Tag: CGC

CannabisNewsBreaks – Canopy Growth Corp. (TSX: WEED) (NYSE: CGC) Acquires Majority Stake in Biosteel Sports Nutrition, Inc.

Canopy Growth Corp. (TSX: WEED) (NYSE: CGC) announced today that it has completed an all-cash transaction to purchase a majority stake in leading producer of sports nutrition products BioSteel Sports Nutrition, Inc. The deal was highlighted in an article authored by Michael Berger on Technical420.com titled, ‘Canopy Growth Announces Purchase of Majority Stake in Biosteel Sports Nutrition Inc’. Per the article, the transaction offers a substantial platform for Canopy Growth to enter the scports nutrition and hydration segment. “BioSteel has a reputation for being a best-in-class provider of natural sports nutrition products and all of its products are well positioned to benefit from the increasing trend of plant-based and all-natural products, preferred not only by professional athletes, but active consumers as well,” Canopy Growth CEO Mark Zekulin stated in the article. “This acquisition allows us to enter the sports nutrition space with a strong and growing brand as we continue towards a regulated market of food and beverage products that contain cannabis. We view the adoption of CBD in future BioSteel offerings as a potentially significant and disruptive growth driver for our business.”

To view the full article, visit http://cnw.fm/Xg7W8

About Canopy Growth Corporation

Canopy Growth is a leading diversified cannabis, hemp and cannabis device company, offering distinct brands and curated cannabis varieties in dried, oil and Softgel capsule forms, as well as medical devices through the company’s subsidiary, Storz & Bickel GMbH & Co. KG. From product and process innovation to market execution, Canopy Growth is driven by a passion for leadership and a commitment to building a world-class cannabis company one product, site and country at a time. The company has operations in over a dozen countries across five continents. The company’s medical division, Spectrum Therapeutics is proudly dedicated to educating healthcare practitioners, conducting robust clinical research, and furthering the public’s understanding of cannabis, and has devoted millions of dollars toward cutting edge, commercializable research and IP development. Spectrum Therapeutics sells a range of full-spectrum products using its colour-coded classification Spectrum system as well as single cannabinoid Dronabinol under the brand Bionorica Ethics. The company operates retail stores across Canada under its award-winning Tweed and Tokyo Smoke banners. Tweed is a globally recognized cannabis brand which has built a large and loyal following by focusing on quality products and meaningful customer relationships. From the company’s historic public listing on the Toronto Stock Exchange and New York Stock Exchange to its continued international expansion, pride in advancing shareholder value through leadership is engrained in everything Canopy Growth does. Canopy Growth has established partnerships with leading sector names including cannabis icons Snoop Dogg and Seth Rogen, breeding legends DNA Genetics and Green House Seeds, and Fortune 500 alcohol leader Constellation Brands, to name but a few. Canopy Growth operates eleven licensed cannabis production sites with over 5.2 million square feet of production capacity, including over one million square feet of GMP certified production space. For more information, visit the company’s website at www.CanopyGrowth.com.

About CanadianCannabisWire

CanadianCannabisWire (CNW) is an information service that provides (1) access to our news aggregation and syndication servers, (2) CannabisNewsBreaks that summarize corporate news and information, (3) enhanced press release services, (4) social media distribution and optimization services, and (5) a full array of corporate communication solutions. As a multifaceted financial news and content distribution company with an extensive team of contributing journalists and writers, CNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. CNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today’s market, CNW brings its clients unparalleled visibility, recognition and brand awareness. CNW is where news, content and information converge.

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Political Backing, Investor Interest Fuel Kentucky Hemp Boom

CannabisNewsWire Editorial Coverage: The surging hemp industry means exciting benefits for Kentucky.

Hemp is big business in Kentucky. Among the companies working in the state is Sugarmade Inc. (OTCQB: SGMD) (SGMD Profile), a supplier of hydroponic equipment that is now moving into hemp through an investment in Hempistry. In New York, a leading politician has been in contact with Canopy Growth Corporation (TSX: WEED) (NYSE: CGC) to ensure the survival of a hemp project threatened by executive upheaval. Tilray Inc. (NASDAQ: TLRY) is looking even further than North America for growth. Cronos Group Inc. (TSX: CRON) (NASDAQ: CRON) is focusing on innovation in the sector. New Age Beverages Corporation (NASDAQ: NBEV) has been expanding its distribution and marketing power to reach into an ever-growing hemp market.

  • Kentucky is now the largest producer of hemp by state in the United States, fueled by local and national political support.
  • The hemp boom promises an alternative crop to struggling farmers.
  • The burgeoning industry is drawing investment into the state from hemp companies.

To view an infographic of this editorial, click here.

Hemp Achieves Great Growth in Kentucky

This year has seen a serious ratcheting up of hemp production across the United States. After the 2018 Farm Bill passed late last year legalizing national widespread hemp production, companies have been rushing to establish a foothold in the industry. Some are expanding test cultivation sites established under the 2014 bill, while others are setting up new operations.

This boon is proving particularly profitable for Kentucky. Having wholeheartedly embraced hemp cultivation under the previous regulations, the state is benefiting from a relatively well-developed industry that has existing strong political support. These favorable circumstances are attracting hemp companies and hemp investment into the state, helping to balance declines seen elsewhere in the state’s agriculture space.

Heading for Kentucky

A wide range of businesses, including brand-development company Sugarmade Inc. (OTCQB: SGMD), are investing in Kentucky’s hemp sector, funding the cultivation, processing and sale of the plant. Whether it’s being used for grain, fiber or CBD production, hemp crops are booming.

Hemp production in Kentucky began in 2014, when 20 approved growers planted 33 acres of the crop under legislation that supported trials of hemp farming. By 2018, the industry had grown 200 times in size to 6,700 acres cultivated by 210 growers. On top of this, 14 university projects and 72 processors were invested in the crop. Only Colorado exceeded Kentucky for hemp production within the United States.

Since the passage of the 2018 Farm Bill, the state has seen a further staggering surge in production. Kentucky now has 60,000 acres devoted to hemp production, making it the biggest hemp-producing state in the country. The industry has produced nearly a thousand jobs, 250 of them in the first half of this year. And as companies such as Sugarmade increase their investments in the state, that growth looks set to continue.

Sugarmade entered the hemp sector through hydroponics. A significant portion of hemp is grown indoors to provide greater control over how the crop is grown. Growth and acquisitions have made Sugarmade one of the hemp sector’s leading providers of hydroponic equipment and supplies, which are vital for this indoor growth.

Now the company is taking a more direct interest in hemp by exercising its option to invest in Hempistry Inc. Founded by Sugarmade’s own CEO Jimmy Chan, Hempistry is growing hemp in Madison County, Kentucky. Sugarmade is making a series of investments in the project that are expected to total an estimated $1 million.

“These investments into Hempistry make sense for Sugarmade, not only from a financial standpoint relative to probable rate of return, but also from a business development standpoint,” said Chan. “As Hempistry and other local cultivators grow, we believe Sugarmade’s status as a potential supplier to cultivators will also continue to rise. We look forward to a successful growing season with Hempistry.”

Kentucky Politicians Back Hemp Farmers

One of the reasons for Kentucky’s hemp boom is the strong support provided by politicians across the state. Representative James Comer and Senator Mitch McConnell have actively backed the industry at a national level, while Kentucky Agriculture Commissioner Ryan Quarles has been an advocate within the state. Under Quarles’s leadership, the Kentucky Agricultural Department has encouraged the development of the hemp industry, putting policies in place to support it.

This political support is at the heart of what makes Kentucky so appealing to companies such as Sugarmade as they seek opportunities for hemp investment. Though hemp is once again legal on a federal level, the road to this point has been rocky, and the industry is likely to face further political hurdles. Knowing that Kentucky will provide political support makes the state an appealing place to invest.

McConnell has been particularly essential in establishing this support. The senior Kentucky senator used his position as majority leader to push hemp reform through the federal legislative process. This summer, he publicly reinforced his support for hemp through a tour of the industry in Kentucky with Sonny Perdue, head of the U.S. Department of Agriculture (USDA). The tour marked an important moment for Kentucky as a leader in that industry, as well as the hemp industry as a whole, acknowledging its newfound legitimacy.

Among the issues the two men talked about on the tour was improving access to finance for hemp growers. Though December’s farm bill legislation theoretically should have removed financial barriers, in practice, banks need encouragement to change their approach. With high-profile advocates such as McConnell and Perdue taking a firm stance, this is likely to change rapidly, making life easier for companies such as Hempistry and Sugarmade.

Hemp Provides Something We Need

In strained political times, hemp has provided something we all need — an issue on which politicians from both major parties can agree. The hemp provisions of the farm bill passed thanks to cross-party support, and politicians from both sides of the aisle have been keen to encourage the industry.

Nothing makes this clearer than the involvement of both Democrat and Republican senate leaders in supporting and encouraging the industry. Earlier this month, Senate Minority Leader Chuck Schumer spoke directly to the leadership of Canopy Growth Corp. to ensure that recent changes at the company wouldn’t stand in the way of a building a cutting-edge hemp facility in New York. When companies such as Sugarmade see this type of support, they feel confident investing heavily in hemp, knowing that both parties support industry expansion.

The reason behind this widespread support is that hemp caters to another need — new avenues for farmers to make a living. Farm production in the United States is at a six-year low, with many farmers struggling to get by. Economic disruption and trade wars threaten to further undermine their financial well-being. As a high-value cash crop, hemp offers a lifeline to farmers, making support of the industry more important than ever.

