBN – a hemp-derived cannabinoid – will have a one-year “grace period” before it is banned as well, the newspaper reported. The new rules will allow the sale of artificial cannabinoids only in OLC- licensed adult-use cannabis shops and after those products have undergone testing and approval from the FDA. Those who violate the law face fines up to $10,000.

In Colorado, Governor Jared Polis signed into law a measure that authorizes the state to ban the production of “intoxicating tetrahydrocannabinol isomers that originate from industrial hemp or may be synthetically derived.” The measure also establishes a 20-member task force to study those intoxicating hemp products – such as Delta-8 THC and other THC isomers manufactured from hemp-derived CBD – in order to make legislative and regulatory recommendations by early next year.


Adam JacksonJuly 26, 2022
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9min2390

Texas Agriculture Commissioner Sid Miller is calling for an expansion of the state’s current cannabis laws as a license shakedown scandal swirls within his orbit.

Last week, Miller posted an editorial on the Texas Department of Agriculture website calling for a loosening of the state’s cannabis laws. Texas has only legalized medical marijuana for a very restrictive list of conditions, but the state is also a big proponent of industrial hemp.

While Miller is calling for “expanded access to the compassionate use of cannabis products in Texas,” a political consultant and former top aide for Miller, Todd Smith, is fighting accusations – among many others – that he profited off a hemp licensing scheme.

Hemp Scandal

Smith was first arrested by state authorities in May 2021, on charges of third-degree felony theft, alleging that he leveraged his relationship with Miller and the Texas Department of Agriculture (TDA) to solicit money and campaign contributions for licenses as the state was figuring out how to regulate hemp cultivation.

In a 9-page affidavit, investigators detailed how Smith used a middle man to recruit prospective clients willing to dole out thousands of dollars in exchange for a “guarantee” that they would be first in line for the state-issued licenses.

The first known instance according to the document occurred at a social event on Aug. 18, 2019, shortly after Texas Gov. Greg Abbot signed into law House Bill 1325, which legalized hemp production.

Smith’s associate, a Texas man named Keenan Williams, approached Andre Vinson – who was operating in the CBD industry before finding interest in hemp amid state implementation – and told him that he was working directly with senior leadership at the TDA, adding that there would only be 15 exclusive state hemp licenses issued in the entire state. The going rate for just one license according to Williams at the time? $150,000.

However, there is no such cap on hemp production licenses in Texas. Each license costs $100.

“What Will Be The Cost Of A License?” on Page 5 of TDA’s Hemp FAQ Guide.

The criminal warrant chronicles at least six detailed accounts of cash handoffs and quid pro quos for exclusive access into Texas’ nascent hemp market. In another instance, Smith gave one prospect-turned-whistleblower a $25,000 invoice to conduct a survey “to help obtain and solidify the Republican votes on hemp issues.”

“Todd Smith created by words and his conduct, a false impression of fact that affected the judgment of others in the transactions to obtain a hemp license and/or conduct a survey that was never attempted by Todd Smith,” the affidavit said.

Miller Denials

Green Market Report previously reported that this apparently isn’t Smith’s first rodeo when it comes to influence peddling. In 2018, the Austin American-Statesman reported that Smith promised a San Antonio businessperson an appointment with the Department of Agriculture in exchange for a $29,000 loan. Miller and Smith’s relationship has been mutually beneficial. In 2016, Miller gave Smith’s wife a newly created assistant commissioner position, one of the highest-paying roles in the department.

Miller denied knowing anything about the allegations against Smith and Williams – even suggesting that the accusations were political fodder amid an upcoming election season – though the pending criminal case called into question by political opponents the commissioner’s own proximity to the scheme.

“That was Todd, between him and his clients,” Miller told the Texas Tribune.

Texas criminal defense attorneys Sam Bassett and Perry Minton – whom Smith hired following his arrest – said in a statement that he was “paid and performed these very duties for a number of clients interested in obtaining hemp licenses” and that Smith “never guaranteed anyone a particular outcome of any kind.”

