Monday, May 10, 2021

Kristen Nichols

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Chart: Significant profits still elusive for hemp manufacturers

Significant financial returns are still elusive for many hemp–products manufacturers, with only 8% of respondents to the Hemp Industry Daily survey saying their companies were “very profitable” in 2020. But the segment is getting there, with one-third of processor respondents noting their businesses were “somewhat profitable.”  At the same time, 42% of respondents said their operations still remained unprofitable.   A key difference when it comes to profitability appears to be the size of the operation. The more–profitable players tend to be the larger organizations, which are also putting more capital into the business to get the larger returns. They also are likely to be more established with more operational experience in this space.  More exclusive intelligence about the hemp industry is available in the Hemp & CBD Industry Factbook 2021 Edition. It’s on sale here.

Oregon CBD company latest to allege wrongful border seizure

Oregon hemp manufacturer We CBD is the latest to accuse U.S. Customs and Border Protection of wrongly seizing legal hemp products. The company in Sandy, Oregon, says that CBP seized 3,328 pounds of hemp biomass on Nov. 8 in Charlotte, North Carolina. The hemp was destined for an unnamed buyer in Zurich, Switzerland. We CBD says that when its carrier stopped to refuel in Charlotte, CBP called a local officer to do a field test. The test revealed the presence of THC but not how much.

USPS reviewing comments on mail vape limits

The U.S. Postal Service says it is reviewing public reaction to new vaporizer mail limits in advance of them taking effect April 26. The USPS plans to ban mailed vaporizers by mid-summer after Congress approved the ban in December. USPS spokesman David Coleman told Hemp Industry Daily that public comments on the new limits are not available to the public until the final ruling is announced. Several hemp and marijuana vape operators have said the change will severely harm their businesses.

How hemp, CBD companies can vet celebrity partnerships to avoid (embarrassing) pitfalls

This story originally appeared at Marijuana Business Daily. When Canopy Growth introduced its CBD drink brand, Quatreau, to the U.S. market on March 2, the Canadian cannabis producer also announced its newest brand ambassador: American astrologer Susan Miller. Ambassadors and celebrity partnerships are familiar terrain for Canopy, already known for its ties with Seth Rogen, Snoop Dogg and Martha Stewart. And while Miller isn’t a household name for all, she’s one of astrology’s more mainstream personalities and her celebrity fans include singer Katy Perry and actress Kirsten Dunst. Miller’s @astrologyzone has more than 430,000 followers on Twitte rand 112,000 on Instagram, many of whom are interested in wellness and self-care. And, according to her website, Miller writes for magazines such as Elle and Vogue Japan. But not everyone welcomed Canopy’s association with Miller. Some on social media were puzzled by the choice, questioning the move to align unscientific astrology with cannabidiol’s effects. Miller isn’t the first brand ambassador to raise eyebrows, which could be considered mild criticism compared to others.

FDA sends two more CBD warning letters

Two companies, one in California and the other in Michigan, are the latest to receive warning letters about CBD from the U.S. Food and Drug Administration. The warnings posted Monday accuse BioLyte Laboratories of Grand Rapids, Michigan, and Honest Globe of Santa Ana, California, of selling CBD pain relief products over the counter, a violation of federal law.

Oregon mulls new delta-8 THC limits in response to widespread availability

Oregon is considering new limits on delta-8 THC amid concerns that state regulations don’t adequately address the newly popular cannabinoid. Members of the Oregon Liquor Control Commission, which regulates the marijuana industry, recently discussed testing requirements and other safety regulations for delta-8 THC sold in dispensaries. Eleven states currently ban delta-8 THC entirely: Alaska, Arkansas, Arizona, Colorado, Delaware, Idaho, Iowa, Mississippi, Montana, Rhode Island and Utah.

Organigram CEO predicts ‘tightening regulations’ on CBD

Organigram, a Canadian marijuana company that recently partnered with a subsidiary of cigarette maker British American Tobacco to develop new products, is predicting increasing regulations coming to the CBD space. Organigram CEO Greg Engel says the regulatory landscape for CBD is soon to change. “We’re going to see tightening regulations, more restrictions, more focus not only on product claims, but you’re going to see more of a focus on input material, safety,” Engel told Marijuana Business Daily.