The money poured into the industry by Sugarmade and other savvy companies may be the difference between success and failure for rural communities. And it doesn’t hurt that, along the way, these investments appear likely to be highly profitable for these companies and their investors.

Hemp Producers Rise to Prominence

The growth of the industry has brought hemp-growing companies to greater prominence than ever.

Schumer’s call to Canopy Growth Corporation (TSX: WEED) (NYSE: CGC) highlights just how much influence these companies now have, as they nurture the first shoots of what promises to become a fruitful industry. Canopy Growth Corporation is one of the largest Canadian companies operating in the hemp space, a leader in the field with significant resources and influence. The surprise removal of CEO Bruce Linton caused alarm in some quarters as well as uncertainty about the company’s future direction. But Schumer’s direct intervention has brought reassurance that the company will move ahead with its New York hemp plans.

While Canopy Growth has shed its most prominent executive, competitor Cronos Group Inc. (TSX: CRON) (NASDAQ: CRON) has added a new one to its team. Dr. Todd Abraham is joining the company as chief innovation officer. A thought leader in the field of consumer packaged goods, Abraham has shown faith in the staying power of the hemp industry through his move to Cronos. He’ll have plenty of tools to innovate with, as the company recently announced that it is establishing a brand new R&D facility, as well as acquiring a state-of-the-art fermentation and manufacturing facility. These deliberate moves put Cronos Group in a strong position to create new products using cultured cannabinoids.

The industry expansion isn’t limited to just the United States and Canada. Tilray Inc. (NASDAQ: TLRY) has recently arranged the export of CBD-rich oils to Ireland and is expanding its European leadership team. Hemp and CBD markets operate under different rules in Europe, so local knowledge is essential for expansion there, and Tilray is investing in that knowledge.

New Age Beverages Corporation (NASDAQ: NBEV) has also been pushing to become a global brand, following an announcement to this effect in April. But the company isn’t neglecting its American markets. It recently acquired marketing, sales and distribution company Brands within Reach to strengthen its marketing and distribution position in North America, working to take its relaxing drinks to an ever-wider market.

With the support of politicians and business leaders, hemp is clearly growing in popularity. Nowhere is the economic impact of that felt more strongly than in Kentucky.

For more information on Sugarmade, visit Sugarmade Inc. (OTCQB: SGMD)

About CannabisNewsWire

CannabisNewsWire (CNW) is an information service that provides (1) access to our news aggregation and syndication servers, (2) CannabisNewsBreaks that summarize corporate news and information, (3) enhanced press release services, (4) social media distribution and optimization services, and (5) a full array of corporate communication solutions. As a multifaceted financial news and content distribution company with an extensive team of contributing journalists and writers, CNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. CNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today’s market, CNW brings its clients unparalleled visibility, recognition and brand awareness. CNW is where news, content and information converge.

Receive Text Alerts from CannabisNewsWire: Text “Cannabis” to 21000

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DISCLAIMER: CannabisNewsWire (CNW) is the source of the Article and content set forth above. References to any issuer other than the profiled issuer are intended solely to identify industry participants and do not constitute an endorsement of any issuer and do not constitute a comparison to the profiled issuer. The commentary, views and opinions expressed in this release by CNW are solely those of CNW. Readers of this Article and content agree that they cannot and will not seek to hold liable CNW for any investment decisions by their readers or subscribers. CNW is a news dissemination and financial marketing solutions provider and is NOT registered broker-dealers/analysts/investment advisers, hold no investment licenses and may NOT sell, offer to sell or offer to buy any security.

The Article and content related to the profiled company represent the personal and subjective views of the Author, and are subject to change at any time without notice. The information provided in the Article and the content has been obtained from sources which the Author believes to be reliable. However, the Author has not independently verified or otherwise investigated all such information. None of the Author, CNW, or any of their respective affiliates, guarantee the accuracy or completeness of any such information. This Article and content are not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action; readers are strongly urged to speak with their own investment advisor and review all of the profiled issuer’s filings made with the Securities and Exchange Commission before making any investment decisions and should understand the risks associated with an investment in the profiled issuer’s securities, including, but not limited to, the complete loss of your investment.

CNW HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.

This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected,” “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and CNW undertakes no obligation to update such statements.

With 10,000 Licenses Issued, California Reflects the Growing Power of Hemp

CannabisNewsWire Editorial Coverage: As hemp production increases, Californian legislators have extended the duration of thousands of cannabis cultivation licenses to support the state’s thriving industry.

Sugarmade Inc. (OTCQB: SGMD) (SGMD Profile) is supporting many of these companies that have cultivation licenses by providing cultivation and extraction equipment. Canopy Growth Corporation (TSX: WEED) (NYSE: CGC), one of the biggest companies in the sector, is increasing its growing capacity while helping educate about medicines. Cronos Group Inc. (TSX: CRON) (NASDAQ: CRON) is leaning into new technology, with new facilities for R&D and processing. The Green Organic Dutchman (TSX: TGOD) (OTCQX: TGODF) (TGODF Profile) has tapped into the demand for organic produce and is now expanding into global CBD market. GW Pharmaceuticals Plc (NASDAQ: GWPH) (OTC: GWPRF) is developing powerful new medicines, in which hemp could help tackle previously uncurable illnesses.

  • California is one of the largest regions for cannabis and hemp cultivation.
  • Recent legislative moves show that the state’s politicians are hemp friendly.
  • Demand for hemp and cannabidiol (CBD) continues to soar.
  • Companies are responding with increased production, acquisitions and new technology.

To view an infographic of this editorial, click here.

The Land of Mass Licensing

The past year has seen substantial growth in the Californian hemp industry, and with that growth came challenges for the state’s governing bodies. The state is home to one of the largest legalized recreational cannabis markets in the world, and Californian authorities have reportedly issued over 10,000 licenses to producers, processors and retailers involved in the cannabis industry. This includes those working with hemp, a non-psychotropic form of cannabis, and CBD, a chemical derived from hemp.

The swift growth of the state’s industry almost triggered a crisis this spring, as thousands of temporary licenses were set to expire before authorities had time to process permanent licenses. The state senate stepped in to extend the duration of temporary licenses and protect law-abiding business owners from a bureaucracy struggling to keep up with demand.

The legal move to extend the licenses may indicate the state’s political attitude toward the industry and holds promise for companies working in California.

A Friendly Place to Work

For companies working with hemp and related products, California is possibly the most business-friendly place in the world to be based. The state is headquarters for a wide range of companies working in the sector, from producers and retailers to companies providing support services, such as Sugarmade Inc. (OTCQB: SGMD).

Based in Monrovia, California, Sugarmade develops brands and products with disruptive potential. Over the past few years, this strategy has led the company to develop a growing focus on hemp and the surrounding sector, a space filled with innovation, fast-developing new practices and promising potential.

Rather than being cultivator or retailer, however, Sugarmade is a supplier of vital materials to the hemp industry. The company sells hydroponic equipment and supplies needed for growing consistent, high-quality crops in secure, climate-controlled indoor facilities. SGMD is moving deeper into the market by extending its catalog to include extraction equipment, essential in the process of acquiring valuable CBD from hemp plants.

California is home to so many of these companies for a number of reasons. The state is one of the largest markets in the world by population for hemp and related products, with only Canada matching it in scale. In addition, California is one of the first areas to become friendly to the industry, passing groundbreaking legislation in the 1990s allowing the space to progress.

This attitude has been both supported and encouraged by a political establishment that appears to look favorably on the industry. The Californian senate, having seen thousands of new businesses such as Sugarmade spring up, is eager to nurture these entities for the jobs and wealth they bring to the state’s economy. This general support is reflected in the government’s decision to extend temporary licenses to prevent new businesses from faltering just as they had been established.

Staggering growth has caused challenges for the Californian authorities in providing licenses. The federal legalization of hemp in December added to interest in the industry and pressure on the licensing system. The state’s responsiveness to problems within the system has shown how serious it is about hemp and creating a friendly environment for the likes of Sugarmade and its customer base.

The Hemp Revolution

The situation in California appears to reflect a much wider pattern in the hemp industry, across the United States and beyond.

Ten years ago, hemp was barely even mentioned in conversations about business. As a source of useful materials, its use had fallen out of fashion with the end of the age of sail, during which it had provided fibers for ropes and canvas. But then a shift came, as companies in the cannabis space looked for other options they could market. As a nonpsychoactive ingredient, CBD could be sold in markets where cannabis itself couldn’t. And hemp offered a rich source of CBD without many of the complications surrounding the rest of cannabis.

Since then, demand for CBD has rocketed. The component is used in a wide range of products including cosmetics, health foods, and vaping liquids. Companies have emerged specifically to cater to the hemp market, and those companies have turned to the likes of Sugarmade for the equipment they need.

The popularity of CBD among consumers has also rocketed, leading to shortfalls in supply. The 2018 Farm Bill, which legalized the hemp trade at the federal level in the United States, will help with meeting this demand in the long term. But the bill is no magic bullet, and companies need time to gear up in the new commercial environment that has been created.

This gearing up has led to increased demand for cultivation equipment, creating shortages in that area. Cultivators have bought everything that Sugarmade can provide, as hydroponics companies see a boom in sales alongside the hemp companies they serve.

Dealing with Demand

Sugarmade has made a variety of moves — in California and beyond — to meet this growing demand.

Expansion is obviously critical to making the most of this opportunity, and the company has entered a period of serious growth in its sales, product lines and bottom line. As a critical link in the hemp supply chain, Sugarmade is not just in a position to grow, the company must grow in order to meet customer needs.