“Todd never violated any laws and did not steal anything from anyone,” the lawyers said at the time, adding that their client “looks forward to continuing his cooperation with law enforcement and the district attorney to clear his name.”

Grand Jury Indictment

At the same time, Williams continued to cooperate with authorities following his arrest. By January 2022, a grand jury indicted Smith on felony theft charges – along with Williams – as well as commercial bribery. Miller officially cut ties with Smith the next day.

“Todd Smith and I have mutually agreed to terminate his association with my campaign effective immediately,” Miller told the Texas Tribune. “My campaign and the (TDA) will cooperate fully with any agency involved in this matter so it can be resolved openly, fairly, and judiciously.”

In the end, the scheme earned $55,000 for Smith. Williams collected $77,500.

Market Size

In 2021, Texas has issued 760 hemp licenses and permitted 3,405 outdoor acres and 10,871,664 greenhouse square feet. Texas is third in the nation for the amount of greenhouse hemp grown. According to Texas A&M Today, industrial hemp is the target for a plan from Texas A&M University researchers to 3D print new buildings using hempcrete. The project will be funded by a $3.74 million grant from the U.S. Department of Energy Advanced Research Projects Agency-Energy (ARPA-E) Harnessing Emissions into Structures Taking Inputs from the Atmosphere (HESTIA) program.

While some in Texas are working towards increasing legal hemp and medical marijuana, the conservative state also has those fighting against it. The Jurist wrote in June that the Texas Supreme Court decided to uphold a ban on the production and processing of smokable hemp, saying that it was constitutional under state law.


Julie AitchesonApril 7, 2022
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5min2912

According to the U.S. Census Bureau, the rate of new housing starts in the U.S. hit 1.769 million in February of 2022, the highest since June 2006 despite material shortages, supply chain issues, and cost-of-living spikes. The US hemp building industry is riding this wave by moving forward in its efforts to certify hemp and lime (often referred to as “hempcrete”) insulation in U.S. building codes. On January 10, the U.S. Hemp Building Foundation submitted an appendix in the International Residential Codes to familiarize the U.S. permitting departments with hempcrete. During the final week of March, the International Code Council approved Proposal_RB316-22 for the International Residential Code, which is the ICC’s first step toward adopting hempcrete as an officially recognized building material.

Hempcrete is non-structural insulation commonly made of hemp hurd (the woody inner parts of the hemp stalk) and lime binder. An efficient insulator when installed up to one foot thick in wall assemblies, hempcrete has an impressive list of attributes. It is vapor-permeable, thermally regulating, fire-resistant and repels mold and pests. Because hemp plants sequester large amounts of carbon while growing, hempcrete is also carbon negative. Once incorporated into the construction, hempcrete can increase carbon negativity by absorbing carbon dioxide exhaled by building inhabitants.

U.S. construction industry professionals such as builders and architects could previously use hempcrete, but they often needed an alternative material variance and an engineer’s stamp on hempcrete house plans to do so. This requires them to go through a separate approval process for each project. Certification and the existence of a national code would eliminate this necessity. Though hempcrete has already been in popular use in Europe for over thirty years and, more recently, in Canada, it is still not widely understood as a material in the United States.  Building professionals have been tasked with providing research and other supporting documentation to building permitting authorities in order to demonstrate hempcrete’s capacity and limitations.

Beyond a standardized code to facilitate its use, there have been additional barriers to hempcrete’s integration into the U.S. construction industry. Many building professionals wrongly believe that hempcrete contains psychoactive components. Concerns that the process for making hempcrete is slow and labor-intensive, as well as hard to fully automate and standardize are warranted, however, and will need to be addressed before hempcrete can gain broader acceptance in the U.S. 

Fortunately, innovative companies like the UK’s IsoHemp and Canada’s Just BioFiber are forging the way with mass-produced and standardized hemp and hemp/proprietary material blocks, so hempcrete’s day in the U.S. may be dawning sooner than critics think. ICC’s approval of the hempcrete proposal initiates a public review process that will continue until June 20, 2022, with a final determination to be made at the Public Comment Hearing in Louisville, Kentucky, between September 14-21, 2022.


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