5 Reasons hemp companies should embrace DEA testing requirements

Roger Brown (Editor’s note: This story is part of a recurring series of commentaries from professionals connected to the hemp industry. Roger Brown is CEO and founder of ACS Laboratory in Sun City Center, Florida.) The final nationwide hemp rules taking effect Monday are more friendly to farmers because they increase the THC negligence standard to 1% and give farmers 30 days to test before harvest. The rules from the U.S. Department of Agriculture also give growers one more year to start working with laboratories registered with the U.S. Drug Enforcement Administration. Starting Jan. 1, 2022, all hemp cultivators must send samples to DEA-registered labs for THC potency testing. Some opponents believe the DEA requirement excludes many current labs from eligibility, which could cause a backlog in testing if farmers can’t easily find a certified facility. I say, why aren’t more labs DEA-registered already?

Elixinol Global buys Germany’s CannaCare in cash-and-stock deal

CBD maker Elixinol Global has acquired German CBD brand CannaCare Health GmbH as it executes its strategy to pursue market opportunities in Europe. Elixinol said it is buying the company for 3 million euros in cash ($3.6 million) plus 6 million euros in Elixinol shares ($7.2 million). The deal calls for Elixinol to pay up to 24 million euros ($29 million) if certain sales goals are met. CannaCare is based in Hamburg, Germany, and makes CBD oils, sprays and skincare products. The products are sold in 4,500 brick-and-mortar retail distribution points in Germany.

Largest human CBD trial launches with eye toward checking safety of trace THC

The largest-yet human CBD toxicological trial has been launched in Europe to check the effects of consuming trace amounts of THC. The European Industrial Hemp Association says it will assess 200 CBD users for a 30-day period. The association tells UK-based Cannabis Health News that the goal is to demonstrate to European regulators that trace THC is safe to consume. The effort will cost 1.6 million Euros ($1.9 million).