One of the key tactics in this expansion has been SGMD’s use of acquisitions and agreements. The company acquired Sky Unlimited LLC and, through it, the AthenaUnited.com online sales operation, increasing its sales capacity. Sugarmade has also struck deals with companies such as Hempistry, BizRight Hydroponics and Plantation Corp, ensuring smooth supply chains and greater capacity to meet surging demand.

Adding new technology to its catalog has allowed Sugarmade to make better use of this moment. The company is moving to supply next-generation extraction machinery and develop artificial intelligence systems to monitor hemp crops. By providing its customers with the latest technology, Sugarmade may be better able to distinguish itself from its competitors and ensure the profitability of its customers, for its own long-term good.

Space for Growth

With customer demand firmly outstripping supply, the hemp sector is creating a space in which a wide range of businesses can flourish.

One of the most important is Canadian company Canopy Growth Corporation (TSX: WEED) (NYSE: CGC), which was the largest cannabis company in the world by market capitalization as of April this year. Like Sugarmade, Canopy Growth Corporation has taken big steps to continue expanding and claim a larger share of the hemp and related markets. The company has increased its production capacity through a mixture of acquisitions and ongoing work to increase its existing licensed production facilities. Acquisitions have also featured in its work further down the supply chain, such as acquiring hemp skin care company This Works.

Like Sugarmade, Cronos Group Inc. (TSX: CRON) (NASDAQ: CRON) is looking to new technology to support its expansion. The company recently announced the creation of an R&D facility, which has the potential to provide new products for a curious and often experimental customer base. To support such innovations, the company is also acquiring a state-of-the-art fermentation and manufacturing facility, which will allow Cronos to produce cultured cannabinoids.

The Green Organic Dutchman (TSX: TGOD) (OTCQX: TGODF) has focused on a specific sector of the customer base, setting itself up as a source of organic and sustainably grown products. The creation of two new production facilities will allow the company to tap into rising demand, increasing its growing capacity from 156,000kg to 202,500kg. And with the growing popularity of hemp-CBD products, the company is setting up a global strategic hemp division to give it greater global reach in an important part of the sector.

GW Pharmaceuticals Plc (NASDAQ: GWPH) (OTC: GWPRF) is applying the power of cannabidiol to tackle otherwise untreatable diseases. The company’s 20 years of experience in the sector is currently being applied to seizures associated with tubular sclerosis complex, for which one of its drugs recently underwent successful clinical trials. GW has become a world leader in cannabinoid medicines, whose value is increasingly widely recognized.

With hemp and related sectors growing so fast, California’s senators appear to have made a wise decision to smooth the way for local cultivators. Both customers and businesses in the state and beyond may see the benefits.

For more information on Sugarmade, visit Sugarmade Inc. (OTCQB: SGMD)

About CannabisNewsWire

CannabisNewsWire (CNW) is an information service that provides (1) access to our news aggregation and syndication servers, (2) CannabisNewsBreaks that summarize corporate news and information, (3) enhanced press release services, (4) social media distribution and optimization services, and (5) a full array of corporate communication solutions. As a multifaceted financial news and content distribution company with an extensive team of contributing journalists and writers, CNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. CNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today’s market, CNW brings its clients unparalleled visibility, recognition and brand awareness. CNW is where news, content and information converge.

Receive Text Alerts from CannabisNewsWire: Text “Cannabis” to 21000

For more information please visit https://www.CannabisNewsWire.com and or https://CannabisNewsWire.News

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DISCLAIMER: CannabisNewsWire (CNW) is the source of the Article and content set forth above. References to any issuer other than the profiled issuer are intended solely to identify industry participants and do not constitute an endorsement of any issuer and do not constitute a comparison to the profiled issuer. The commentary, views and opinions expressed in this release by CNW are solely those of CNW. Readers of this Article and content agree that they cannot and will not seek to hold liable CNW for any investment decisions by their readers or subscribers. CNW is a news dissemination and financial marketing solutions provider and is NOT registered broker-dealers/analysts/investment advisers, hold no investment licenses and may NOT sell, offer to sell or offer to buy any security.

The Article and content related to the profiled company represent the personal and subjective views of the Author, and are subject to change at any time without notice. The information provided in the Article and the content has been obtained from sources which the Author believes to be reliable. However, the Author has not independently verified or otherwise investigated all such information. None of the Author, CNW, or any of their respective affiliates, guarantee the accuracy or completeness of any such information. This Article and content are not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action; readers are strongly urged to speak with their own investment advisor and review all of the profiled issuer’s filings made with the Securities and Exchange Commission before making any investment decisions and should understand the risks associated with an investment in the profiled issuer’s securities, including, but not limited to, the complete loss of your investment.

CNW HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.

This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected,” “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and CNW undertakes no obligation to update such statements.

Cannabis Companies Seek Strong Strategies to Meet Growing Demand

CannabisNewsWire Editorial Coverage: With demand outstripping supply, successful cannabis companies are following smart core strategies and reporting strong revenues.

Golden Developing Solutions Inc. (OTC: DVLP) (DVLP Profile) has used a mix of acquisitions, diverse brands and products, and increased production footprint to meet customer demand and report significant revenue increases, including its strongest second-quarter numbers ever. Industry giant Canopy Growth Corporation (TSX: WEED) (NYSE: CGC) has followed a similar path, though some change may follow the recent departure of its co-CEO. Tilray Inc. (NASDAQ: TLRY) has invested heavily in increasing production while reaching into new markets such as the United Kingdom. Medmen Enterprises Inc. (CSE: MMEN) (OTCQX: MMNFF) and Curaleaf Holdings Inc. (CSE: CURA) (OTCQX: CURLF) have both shown the potential for growing multistate businesses in the United States, despite the challenges created by federal legislation.

  • Increasingly liberal laws have allowed demand to show in the legal market, but supply has not yet caught up.
  • To meet this demand, the industry needs to increase production.
  • Individual companies are using acquisitions and diversification to improve their revenues.

To view an infographic of this editorial, click here.

Expanding Business

The cannabis, hemp and CBD sector is experiencing a period of huge expansion. With medical cannabis now legal in 60% of U.S. states, recreational cannabis legal in many states as well as Canada, and hemp production legalized on a federal level, North America has become home to a thriving industry. What was relegated to illegal markets and fringe cases only 20 years ago is now the source of an economic boom.

In this brave new world of legal business, cannabis companies are looking for ways to maximize their profitability and ensure a strong position as the market keeps expanding. So what are the strategies bringing success for the growing cannabis companies, both big and small? And how are those strategies contributing to the development of the sector?

Expanding Production

For the companies working in this sector, such as Golden Developing Solutions Inc. (OTC: DVLP), their work in the space is producing strong growth and sales numbers. From March 2018 to March 2019, Golden Developing Solutions saw an 800% jump in performance. Further growth was announced in May, as the company went from strength to strength.

“As we projected, top-line performance is accelerating across all metrics following our recent investments,” said Triant. “Everything is clicking right now.”

For Golden Developing Solutions, some of its growth is coming by expanding production. With the cannabis industry being so new and tightly regulated, production is relatively limited. And with demand rising rapidly, especially for hemp-derived CBD, the industry is currently struggling to meet customers’ needs. This demand supports high prices but still means that producers are missing out on opportunities, as there is untapped potential in the market.

Golden Developing Solutions is just one of the companies expanding its production capacity in response to this trend. The expansion is a complex undertaking, as a hemp or cannabis production facility requires a specially adapted building, hydroponic equipment to grow the plants, security and other support facilities, and an appropriate license from the relevant local authority. When a new growing space is established, such as Golden Developing Solutions’ recently announced 25,000-square-foot facility in Denver, Colorado, it’s big news for both the company and the industry.

This move in Colorado by Golden Developing Solutions was a direct response to that gap between supply and demand. Already equipped with much of the equipment it needs, and with licensing in place to produce marijuana infused products, DVLP has identified an ideal space with promising potential.

“Our CBD Infusionz segment is bursting at the seams right now,” said CEO Stavros Triant. “Demand already vastly outstrips supply capacity. This new facility directly addresses that issue, and should provide the necessary room for the explosive growth that we anticipated when we made that acquisition in March.”

Acquisitions and Subsidiaries

Increasing production space is the only way for the industry as a whole to address supply shortages. But for individual companies, other options to increase their presence in the sector are available.

The past two years have seen a huge surge in acquisitions in the cannabis sector. These acquisitions have allowed companies to grow in size, resulting in increased supplies and sales. Though it doesn’t directly lead to an increase in overall supply, the benefits in scale and efficiency mean that, in the long term, this coming together of companies could lead to better supplies.

For Golden Developing Solutions, its most important recent acquisition has been Infusionz LLC, a manufacturer of CBD products. Completed in March, the acquisition gave Golden Developing Solutions control not just of Infusionz’s production base but also of its established brands and retail links. Building relationships with customers is a tricky business in an industry where licensing limits marketing options and where brand allegiances are just starting to form. Acquiring a brand for which demand already outstrips supply is invaluable.

This is a common pattern for mergers and acquisitions in the cannabis and CBD space. Though brands may be relatively small scale compared with other industries, they are often not folded into existing lines on acquisition. The benefits of experimenting with new brands and tapping into their customer base outweigh what might be gained by merging output to supply a smaller number of brands.

A More Diverse Approach

Infusionz isn’t the only subsidiary in Golden Developing Solutions’ armory. In addition to Where’s Weed, a core pillar of the company since 2011 connecting medical and recreational cannabis consumers with local dispensaries, delivery services, strains and more, the company is also focusing its attention on Where’s CBD.