Fad or future? Delta-8’s popularity divides cannabis extraction industry

Delta-8 distillate, pictured, has a clear hue, not the typical yellowish tint. (Photo courtesy of Extract Labs) A rare cannabinoid that mimics the effects of delta-9 THC but can easily be produced from CBD is grabbing headlines and delivering impressive profits to extractors battling slumping prices for other hemp extracts. But the popularity of delta-8 THC is bringing out sharp divides in the cannabis industry, on both the hemp and marijuana sides. Some say delta-8 offers a nice alternative for consumers seeking an intoxicating buzz but not the debilitation and anxiety that can result from some highly potent THC products. (Delta-8 is an isomer of delta-9 THC and appears to bind less readily to cannabinoid receptors, resulting in milder effects.) But others warn that delta-8 is simply a knockoff of the real thing promoted by unscrupulous extractors looking to offload surplus CBD and sell intoxicating products in jurisdictions without legal access to delta-9 THC. And some fear that delta-8’s popularity threatens to undermine the entire hemp industry by alarming the politicians who approved hemp and its extracts without realizing some of those extracts could get folks high simply by following instructions widely available on YouTube. It’s a dilemma that has cannabis entrepreneurs debating whether to join the delta-8 bandwagon while it’s hot or stick to more common cannabinoids where the legal status is better understood. ‘It just started to take off’ Longtime hemp extractors concede that the delta-8 trend caught them off guard. The isomer was long understood as a weaker variant of the form of THC everyone is familiar with. So James Hurlston, CEO of Ratoon Agroprocessing in Marion, North Carolina, was surprised at the response he got last year to a social media post saying his lab had created delta-8 from a batch of CBD isolate. “I just kinda put it out there—’Hey, we made it some delta-8. Is anybody else doing this?’ And the response, oh my gosh! It just started to take off.” Also taken by surprise was Harold Jarboe, owner of Tennessee Homegrown, which grows hemp and makes CBD. He started making delta-8 from his CBD isolate last year in response to customer demand. Now, his delta-8 is cannibalizing his CBD sales. “It’s the cannabinoid for its time,” he said of delta-8 THC. ”We’ve heard this for years from our customers: ’Do you got anything stronger?’ And (delta-8) wasn’t real, real strong, but it was a little stronger, something that took the edge off the day a little bit.” Jarboe then started selling delta-8 products even to customers with legal access to conventional THC products. “You can do a fair amount (of delta-8 THC) to take the edge off. … But it doesn’t get on top of you the way delta-9 can.” Relieving a surplus Customer response to delta-8 isn’t the only reason CBD manufacturers are so excited about it. The cannabinoid’s wholesale value makes it almost impossible to resist. Delta-8 wholesale prices range from $1,500 to $2,000 a kilogram, depending on volume and quality, several extractors told Hemp Industry Daily. Prices were even higher last year. That compares to CBD isolate wholesale prices that have dropped to $600 per kilogram or lower because of abundant supply. Another appeal: the cannabinoid’s legal ambiguity makes it attractive for testing sales in new markets and in outlets still off-limits to traditional THC makers, such as convenience stores. Of course, legal opinions vary on whether delta-8 THC is legal if it comes from a hemp extract. Some say that because hemp and all its derivatives are legal, delta-8 THC is in the clear. Others point to a rule from the U.S. Drug Enforcement Administration about THC levels in hemp processing that would appear to make delta-8 THC an illegal synthetic version of its better-known cousin, delta-9 THC. At least one retailer, a smoke-shop operator in south Texas, has been charged with drug crimes for selling delta-8 THC products that came from hemp. (The case has not been resolved, and the DEA rule is under legal challenge by the Hemp Industries Association.) To Garrett Graff, attorney with Hoban Law Group in Denver, the landscape looks a lot like the legal thicket CBD faced in its early days. That’s because local law enforcement is being left to sort out some mixed messages in federal law, resulting in spotty enforcement. “It’s a complicated question,” he said of delta-8 legality. “There’s a potential conflict of law that hasn’t yet been resolved by a court.” Delta-8’s future The legal questions have some in the cannabis industry saying that delta-8’s clock is ticking. Sean Santa, an investment banker in Bethesda, Maryland, who helps cannabis companies raise capital, said that delta-8 products are too often jostling for consumers who would prefer delta-9 THC if they could get it. “I believe it it’s a fad,” Santa said of delta-8 products. “Right now it has this niche because of the legal gray area. But when that goes away, I think (delta-8) will be completely wiped out.” That legal gray area is sparking conversation in Congress and in statehouses about putting unwelcome limits on how hemp can be used, said Jonathan Miller, lawyer for the industry activist group U.S. Hemp Roundtable. “Basically they’re afraid that the 2018 Farm Bill somehow opened up a loophole for unregulated intoxicating products,” he said. “And we’ve been talking to a lot of folks in the marijuana industry. And they’re upset that there are competitive products being sold in gas stations without regulation, while they’ve got to go through dispensaries and abide by some very strict regulations.” Miller predicts a raft of delta-8 THC limits being proposed even in adult-use marijuana states. “Anything intoxicating should be treated like adult-use cannabis,” Miller said. “It should not be readily available unregulated at gas stations and vape shops.” Delta-8 manufacturers say the product will find a place in the larger cannabis economy no matter how it is regulated. “I don’t like delta-9; I don’t like the anxiety,” said Craig Henderson, CEO of Extract Labs in Boulder, Colorado. “But I do like relief of inflammation. I do like sleeping better. I do like having a slight mood change, maybe feeling a little better during the day. And there’s a lot of people like me.” Kristen Nichols can be reached at [email protected].

Cannabis grow-supply firm GrowGeneration acquires coir company

GrowGeneration Corp., a Denver-based cannabis grow-supply firm, has acquired Char Coir, a company that makes coconut-fiber growing substrate. Terms of the acquisition were not disclosed but GrowGeneration said it anticipated $15 million a year in revenue from sales of the new product. The grow-supply company is looking to add products to its private-label offerings, according to GrowGeneration CEO Darren Lampert. GrowGeneration operates 50 grow-supply stores in 12 states and trades on the Nasdaq as GRWG.