Similar in nature, Where’s CBD is a new technology resource and future online marketplace connecting CBD consumers with local businesses, brands and educational content across the United States, helping people quickly find the right products for themselves or their loved ones.

Providing a powerful opportunity to capture both customers and purchasing data while providing distribution channels for brands, Where’s CBD is a diverse addition to the company that inherently adds more value to the overall ecosystem and foundation that has been built thus far.

By increasing production, acquiring smaller competitors, and diversifying their products and services, cannabis companies are becoming stronger than ever.

Among these strengthening companies is Canopy Growth Corporation (TSX: WEED) (NYSE: CGC). If any company can be considered an established giant in such a young industry, it’s Canopy Growth. Emerging from the Canadian market in 2013, Canopy Growth quickly rose in power off the back of the Canadian medical cannabis sector. As of April 2019, Canopy Growth was the largest cannabis company in the world as measured by market capitalization and showed no sign of faltering. Like Golden Developing solutions, it has followed the three main paths to growth in the sector, including diversifying its product line to suit a market that now includes recreational cannabis and CBD derivatives as well as medical cannabis. The recent departure of co-CEO Bruce Linton has caught observers by surprise but is unlikely to disrupt Canopy Growth’s ongoing rise.

Another of the big Canadian companies, Tilray Inc. (NASDAQ: TLRY) recently announced the investment of $32.6 million in expanding its cultivation and manufacturing facilities. The expansion work, taking place over three sites, will increase the company’s production and manufacturing footprint to 1.3 million square feet. The company’s growth includes reaching into new markets, with the recent announcement that it has exported bulk amounts of cannabis oil into the United Kingdom. The United Kingdom only allowed the use of cannabis oils recently — with stringent restrictions. Some expect this to become the thin end of the wedge, as many in the country would like to see cannabis rules liberalized, especially where the drug can meet medical needs. By being one of the first bulk providers in the country, Tilray could establish itself as an important name before the British market is even fully formed.

Of course, there’s still room for improvement in the legal situation in the United States, and Medmen Enterprises Inc. (OTCQX: MMNFF) (CSE: MMEN) has established itself as one of the largest financial supporters of progressive marijuana laws. The gap between federal laws and those in individual states is an ongoing problem for companies working in North America, making it hard to carry out cross-state operations. Despite this, Medmen has managed to establish a multistate business working across 19 facilities that, through a move into Arizona, bring business to five states.

Another U.S. company, Curaleaf Holdings Inc. (CSE: CURA) (OTCQX: CURLF) is a vertically integrated medical and wellness cannabis company whose strategic focus is specifically on areas where demand is most likely to go unmet. Working in states such as Florida, Massachusetts, New Jersey and New York, which are highly populated but have limited licensing, the company is bringing its products to customers who may struggle to get the cannabis and CBD derivatives they are looking for. Curaleaf has used acquisitions to help with this strategy, with the recent acquisitions of Emerald Dispensary.

By diversifying, increasing production and acquiring other companies, cannabis businesses are expanding to meet previously unmet demand.

For more information on Golden Developing Solutions, visit Golden Developing Solutions Inc. (OTC: DVLP)

About CannabisNewsWire

CannabisNewsWire (CNW) is an information service that provides (1) access to our news aggregation and syndication servers, (2) CannabisNewsBreaks that summarize corporate news and information, (3) enhanced press release services, (4) social media distribution and optimization services, and (5) a full array of corporate communication solutions. As a multifaceted financial news and content distribution company with an extensive team of contributing journalists and writers, CNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. CNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today’s market, CNW brings its clients unparalleled visibility, recognition and brand awareness. CNW is where news, content and information converge.

Receive Text Alerts from CannabisNewsWire: Text “Cannabis” to 21000

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DISCLAIMER: CannabisNewsWire (CNW) is the source of the Article and content set forth above. References to any issuer other than the profiled issuer are intended solely to identify industry participants and do not constitute an endorsement of any issuer and do not constitute a comparison to the profiled issuer. The commentary, views and opinions expressed in this release by CNW are solely those of CNW. Readers of this Article and content agree that they cannot and will not seek to hold liable CNW for any investment decisions by their readers or subscribers. CNW is a news dissemination and financial marketing solutions provider and is NOT registered broker-dealers/analysts/investment advisers, hold no investment licenses and may NOT sell, offer to sell or offer to buy any security.

The Article and content related to the profiled company represent the personal and subjective views of the Author, and are subject to change at any time without notice. The information provided in the Article and the content has been obtained from sources which the Author believes to be reliable. However, the Author has not independently verified or otherwise investigated all such information. None of the Author, CNW, or any of their respective affiliates, guarantee the accuracy or completeness of any such information. This Article and content are not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action; readers are strongly urged to speak with their own investment advisor and review all of the profiled issuer’s filings made with the Securities and Exchange Commission before making any investment decisions and should understand the risks associated with an investment in the profiled issuer’s securities, including, but not limited to, the complete loss of your investment.

CNW HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.

This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected,” “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and CNW undertakes no obligation to update such statements.

New Technology Enters the Market as Demand Rises for Hemp Processing Power

CannabisNewsWire Editorial Coverage: Rising hemp production is putting pressure on processing.

Sugarmade Inc. (OTCQB: SGMD) (SGMD Profile), a provider of cultivation equipment, is adding processors to its catalog of products, focusing on next-generation machinery. Canopy Growth Corporation (NYSE: CGC) (TSX: WEED) will be among the companies with a rising demand for processing, as it increases both its cultivation capacity and its product lines. Demand is rising in part thanks to CBD’s public profile, with deals such as the partnership between Aurora Cannabis Inc. (NYSE: ACB) (TSX: ACB) and UFC shining a spotlight on the plant and its potential. New uses for CBD are also increasing demand for the plant, with R&D led by companies such as Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON) and Aphria (NYSE: APHA) (TSX: APHA).

  • Hemp can be processed to extract both fibers and cannabidiol (CBD).
  • CBD is currently the most valuable segment of the North American hemp market, though demand is likely to grow for fiber processing.
  • Larger machines offer one option to increase the scale of processing.
  • New technology may provide a more efficient answer.

To view an infographic of this editorial, click here.

Masses of Hemp

The year 2019 looks to be a bumper year for the U.S. hemp industry. Rising consumer demand has met the legal relief of the 2018 Farm Bill, whose passage in December paved the way for legal hemp cultivation and processing across the country. The industry is preparing to make hay while the sun shines — or in this case, make heaps of hemp.

This rise in production, which is expected to continue into next year and beyond, is inevitably creating complications. Most important among these is the challenge of processing the hemp. U.S. hemp-processing businesses are relatively new and small scale, as is much of the machinery with which they work. If the industry is to profit from the massive rise in hemp production, then it needs to ramp up its processing capacity. Otherwise today’s bumper crops could become tomorrow’s waste.

What We Get from Hemp

Hemp production and processing has risen from nothing to become a huge business in just the last few years. Companies working in the sector, such as Sugarmade Inc. (OTCQB: SGMD), cover a wide range of products and services, from providing cultivation supplies to marketing new products to consumers.

Those products usually incorporate one of the two main ingredients that can be extracted from hemp: fibers and cannabidiol (CBD).

Fibers are how hemp has been traditionally cultivated and used. For centuries, hemp was the basis of rope and cloth, playing an essential part in equipping navies and clothing people. This use fell out of fashion in the 20th century, as sailing was replaced by mechanical shipping, and hemp became caught up in drugs criminalization efforts. As a result, America is not well positioned to produce hemp fiber, and imports most of what it uses from China, a country with a more advanced hemp fiber industry. But with growing interest in hemp and the disruption of trade wars, home-grown fibers have moved onto center stage, with more companies recognizing the significant opportunity the crop offers.

The product that has brought American companies such as Sugarmade into the hemp space is one of the breakaway commercial phenomena of the past decade — CBD. A natural chemical found in hemp and related plants, CBD has recently been the subject of much research and development. Claims have been made for its effectiveness in relaxation, pain management and countering anxiety. The component has become a popular ingredient in health and well-being products, including supplements, foods and toiletries.

With a bumper harvest of hemp expected this fall, companies throughout the value chain are asking how raw hemp can most effectively be processed to provide for the massive demand for CBD.

Scaling Up

The industry is clearly going to have to scale up to meet the challenge of hemp processing. This burgeoning increase is creating unprecedented levels of demand for processing machinery.

“Our staff has done extensive research into the fast-growing hemp industry,” said Sugarmade CEO Jimmy Chan. “We continue to see an imbalance between cultivation outputs and extraction capacities within the industry. This leads us to believe the market for extraction services and the equipment required by these extraction companies will continue to accelerate.”

The company has responded by entering the market for hemp extraction technologies and equipment. As a supplier of cultivation supplies, Sugarmade has already benefited from the green rush surrounding the Farm Bill and the growing interest in hemp that preceded it. Moving from cultivation equipment to extraction equipment is a natural next step for a company whose business model is built around supporting cultivators.

In addition to increasing the number of machines available, many companies are looking into providing bigger machines that can process ever bigger volumes of biomass. But the drawback of this “bigger is better” philosophy is cost. The larger machines being installed in many extraction facilities are expensive, not just for the machines themselves but also the associated costs. Expenses such as real-estate square footage and ethanol storage have to be factored in, and once those costs are included, a modern hemp-extraction facility can easily cost tens of millions of dollars, a cost passed on to cultivators through processing fees.