Chart: Top CBD sales channels

Despite CBD’s growing penetration in mainstream retail, the cannabinoid is mostly sold online — a trend that intensified during the COVID-19 pandemic. In a year when brick-and-mortar stores shut down because of the pandemic, business conducted online was the top sales channel for hemp-derived products in 2020. An estimated 66% of all hemp sales were conducted online, with the bulk of those being direct-to-consumer sales, according to Nielsen Global Connect.   Specialty businesses such as vaping stores, beauty shops, and health and natural stores, were the next leading sales channel, comprising about 29%-31% of all sales. Another 3%-5% came from major consumer packaged goods stores.   More exclusive intelligence about the hemp industry is available in the Hemp & CBD Industry Factbook 2021 Edition. It’s on sale here.

Mexico’s lower house approves landmark hemp, MJ legalization bill

Mexico’s Chamber of Deputies has approved a bill to allow regulated marijuana and hemp industries. But the pending law still has hurdles to overcome and it could be years before a flourishing industry emerges. Lawmakers in Mexico’s lower house voted largely in support of the bill, with 316 votes in favor and 129 against. There were 23 abstentions. Next, the Senate needs to review and approve the bill’s revisions before it heads to President Andres Manuel Lopez Obrador for his signature. After the law is enacted, Mexico will join Canada and Uruguay as the only countries to legalize an adult-use marijuana industry. However, the scope of the industry and available business opportunities will be largely carved out by the regulations in support of the law. Those regulations, yet to be developed, will limit opportunities in some cases and open the door to others. That could have unforeseen implications for businesses and investors. The Senate approved its version of the legalization bill in November. Mexico’s  Supreme Court earlier ruled that the absolute prohibition of recreational marijuana was unconstitutional, setting in motion the process to establish a formal law. Read more about the Mexico vote at Marijuana Business Daily.

Santa Fe Farms buys High Grade Hemp Seed to acquire its genetics portfolio

Santa Fe Farms of New Mexico has bought a Colorado hemp-genetics firm to establish a line of propietary genetics. High Grade Hemp Seed of Longmont, Colorado, will retain its name and location but will become a subsidiary of Santa Fe Farms, which grows hemp on about 200 acres but does not have its own line of genetics. The companies said in a statement that they’ll prioritize developing hemp varieties “that will adapt to climate change,” in addition to looking for market opportunities. Both firms are privately held, and terms of the acquisition were not announced.

Hemp in the Time of COVID-19: Executives reflect on pandemic’s anniversary

No part of the global economy has escaped the COVID-19 pandemic, which has claimed more than 2.5 million lives around the world and sickened countless more. But few industries were in the kind of infancy the hemp industry was in when the World Health Organization declared the virus a global pandemic on March 11, 2020. The resulting lockdowns, travel bans, economic collapse and distancing requirements hit just as many farmers were about to plant their first-ever legal hemp crops. Hemp acreage plummeted. Nascent extractors and hemp processors saw equipment delayed by manufacturing shutdowns. Those that managed to find equipment couldn’t open for business because of mandatory stay-at-home orders. And while many marijuana retailers were deemed “essential” businesses, depending on the state, hemp-specific retailers were generally closed. CBD brands that had scrambled to get on shelves of mass-market retailers such as department stores had to immediately pivot to online-only sales. Market analysts at the Brightfield Group, a Chicago-based data research firm, declared 2020 an “extinction event” for CBD brands, with 50% or more of an estimated 3,000 brands closing. But the hemp industry didn’t fold up shop because of the challenges. Some companies successfully adapted business plans; others made new ones to adapt. Hemp Industry Daily caught up (virtually, natch) with some hemp entrepreneurs to reflect on how the industry has reacted to the pandemic and get their predictions for what’s next. Time to focus The shutdowns and disease challenged all businesses, of course. But some hemp entrepreneurs say the unexpected halt to business gave them time to breathe and refine business plans in a go-go young industry. “It gave me an opportunity to pause,” said Larisa Bolivar, founder and CEO of Colorado-based Bolivar Hemp Co. She developed a cosmetics line, bought property in Oklahoma to start a new cultivation site and even finished a book she had been working on for years. “We were all feeling that same rush – you know,  we’ve got to get to market, we’ve got to be No. 1,” she said. “But that’s not always good for launching a business. “You really have to be strategic. Now, we have room to grow and we have plenty of time. I think COVID kind of reset that clock for everyone.” One entrepreneur even started a new business, with locations on two continents. Wendi Young set up an extraction company with locations in Colorado and Belfast, Ireland, while overcoming closed borders and shutdowns across jurisdictions. Young said she was inspired in part by having to take time off to care for a sick relative. “There was just a lot of time to really start thinking about, you know, what you want (and) what you want to accomplish,” she said. Other entrepreneurs found new resilience from their own employees. “We really saw our team come together in a very big way. Just looking at seeing how people are taking care of each other – I think that was such a big, monumental outcome of COVID,” said Priyanka Sharma, co-CEO of Kazmira, a hemp-derived cannabinoid extraction company based in Colorado. “It was nice to be able to step back from your own process, see what could be changed with what you were doing over time. … When you’re so in the weeds, you don’t get to step back and see where you can make changes.” Next normal So, which changes from the COVID-19 pandemic will stick with the hemp industry? Andrew Bish, chief operating officer of Bish Enterprises, a harvest-equipment manufacturer in Nebraska, said the pandemic has sparked market attention on non-flower uses for the plant. “We’re seeing a dramatic upswing in the grain and fiber markets,” Bish said. “I do think some of that increased demand in grain is coming from people eating at home and looking for more plant-based options, which is really exciting.” In addition to opening new market demand, the pandemic gave operators an opportunity to close underperforming lines. “It was a good opportunity to think about really what our primary goals were in the industry,” said Margaret Richardson, chief compliance officer and legal officer at Global Widget, a CBD manufacturer in Orlando, Florida. “We could think about, in terms of product offerings, really what we wanted to offer. “It gave us a chance to trim some of the products that weren’t as successful and refocus on formulation. … We came out on the other side, I think, stronger.” The full discussion on COVID-19 impacts to the hemp industry can be seen below. And share your insights and predictions live Thursday with Hemp Industry Daily editor Kristen Nichols at 4 p.m. ET/1 p.m. PT on Clubhouse. [embedded content]

Oregon hemp grower loses search-warrant challenge

An Oregon hemp producer seeking $2.5 million in damages after its warehouse was raided by authorities looking for illegal marijuana suffered a big setback in federal court. U.S. Magistrate Judge Mark Clarke ruled that the search warrant used when authorities raided Oregonized Hemp Co., a farm and farm service contracting business, was valid. The Grants Pass-based hemp company had argued that authorities from Josephine and Jackson counties was carried out improperly. According to the (Medford, Oregon) Mail Tribune, the judge conceded that the company and its owner are “understandably frustrated with the actions of law enforcement in this case,” but he said the search was constitutional. Clarke did note that Oregonized “suffered a large economic loss due to the destruction of their industrial hemp, which law enforcement misidentified as marijuana.” The judge gave Oregonized time to file an amended complaint based on his ruling about the search warrant.