While the industry’s processing capacity clearly needs to increase, the best solution may not be the most obvious. Sugarmade is looking at a different approach.

New Technology

Rather than focus on larger versions of current machines, Sugarmade is exploring the next generation of hemp-processing technology.

Most CBD extraction in the United States currently uses ethanol to chemically separate the CBD from the rest of the plant and make it available for use. But other options are available and are becoming more sophisticated. New technology using water-based sonication extraction, microwaves and other techniques may transform the way extraction is carried out — and significantly impact costs as well. These machines, which Sugarmade plans to make available to its customers, could reduce the cost of extraction and so help cultivators increase their output without exorbitant increases in cost.

These technologies may also help with other steps in the processing of hemp. New machines could perform additional functions that currently require auxiliary equipment, such as THC remediation and removing heavy metals. Skipping steps in processing would only add to the efficiency of operations, reducing costs and increasing speed of processing.

To bring this new technology into the American market, Sugarmade is working with Chinese manufacturers. The Chinese market is advanced in its approach to extraction, thanks to its reliance on essential oils for herbal medicines. For more than a thousand years, Chinese farmers have been cultivating and extracting essential oils from hemp. This expertise has led to an in-depth understanding of the process and the equipment needed to complete the task. Working with Chinese manufacturers could allow Sugarmade to provide its customer with more advanced and efficient technology.

Hemp processing needs to scale up. But just because eventual outputs need to be bigger doesn’t mean that bigger is necessarily better where machinery is concerned. In many cases, bigger may be just more expensive, whereas improved technology could bring real benefits.

Companies in Need of Processing

The pressure on processing capacity for hemp and related plants comes in part from the emergence of large companies in the sector. Among these is Canopy Growth Corporation (NYSE: CGC) (TSX: WEED), a leading player that has benefited from investment from other industries. The company has been steadily growing, including through the acquisition of a company making hemp skin-care products, creating demand for more CBD from within the company. To help meet this demand, it has been preparing another acquisition of Acreage Holdings Inc.

Another of the large Canadian companies with an interest in hemp and CBD, Aurora Cannabis Inc. (NYSE: ACB) (TSX: ACB) is exploring new ways in which these products can be of use. The company recently announced a partnership with mixed martial arts company UFC. As part of this arrangement, Aurora will explore ways in which its research and products might help athletes, whether in pain relief, dealing with the strains put on muscles, or helping with rest and relaxation. The partnership could help raise the company’s profile by association with an exciting sport and some of the world’s most impressive athletes.

Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON) is also looking for new approaches to CBD, with the creation of a recent R&D facility. While R&D work may only consume relatively small amounts of plants, its results include new products that could expand the market and increase demand for processing facilities. The company’s CEO, Mike Groenstein, has also been raising the profile of this work through a series of conference appearances, as the sector becomes better connected and interdependent.

The law around CBD and related products continues to evolve, and with it the products that can be sold. Aphria (NYSE: APHA) (TSX: APHA) is developing vaporization products in anticipation of changes in Canadian law later this year. As more states and countries bring in ever more liberal laws, product ranges should continue expanding, and with that growth will come the sector’s rising demand for equipment.

For more information on Sugarmade, visit Sugarmade Inc. (OTCQB: SGMD)

About CannabisNewsWire

CannabisNewsWire (CNW) is an information service that provides (1) access to our news aggregation and syndication servers, (2) CannabisNewsBreaks that summarize corporate news and information, (3) enhanced press release services, (4) social media distribution and optimization services, and (5) a full array of corporate communication solutions. As a multifaceted financial news and content distribution company with an extensive team of contributing journalists and writers, CNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. CNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today’s market, CNW brings its clients unparalleled visibility, recognition and brand awareness. CNW is where news, content and information converge.

Receive Text Alerts from CannabisNewsWire: Text “Cannabis” to 21000

For more information please visit https://www.CannabisNewsWire.com and or https://CannabisNewsWire.News

Please see full terms of use and disclaimers on the CannabisNewsWire website applicable to all content provided by CNW, wherever published or re-published: http://CNW.fm/Disclaimer

CannabisNewsWire (CNW)
Denver, Colorado
www.CannabisNewsWire.com
303.498.7722 Office
Editor@CannabisNewsWire.com

DISCLAIMER: CannabisNewsWire (CNW) is the source of the Article and content set forth above. References to any issuer other than the profiled issuer are intended solely to identify industry participants and do not constitute an endorsement of any issuer and do not constitute a comparison to the profiled issuer. The commentary, views and opinions expressed in this release by CNW are solely those of CNW. Readers of this Article and content agree that they cannot and will not seek to hold liable CNW for any investment decisions by their readers or subscribers. CNW is a news dissemination and financial marketing solutions provider and is NOT registered broker-dealers/analysts/investment advisers, hold no investment licenses and may NOT sell, offer to sell or offer to buy any security.

The Article and content related to the profiled company represent the personal and subjective views of the Author, and are subject to change at any time without notice. The information provided in the Article and the content has been obtained from sources which the Author believes to be reliable. However, the Author has not independently verified or otherwise investigated all such information. None of the Author, CNW, or any of their respective affiliates, guarantee the accuracy or completeness of any such information. This Article and content are not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action; readers are strongly urged to speak with their own investment advisor and review all of the profiled issuer’s filings made with the Securities and Exchange Commission before making any investment decisions and should understand the risks associated with an investment in the profiled issuer’s securities, including, but not limited to, the complete loss of your investment.

CNW HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.

This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected,” “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and CNW undertakes no obligation to update such statements.

Acquisitions Reveal the Steadily Changing Shape of the Cannabis Sector

CannabisNewsWire Editorial Coverage: The cannabis sector continues its steady shift toward big business, big money and a focus on the value add of immaterial assets.

TransCanna Holdings Inc. (CSE: TCAN) (FRA: TH8) (TCAN Profile) has made several key acquisitions, creating a large operation with various licenses and recognized brands. HEXO Corp. (TSX: HEXO) (NYSE American: HEXO) has taken a similar path with the acquisition of Newstrike. Canopy Growth Corporation (TSX: WEED) (NYSE: CGC) is building a positive public profile through releasing educational tools. Aphria Inc. (TSX: APHA) (NYSE: APHA) has expanded the hunt for cultivation licenses to Germany. Meanwhile, companies such as Charlotte’s Web Holdings Inc. (TSX: CWEB) (OTCQX: CWBHF) keep releasing new products into the market.

  • Cannabis companies are increasingly engaging in multimillion-dollar acquisitions.
  • These support a consolidation of the industry as it moves from scattered creativity to efficient large businesses.
  • The trend built in part on intangible assets, including brands and licenses.

To view an infographic of this editorial, click here.

A Very Different Business

The image of the cannabis industry varies hugely depending upon one’s point of view. To proponents, the market is a radical and transformative sector that’s bringing the world together. For opponents, it is one more vice threatening public morals. For many in the middle ground, it’s a space where hippies and stoners can thrive, though not one that encourages the buzz and dynamism of mainstream business.

In reality, the cannabis sector fits none of these images. The industry is emerging from its early, tentative steps into legality to become a significant business sector much like any other, with all the apparatus of modern capitalism and a focus on intangible assets such as intellectual property. All of this is reflected in the sector’s recent burst of mergers and acquisitions.

Big Money Deals

The most eye-catching aspect of mergers and acquisitions in the cannabis sector is the amount of money that goes into them. Take just two recent examples from a single company, TransCanna Holdings Inc. (CSE: TCAN) (FRA: TH8). In the past few months, the Vancouver-based cannabis company has made announcements on two major deals. First came the acquisition of a 196,000-square-foot vertically integrated cannabis facility for a total purchase price of $15 million. Then came a letter of intent relating to Californian company Lyfted Farms outlining TransCanna’s plans to acquire Lyfted’s business and assets for $5.5 million.

By the standards of some businesses, these might not seem like huge deals. But when a company is investing $20 million on expansion in the space of a couple of months, that certainly says something. That TransCanna can make these deals is a show not only of the strength of the company but also the strength of the industry.

The idea that there’s a lot of money in cannabis might not be surprising to anyone who’s seen TV depictions of the drug trade. Dramas such as Narcos show a world of high earners with big stacks of cash. But as sociologists such as Sudhir Venkatesh have shown, the reality for most people working in the illegal drug trade is vastly different. They earn less than minimum wage in jobs that are dangerous and uncertain.

The financial growth of the legal cannabis industry has therefore been a positive move for everyone from company leaders to their lowest-paid employees. The legalized trade is pulling money out of the black-market economy and allowing those at the top to earn big bucks while also providing employees with a decent wage. Far from weakening the power of legal providers, paying employees properly is leaving them with enough money to go around buying up competitors, as TransCanna is doing.

Success has also brought funds from outside. From private individuals to big alcohol and tobacco companies, investors are pouring money into pot, allowing businesses to expand while keeping their employees happy. There are living wages at the bottom and big money at the top.

Tidying Up the Market

The growth of the legal cannabis industry started with a scattershot approach. TransCanna is just one of many companies that have grown into the market from relatively small beginnings. Some began with entrepreneurs seeing a new industry within which to operate. Others were experienced cannabis cultivators moving from the illegal to the legal market. Still others were pharmaceutical companies dipping their toes into a new medicine and, from there, into the recreational industry.

As a result, the cannabis industry is cluttered with diverse and disconnected businesses. But now it’s moving on from this scatter-gun approach to a period of consolidation.