Chart: US hemp legalization hasn’t cooled imports

Hemp imports were cited as a main driver for Congress voting in 2014 to authorize limited experimentation with the crop after decades of head-scratching policies allowing hemp to be bought and sold in the United States — as long as it was grown somewhere else. But hemp exports have grown dramatically ever since. Hemp imports grew 82% in the first year after the passage of the 2014 Farm Bill, from $42.9 million in 2014 to $78.1 million in 2015. Hemp imports continued to climb after hemp authorization was expanded four years later. Last year the U.S. imported an estimated $87.8 million in hemp, according to the 2021 Hemp & CBD Factbook. Non-CBD hemp imports into the United States grew by 10% in first 10 months of 2020, compared to the same period in 2019.  The value of incoming shipments of hempseed through October jumped nearly a quarter compared to 2019, while the value of raw hemp imports leaped by more than a third. The 10-month values for these two categories exceeded the full-year values for 2019 and offset severe drops in the import of hempseed oil and oilcake in 2020.  According to the International Trade Commission, Canada remained the top source for hemp imports in 2020, supplying more than 85% of incoming non-CBD products in the 10 months ended October. China, Romania, the Dominican Republic and Poland rounded out the top five countries delivering hemp fiber, textile and seed products to the United States during that period.  Compared to 2018, Lithuania, Germany and Bolivia were new entrants to the top 10 list of hemp-exporting countries in 2020.  More exclusive intelligence about the hemp industry is available in the Hemp & CBD Industry Factbook 2021 Edition. It’s on sale here.

New USDA confirms looming nationwide hemp rules

The nationwide hemp rules are taking effect March 22 as planned, with no additional delay or review because of the changed administration at the U.S. Department of Agriculture. The USDA gave notice Monday that the rules have been reviewed and are cleared to take effect as planned. The USDA was giving the hemp plan a second look because it was published less than 24 hours before former President Donald Trump left office in January. Among other changes, the final hemp rules: Allow hemp farmers to use common disposal methods to destroy hemp crops with more than 0.3% THC. Give hemp producers 30 days before harvest to get their plants tested for THC, up from 15 days.  Give farmers more breathing room before being considered “negligent” for producing hot hemp. The new negligence standard is 1% THC, up from 0.5% THC.  Not all the final rules have been embraced by the industry, though. The final rules retain a requirement that hot hemp flowers be destroyed and that testing labs be certified by the U.S. Drug Enforcement Administration. The rules also require hemp to tested for total THC content, not just delta-9 THC. Learn more about the final hemp rules in this free downloadable reference guide, “USDA Final Hemp Rule: A Handbook for Hemp & CBD Businesses.”