This doesn’t mean that the variety created in that early surge is being lost. When larger companies buy up smaller ones, it’s often with the aim of continuing the individual brands and styles the smaller companies have created. For example, TransCanna has announced the acquisition of GoodFellas, which will allow it to take control of the Daily Cannabis Goods brand. TransCanna CEO Jim Pakulis has talked not in terms of absorbing the Daily brand into TransCanna’s existing identity but in terms of maintaining Daily and expanding its sales.

The consolidation of multiple brands and businesses into a smaller number reflects a dialectic process that’s common in new business areas. First comes a burst of creativity. With few precedents and no big players dominating the market, entrepreneurs and creatives have free rein. Some of their experiments fail, but the ones that succeed get consumers interested and fill the market with ideas.

While this creates plenty of exciting idea and products, it’s also inefficient. In the phase that follows, bigger companies step in or emerge from among the smaller ones. Consolidation creates efficiency, providing more reliable products for consumers and better value for companies.

The contrasting approaches of small innovative companies and larger efficient ones together create excellent value. That’s the point the cannabis industry is now approaching and that TranCanna’s acquisitions are a part of.

The Power of the Immaterial

In the illegal market, all that mattered for cannabis sellers was the product. But in the legal market, things work differently. When a company can use the full apparatus of marketing, intangible assets such as intellectual property become important. That’s why GoodFellas is valuable to a company such as TransCanna — not just for its cannabis but for the Daily brand that’s attached to it.

And while intangible assets are normally talked about in terms of brand and IP, there’s another sort of asset that gets much less publicity and that the cannabis industry is bringing to investors’ attention: legal licenses.

Licenses of various sorts are important for a wide range of industries, from food production to mining. But they have a particular prominence in the cannabis industry because tight regulation has created a scarcity of licenses. When TransCanna subsidiary TCM Distribution Inc. gained cannabis manufacturing and distribution permits from the City of Adelanto, California, it was an important step in the company’s growth within the state. And when a deal like TransCanna’s acquisition of Lyfted is announced, the target’s cannabis licenses are often mentioned. These licenses are a crucial asset and one that investors are concerned about. Without the licenses, the business can’t function.

The prominence of licenses is a new feature of investment for those going into cannabis. But it could be a feature that helps investors recognize these assets in other companies. Cannabis companies are increasingly about immaterial assets, and immaterial assets are increasingly about licenses as well as IP.

Keeping Profiles High

In such an atmosphere, cannabis companies are working hard on keeping their profiles high while building up their portfolios of products.

Canadian cannabis company HEXO Corp. (TSX: HEXO) (NYSE American: HEXO) has, like TransCanna, been using acquisitions to build up its business. Originally a medical cannabis provider, HEXO joined the recreational market when Canada changed its laws last year. Since then, it has completed an acquisition of Newstrike, the parent company of Up Cannabis Inc, a licensed producer and distributor. It’s a deal that fits with the importance of immaterial assets. Licensing is important in Canada, both for production and distribution, and acquiring a company that is already licensed is the easiest way to expand a company’s footprint in the country.

Good publicity is another of the intangible assets that come with a good company, and few have achieved more publicity within the sector than Canopy Growth Corporation (TSX: WEED) (NYSE: CGC). When the company received a multibillion-dollar investment from Constellation Brands, it was the first time the sector had received such a big input of cash from outside, so the move drew substantial attention. Now the company is raising its profile in a different way, demonstrating its responsible attitude through the release of digital cannabis education tools.

Aphria Inc. (TSX: APHA) (NYSE: APHA) has taken the hunt for intangible assets global, with the acquisition of five cultivation licenses in Germany. With the North American cannabis industry increasingly well established, Europe is the next big frontier, and Aphria is racing in ahead of many of its competitors.

All this work on intangibles would be useless without physical products to go with it, and product innovation continues at a high pace. Charlotte’s Web Holdings Inc. (TSX: CWEB) (OTCQX: CWBHF) has recently announced the release of hemp-extract CBD gummies designed help with calm and sleep. CBD products are an increasingly important subsector of the market, and products of this kind have potentially wide reach.

The cannabis industry is changing, with big money, consolidation and growing intangible assets, but it remains grounded in a strong consumer desire for cannabis.

For more information on TransCanna Holdings, visit TransCanna Holdings Inc. (CSE: TCAN) (FRA: TH8)

About CannabisNewsWire

CannabisNewsWire (CNW) is an information service that provides (1) access to our news aggregation and syndication servers, (2) CannabisNewsBreaks that summarize corporate news and information, (3) enhanced press release services, (4) social media distribution and optimization services, and (5) a full array of corporate communication solutions. As a multifaceted financial news and content distribution company with an extensive team of contributing journalists and writers, CNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. CNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today’s market, CNW brings its clients unparalleled visibility, recognition and brand awareness. CNW is where news, content and information converge.

Receive Text Alerts from CannabisNewsWire: Text “Cannabis” to 21000

For more information please visit https://www.CannabisNewsWire.com and or https://CannabisNewsWire.News

Please see full terms of use and disclaimers on the CannabisNewsWire website applicable to all content provided by CNW, wherever published or re-published: http://CNW.fm/Disclaimer

CannabisNewsWire (CNW)
Denver, Colorado
www.CannabisNewsWire.com
303.498.7722 Office
Editor@CannabisNewsWire.com

DISCLAIMER: CannabisNewsWire (CNW) is the source of the Article and content set forth above. References to any issuer other than the profiled issuer are intended solely to identify industry participants and do not constitute an endorsement of any issuer and do not constitute a comparison to the profiled issuer. The commentary, views and opinions expressed in this release by CNW are solely those of CNW. Readers of this Article and content agree that they cannot and will not seek to hold liable CNW for any investment decisions by their readers or subscribers. CNW is a news dissemination and financial marketing solutions provider and is NOT registered broker-dealers/analysts/investment advisers, hold no investment licenses and may NOT sell, offer to sell or offer to buy any security.

The Article and content related to the profiled company represent the personal and subjective views of the Author, and are subject to change at any time without notice. The information provided in the Article and the content has been obtained from sources which the Author believes to be reliable. However, the Author has not independently verified or otherwise investigated all such information. None of the Author, CNW, or any of their respective affiliates, guarantee the accuracy or completeness of any such information. This Article and content are not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action; readers are strongly urged to speak with their own investment advisor and review all of the profiled issuer’s filings made with the Securities and Exchange Commission before making any investment decisions and should understand the risks associated with an investment in the profiled issuer’s securities, including, but not limited to, the complete loss of your investment.

CNW HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.

This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected,” “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and CNW undertakes no obligation to update such statements.

Demand for CBD Places Power in Hands of Extraction Providers

CannabisNewsWire Editorial Coverage: Extraction technology plays a crucial part in the production of cannabidiol (CBD) from hemp.

Sugarmade Inc. (OTCQB: SGMD) (SGMD Profile), a company already established in the hydroponic equipment business, is making plans to add extraction technology to its repertoire. Canopy Growth Corporation (NYSE: CGC) (TSX: WEED) has been researching new medical applications for CBD and related chemicals — medicines for which extraction will be critical. KushCo Holdings Inc. (OTCQX: KSHB) has moved from providing support services to CBD-related companies to running its own store and has recently bolstered its leadership team for further growth. Harvest Health & Recreation Inc. (CSE: HARV) (OTCQX: HRVSF) has expanded swiftly over the past six years, growing from a single operation to a presence in five U.S. states. And in a boost to CBD’s public profile, Aurora Cannabis Inc. (NYSE: ACB) (TSX: ACB) has teamed up with UFC to research the application of CBD and related treatments for mixed martial artists.

  • Extraction technology is not normally owned by the cultivators growing the crops.
  • The technology uses a range of different methods, utilizing substances such as ethanol and carbon dioxide.
  • The need to extract CBD oils allows extractors to take a substantial portion of hemp harvest profits.
  • Soaring demand for CBD has added to the profits for those providing extraction equipment.

To view an infographic of this editorial, click here.

Turning Hemp Into CBD

In the modern market, CBD is money, a sure seller that can be easily turned into cash by companies with even halfway capable supply chains and marketing. The incredible popularity of this hemp-derived substance has led to its use in medicines, foods, vaping oils, cosmetics and anything else manufacturers can think of.

But just as money doesn’t grow on trees, CBD doesn’t grow in the form of a pure oil that cultivators can just pick and put in a packet. The valuable commodity has to be extracted from hemp plants, a sophisticated process that involves expensive equipment and technical expertise. The need for that extraction work is fueling an important subsector of the hemp industry.

Extraction Efforts

The CBD industry is a complex one, with a range of companies providing different services at different places in the process. Key players include farmers and cultivators, who get most of the press attention; product developers and brand managers, who draw commercial attention onto products; and of course behind-the-scene companies such as Sugarmade Inc. (OTCQB: SGMD), which provides cultivation supplies. Perhaps the most overlooked element of the process — extraction — may be one of the most important in adding value.

All CBD extraction is achieved using a type of solvent. This chemical is mixed with the prepared hemp plants in carefully controlled conditions within specialist machines. The solvent attaches to the CBD and draws it out of the plant. The machinery then separates the solvent-CBD mix from the rest of the hemp remains, and then extracts the CBD from the solvent. The aim is to complete this extraction process as quickly, efficiently and affordably as possible. The ideal extraction system draws all of the CBD from the plant, though it is seldom possible to get 100%; even high-grade ethanol extraction equipment works at 98.5%.

A number of different solvents are used. Carbon dioxide, butane and ice water are among the options. The one favored by many companies, including Sugarmade, is ethanol extraction, in which alcohol detaches CBD from hemp as easily as it extracts common sense from a student on a Saturday night.

Because CBD is essentially useless until it has been extracted, a delicate balance exists in the relationship between farmers and extractors. Growing a crop of hemp takes months, during which the plants are carefully fed, watered and monitored to ensure the best possible harvest. The valuable crop is then taken to the extraction company, which might process the entire crop in a matter of days. Right now, extraction technology is in short supply and high demand, so the extraction companies can take up to 60% of the CBD or its value as a processing fee — a highly profitable outcome for the minority of the work.

This imbalance appears certain to change. While the number of hemp growers has risen dramatically recently, the number of extraction operations has not. Clearly, the time has come for extraction operations to catch up, both in the number available and in the scope of their processing. This obvious need is what Sugarmade is working on as the savvy company makes a move into the market.

As with its previous work in cultivation, Sugarmade isn’t going into extraction itself — at least not yet. Instead, the company is preparing to provide state-of-the-art extraction equipment. Move is designed to allow more companies to get involved in this lucrative piece of the CBD trade. As more companies get involved and existing operations grow larger, supply should push down prices, meaning a better deal for cultivators.

A change looks to be imminent in the CBD industry. But how did this extraction bottleneck arise?

The CBD Rush

The answer lies in the extraordinary growth of the CBD industry. Barely even a novelty talking point a decade ago, CBD has seen its profile soar in recent years. In the health and well-being sector in particular, CBD has become the new wonder ingredient, the elixir that customers want and retailers are eager to provide. The key component is used to tackle problems such as pain, insomnia and anxiety, and is also used in relaxing vaping oils and edibles.

CBD was given a boost in December when the U.S. government legalized its production on the federal level. Previously produced under state-level licenses, CBD was grown in an uncomfortable legal area, with federal constraints making business complicated. With the change in the legal status of this crop, cultivators are making the most of a CBD rush.

But despite the best efforts of companies such as Sugarmade, supply of CBD isn’t keeping up with demand. It’s been less than a year since laws making production easier were introduced in both the United States and Canada, and the industry is working feverishly to catch up. In many areas, companies can’t obtain enough CBD to keep up with what their customers want.

This supply-vs.-demand problem is exacerbating the power imbalance between cultivators and extractors. Working to meet the mounting demand — a demand that appears certain to only continue its upward trend—cultivators are eager to obtain CBD as quickly as possible and move it on to market. This forces them to accept the rates offered by extractors. But fortunately, as is often the case, the trend is forcing change.

The same legal changes that have created greater demand and greater cultivation make it easier for companies to move into or expand their extraction business. Supply chains are becoming better established both for CBD and for the equipment involved in its processing. The provision of more extraction equipment, regardless of the solvent used, will remove the bottleneck and allow the CBD to flow free.

CBD Spreads

The growth of the CBD market has both encouraged and been driven by the success of companies working in the field.

Canopy Growth Corporation (NYSE: CGC) (TSX: WEED) is one of the largest companies working with CBD, in part thanks to a multibillion-dollar investment from drinks manufacturer Constellation Brands. Already a leading player in the market before the Constellation deal, Canopy Growth has seen its profile and business go from strength to strength. But while that deal drew attention to the recreational side of the company’s work, and it has recently made a move in skin care through acquisition of This Works, Canopy Growth’s core focus is still on medicine. The company’s research division recently provided an update on its work, which includes the development of a whole range of medicines that include CBD.

Like Sugarmade, KushCo Holdings Inc. (OTCQX: KSHB) first moved into the CBD space as a support company, providing packaging solutions. The company has since moved to a more central position, with an online store for CBD and related products. And to ensure continued high-quality leadership, the company recently bolstered its leadership team.

Founded by a former lawyer in 2013, Harvest Health & Recreation Inc. (CSE: HARV) (OTCQX: HRVSF) provides CBD-related products in the United States. The company has shown an eagerness to expand, already spreading from a single location to five states in the space of six years. Harvest also has a focus on education and information that reflects the community-minded approach of many businesses within the sector.

One of the companies that has seen the greatest growth is Aurora Cannabis Inc. (NYSE: ACB) (TSX: ACB), which has profited from Canada’s liberal drug laws. Aurora has become heavily involved in research, looking at new treatments that can be produced with CBD. The company has even partnered with mixed martial arts company UFC to explore how its products and discoveries can help consumers.

All of these companies rely on extraction technology to create products that use CBD. Growth in the extraction industry and better provision of its technology will provide a boost for many of them as the CBD market grows.

For more information on Sugarmade, visit Sugarmade Inc. (OTCQB: SGMD)

About CannabisNewsWire

CannabisNewsWire (CNW) is an information service that provides (1) access to our news aggregation and syndication servers, (2) CannabisNewsBreaks that summarize corporate news and information, (3) enhanced press release services, (4) social media distribution and optimization services, and (5) a full array of corporate communication solutions. As a multifaceted financial news and content distribution company with an extensive team of contributing journalists and writers, CNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. CNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today’s market, CNW brings its clients unparalleled visibility, recognition and brand awareness. CNW is where news, content and information converge.

Receive Text Alerts from CannabisNewsWire: Text “Cannabis” to 21000

For more information please visit https://www.CannabisNewsWire.com and or https://CannabisNewsWire.News

Please see full terms of use and disclaimers on the CannabisNewsWire website applicable to all content provided by CNW, wherever published or re-published: http://CNW.fm/Disclaimer

CannabisNewsWire (CNW)
Denver, Colorado
www.CannabisNewsWire.com
303.498.7722 Office
Editor@CannabisNewsWire.com

DISCLAIMER: CannabisNewsWire (CNW) is the source of the Article and content set forth above. References to any issuer other than the profiled issuer are intended solely to identify industry participants and do not constitute an endorsement of any issuer and do not constitute a comparison to the profiled issuer. The commentary, views and opinions expressed in this release by CNW are solely those of CNW. Readers of this Article and content agree that they cannot and will not seek to hold liable CNW for any investment decisions by their readers or subscribers. CNW is a news dissemination and financial marketing solutions provider and is NOT registered broker-dealers/analysts/investment advisers, hold no investment licenses and may NOT sell, offer to sell or offer to buy any security.

The Article and content related to the profiled company represent the personal and subjective views of the Author, and are subject to change at any time without notice. The information provided in the Article and the content has been obtained from sources which the Author believes to be reliable. However, the Author has not independently verified or otherwise investigated all such information. None of the Author, CNW, or any of their respective affiliates, guarantee the accuracy or completeness of any such information. This Article and content are not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action; readers are strongly urged to speak with their own investment advisor and review all of the profiled issuer’s filings made with the Securities and Exchange Commission before making any investment decisions and should understand the risks associated with an investment in the profiled issuer’s securities, including, but not limited to, the complete loss of your investment.

CNW HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.

This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected,” “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and CNW undertakes no obligation to update such statements.

CBD Surge Puts Pressure on Cultivation Supplies

CannabisNewsWire Editorial Coverage: Growing demand for CBD is increasing pressure on companies that provide key cultivation equipment and industry supplies.

As part of its commitment to build a large and well-supplied sales channel, hydroponic supplier Sugarmade Inc. (OTCQB: SGMD) (SGMD Profile) is in the process of making acquisition of companies that supply the hemp industry. An increasing need for supplies is coming from companies such as Canopy Growth Corporation (TSX: WEED) (NYSE: CGC), a major cultivator and processor making moves on the CBD drinks and well-being markets. Cronos Group Inc. (TSX: CRON) (NASDAQ: CRON) has entered into a supply agreement with another provider to ensure the materials it needs for its products. Global efforts by companies such as New Age Beverages Corporation (NASDAQ: NBEV) and Aphria (TSX: APHA) (NYSE: APHA) may further strain U.S. supply chains, due to greater cultivation restrictions in other parts of the world.

  • Many hemp growers use hydroponic techniques for indoor propagation.
  • These techniques allow greater control over genetics and produce higher quality plants.
  • The extraordinary rise in the North American cannabis sector is creating unprecedented demand.
  • Suppliers are responding with growth and mergers.

To view an infographic of this editorial, click here.

CBD Popularity Pushes Agricultural Supply and Demand

The popularity of CBD is creating new trends in the agricultural supply sector. Thanks to legal changes in Canada and the United States, farmers and agricultural companies are rushing to increase production of hemp and other CBD-bearing plants. For some, this involves a shift from growing other crops to hemp, as struggling farmers chase the profits promised by the sector. For others, it means expanding existing hemp production to make the most of the staggering rise in demand.

This concentrated movement is fueling demand for equipment, in particular the specialist equipment used for indoor growing. The agricultural supplies industry faces the possibility of real shortages, and companies that act to solve that problem by meeting the need could seize upon a chance to make this moment work for them.

Hydroponic Agriculture — Is a Supply Shortage Looming?

Growing hemp is a sophisticated business. Aside from the legal, licensing and security issues surrounding the process, growers need specialist equipment and seeds or clones from which to grow crops. It’s on the equipment side that companies such as Sugarmade Inc. (OTCQB: SGMD) are getting involved.

Sugarmade has moved into hemp equipment from another support sector — restaurant supplies and packaging. As with its more recent work, the company didn’t make its mark in the restaurant world by providing products directly to customers, but rather by providing businesses with the materials they needed to get their products out into the world. It may not be as glamorous or high profile as producing the end product itself, but the supporting the backend of the business is vital to keeping those industries going.