3 strategies to combat smokable hemp bans

(Editor’s note: This column is part of a recurring series of commentaries from professionals connected to the hemp industry. Andrew M. Rosner and Kaelan Castetter are vice presidents of the New York State Cannabis Growers and Processors Association.) Government officials nationwide are talking about banning the sale of hemp flower in the name of public health. But we know from experience that the prohibition could do more harm than good. Three of the four most populous states – California, Texas and New York – have either passed smokable hemp bans or are considering them. New York provides a good case study to guide industry in addressing this issue. In New York, the state Department of Health recently proposed regulations that ban the sale of hemp flower, which would result in harm to the many New Yorkers who prefer flower, a lower-cost item than other, more highly processed hemp products. By permitting flower, states can address safety and access to this fast-growing market segment. In fact, ensuring quality on unprocessed flower can utilize the same approaches for other manufactured products. The New York Hemp Regulations require farmers and processors to maintain strict record-keeping and test their products for: Cannabinoids. Heavy metals. Microbial impurities. Mycotoxins. Residual pesticides. Products sold in the marketplace must provide testing panels directly to consumers. Cannabinoid hemp products that contain levels that deviate from the allowable limits are considered adulterated and must be destroyed. New York State can take a similar approach with smokable flower by creating testing panels and limits for combustible products. Andrew M. Rosner Template for marijuana As it works to legalize adult-use marijuana, New York will almost certainly adopt standards for smokable products. Smokable hemp can provide a template for adult use and begin developing the internal processes that marijuana will require. The health department attempted to justify the smokable hemp ban by referring to its “efforts to reduce tobacco and smoking consumption.” Surprisingly, the same proposed regulations allow for vapable products, and Gov. Andrew Cuomo’s recent proposal allows for smokable marijuana products. New York’s health department rightfully took a harm-reduction strategy with hemp vaping products and should do so with hemp flower. Public-health approach Putting aside the current regulatory contradictions, a public health harm-reduction strategy should consider whether banning hemp flower will actually have any effect on people’s behavior. We know from studies of alcohol prohibition that consumption of alcohol remained steady over the period of the laws’ effect. Kaelan Castetter The banning of flower may actually lead to a rise in smoking tobacco — a known carcinogen with negative systemic health impacts. Consumer data suggests that banning flower would likely increase tobacco use. Market analytics firm Nielsen Global Connect found that 1 in 4 tobacco smokers consume hemp flower, while being three times more likely than the general population to purchase the product. Whether this is due to familiarity of consuming the plant in its unprocessed form or accessible price point (on average one third the price of CBD oil), tobacco smokers are now spending on average $88 a year on hemp flower products, according to Nielsen. These consumers will most likely shift that spending back to tobacco products, which lead to 480,000 American deaths annually and increased rates of addiction. Nicotine naturally occurs in the nightshade family of plants, such as tobacco, but not in hemp plants. Importantly, the World Health Organization in 2018 cited studies supporting the non-addictive nature of cannabidiol, a naturally occurring compound found in hemp plants. The report even goes so far as to mention the “possible therapeutic application” of CBD in addressing tobacco addiction in people. In New York, state Assemblywoman Donna A. Lupardo recently introduced a bill to amend the public health law in relation to cannabinoid hemp. As one of the authors of New York’s law giving the health department the role of regulating hemp, Lupardo understands the layers involved in hemp production and the legislative intent behind the original bill. Her recent actions indicate that the health department went too far in banning smokable flower. The prohibitive stance against hemp flower undermines the purported mission of the state — to ensure that New Yorkers purchase tested, labeled and quality-controlled hemp products. Lupardo recognizes the prevalence of people smoking hemp flower and wants to protect New York State residents. Lessons for the industry Using a multipronged approach, the hemp industry within states can play an instrumental role in opposing bans. First, start early to advocate directly with state representatives on statutory and regulatory language. Support from elected officials can help in significant ways in applying pressure on administrative bodies that may go rogue. Second, like in New York, consider independent legislation that legalizes smokable hemp flower. This can help prevent covert efforts to impose flower bans from outside sources. Third, like in Texas and Indiana, industry representatives can bring a lawsuit against the state for harms caused by the ban. Ideally, the hemp industry within a state will use a number of the above approaches in tandem with a vigorous social media campaign. Nothing beats getting the word out and letting other people know the impact of the ban on their family, friends and neighbors. Ironically, New York’s proposed flower ban came a century after the U.S. Constitution was amended to ban alcohol. Alcohol prohibition took 13 years to undo. We only hope that what started in 2020 with the release of the flower ban sees a much shorter period of prohibition and we learn from the mistakes of the past in creating hemp regulations that protect all New Yorkers. Andrew M. Rosner can be reached at [email protected] Kaelan Castetter can be reached at [email protected] To be considered for publication as a guest columnist, please submit your request to [email protected] with the subject line “Guest Column.”

CBD giant Charlotte’s Web positions to enter THC market

Hemp-derived CBD giant Charlotte’s Web Holdings is positioning itself to enter THC and marijuana markets. The Boulder, Colorado, company says it has signed a five-year, $8 million purchase agreement option with a marijuana company started by its founders, Stanley Brothers USA Holdings Inc. The deal allows Charlotte’s Web to take over the marijuana business after the U.S.  legalizes marijuana nationwide for a total price to be determined based upon revenue and EBITDA figures. Charlotte’s Web CEO Deanie Elsner says the company made the deal because of signs that federal marijuana reform is nearing. “Consumer attitudes, market trends and laws surrounding cannabis and its role within the wellness category continue to trend positively,” Elsner said in a statement. Stanley Brothers founders Jared and Joel Stanley are also members of CW’s board of directors but will step away from those positions to oversee the future acquisition. Stanley Brothers USA Holdings makes cannabis products that don’t qualify as legal hemp but are lower in THC than many formulations in adult-use cannabis markets.  The company has operations in Colorado, California and Florida. Charlotte’s Web trades on the Toronto Stock Exchange as CWEB.

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