With the dramatic expansion of interest in CBD over the past few years, Sugarmade has taken the opportunity to diversify its work. Still focused on growth through brand expansion and acquisition, the company is now making those expansion and acquisition moves in the Hemp sector, where it provides cultivation equipment and supplies.

There are two approaches to growing hemp: outdoor cultivation using soil and indoor cultivation using hydroponic equipment. The choice often means the difference between quantity and quality of plants, with the latter increasingly dominant because of the improved reliability of supplies.

Providers of hydroponic equipment such as Sugarmade have therefore seen a surge in business from hemp growers. As cultivators look to increase their hemp harvest, they also need to increase the size and effectiveness of their growing spaces, and that means a higher demand for equipment.

The Benefits of Hydroponics

Hydroponics is a catch-all term for a number of indoor growing techniques. Sometimes the plants are grown in an inert layer that substitutes for soil, providing something for the roots to grow through. In other approaches, such as deep-water culture and nutrient-film techniques, plants that would naturally grow in soil are instead grown in liquid settings, with their roots floating free. Aeroponics goes a step beyond this, with the roots exposed and fed by sprays of artificial mist.

What each of these approaches have in common is that food for the crop is provided in the form of nutrient solutions direct available to the plants’ roots, instead of those plants having to take nutrition from the soil. This technique gives growers more control over what goes into their plants. Because hydroponic cultivating takes place indoors, farmers also gain greater control over the conditions in which the plants live, including temperatures and quantity and quality of light. Together, this allows for more consistent, higher quality growth, which can also be tailored to increase the quantity of CBD in a plant. It’s that quality and consistency that drives demand for the products offered by companies such as Sugarmade.

Sugarmade provides a wide range of products. These include equipment needed for setup, nutrients used to feed the plants, lighting systems and tools for testing the quality of the environment, which are essential to getting the desired results. The surge in demand caused by rising interest in CBD has put serious pressure on hydroponic suppliers. There have been reports of extensive back ordering and customers having to wait for supplies to come in. In a fast-growing industry where new or expanding cultivators are rushing to establish their positions, that could become a serious problem.

So what are supply companies doing to prevent an equipment shortage?

Ensuring Flow of Hydroponic Supplies

It might sound obvious, but one of the answers is larger businesses. Companies such as Sugarmade are dramatically expanding their operations, thus seeing an increased level of power over their supply chains and the capacity to both stock and sell greater volumes of agricultural equipment. The efficiencies and reach of larger companies, along with their financial capacity to order supplies in larger volumes, will invigorate the hydroponic supply chain and ensure that growers’ needs are met.

To support this goal, companies have been undertaking mergers and acquisitions. Sugarmade has made two such moves — and the company isn’t stopping there. As CEO Jimmy Chan said, “Sugarmade is expecting to realize exceptional revenue growth this year from all of our hydroponic-related market sectors. . . . We continue to seek additional acquisitions to further boost our already-expected robust revenue growth rate.”

Scale brings advantages beyond efficiency. Larger companies can provide a wider range of products, and so cater to the needs of cultivators trying out different hydroponic techniques. This supports innovation in hemp cultivation, as equipment from a single supplier can be used to experiment with best practices, from inert beds and water flows to aeroponics. Variety of resources also allows growers to experiment with their nutrient mix, thus obtaining the best possible results from their plants.

By providing a large supply base and a wide range of products, Sugarmade is helping to tackle equipment shortages and get hemp growers up and running.

Relying on Hydroponics

Hydroponics are now feeding into a huge sector growing hemp and other CBD-bearing plants.

One of the biggest companies in the space is Canopy Growth Corporation (TSX: WEED) (NYSE: CGC). Already a major player, the company’s purchasing power has been further expanded over the past two years by billions in investment from drinks giant Constellation Brands. This is seen as part of a wider trend of companies looking to produce CBD drinks, which could create yet another surge in demand for hemp and the equipment to cultivate it. Canopy Growth is currently pushing forward with a multifaceted hemp and CBD strategy and, as part of that focus, has acquired skincare and well-being company This Works.

The equipment needed by the CBD industry isn’t just about agriculture. The founding of a new R&D facility by Cronos Group Inc. (TSX: CRON) (NASDAQ: CRON) appears to be good news for companies equipping biotech researchers. In addition, Cronos has also entered a supply agreement to ensure a steady flow of concentrates needed for its products, ahead of changes in rules on foodstuffs that will expand the market in Canada later this year.

While much attention is on North America, New Age Beverages Corporation (NASDAQ: NBEV) announced in April its push to become a global brand. Selling CBD products including oils, creams and lotions, as well as its specialist beverages, the company is targeting an international customer base increasingly interested in the potential of CBD. Only three years old, New Age Beverages is already making a splash with its vibrant brand and growing product range.

Aphria (TSX: APHA) (NYSE: APHA) is also expanding globally, with the introduction of CannRelief, a CBD product line targeting Germany. The emergence of a European market is likely to increase demand for CBD from North America, at least in the short term, as many European countries have not yet seen legal changes to ease the production of CBD.

With CBD demand growing around the world, demand for cultivation supplies is also increasing. Companies that put in the work to expand their supply channels may establish profitable ongoing relationships with a new generation of hemp cultivators.

For more information on Sugarmade, visit Sugarmade Inc. (OTCQB: SGMD)

About CannabisNewsWire

CannabisNewsWire (CNW) is an information service that provides (1) access to our news aggregation and syndication servers, (2) CannabisNewsBreaks that summarize corporate news and information, (3) enhanced press release services, (4) social media distribution and optimization services, and (5) a full array of corporate communication solutions. As a multifaceted financial news and content distribution company with an extensive team of contributing journalists and writers, CNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. CNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today’s market, CNW brings its clients unparalleled visibility, recognition and brand awareness. CNW is where news, content and information converge.

Receive Text Alerts from CannabisNewsWire: Text “Cannabis” to 21000

For more information please visit https://www.CannabisNewsWire.com and or https://CannabisNewsWire.News

Please see full terms of use and disclaimers on the CannabisNewsWire website applicable to all content provided by CNW, wherever published or re-published: http://CNW.fm/Disclaimer

CannabisNewsWire (CNW)
Denver, Colorado
www.CannabisNewsWire.com
303.498.7722 Office
Editor@CannabisNewsWire.com

DISCLAIMER: CannabisNewsWire (CNW) is the source of the Article and content set forth above. References to any issuer other than the profiled issuer are intended solely to identify industry participants and do not constitute an endorsement of any issuer and do not constitute a comparison to the profiled issuer. The commentary, views and opinions expressed in this release by CNW are solely those of CNW. Readers of this Article and content agree that they cannot and will not seek to hold liable CNW for any investment decisions by their readers or subscribers. CNW is a news dissemination and financial marketing solutions provider and is NOT registered broker-dealers/analysts/investment advisers, hold no investment licenses and may NOT sell, offer to sell or offer to buy any security.

The Article and content related to the profiled company represent the personal and subjective views of the Author, and are subject to change at any time without notice. The information provided in the Article and the content has been obtained from sources which the Author believes to be reliable. However, the Author has not independently verified or otherwise investigated all such information. None of the Author, CNW, or any of their respective affiliates, guarantee the accuracy or completeness of any such information. This Article and content are not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action; readers are strongly urged to speak with their own investment advisor and review all of the profiled issuer’s filings made with the Securities and Exchange Commission before making any investment decisions and should understand the risks associated with an investment in the profiled issuer’s securities, including, but not limited to, the complete loss of your investment.

CNW HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.

This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected,” “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and CNW undertakes no obligation to update such statements.

Celebrity Attention Fuels Rising Press Profile of CBD

CannabisNewsWire Editorial Coverage: Companies with a presence in the CBD market are seeing their profiles rise, thanks to growing media and celebrity attention.

Wildflower Brands Inc. (CSE: SUN) (OTCQB: WLDFF) (WLDFF Profile) is one of the companies benefiting most from this attention, with its products featured in Kim Kardashian’s baby shower and the new Saks CBD store. Tilray Inc. (NASDAQ: TLRY) has seen strong market coverage as its shares rose following action to tackle product shortages in Canada. Canopy Growth Corporation (NYSE: CGC) (TSX: WEED) has fostered its public profile through efforts by the company’s media-savvy co-CEO. Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON) drew attention as its share value rose with a large external investment. Charlotte’s Web Holdings Inc. (OTCQX: CWBHF) (CSE: CWEB) has been focusing on growing better CBD-producing plants, work that has drawn attention to its VP of cultivation.

  • Kim Kardashian’s CBD-themed baby shower drew attention to the range of relaxing CBD products.
  • Other high-profile appearances are boosting upper-end CBD brands.
  • Broad media coverage is normalizing and drawing customers to the sector.

To view an infographic of this editorial, click here.

CBD Whips Up Media Storm

Recent months have seen CBD in the media spotlight more than ever before. The relaxing natural compound, derived from hemp and cannabis plants but without the psychoactive qualities of THC, has been grabbing attention across the internet and in print and broadcast media. What was a fringe interest only a few years ago has now grown into the subject of huge mainstream attention.

Some of the coverage comes in news and opinion pieces, where the recent legalization of hemp in the United States has driven a surge in interest. But with CBD products on sale in a growing number of shops across a growing number of states, attention has also come from fashion and lifestyle writers. Even celebrities are in on the act, with CBD products appearing in the hands of the rich and famous — a seemingly sure omen of popularity in the media age.

Garnering Celebrity Support

One of the brands that has benefited strongly from this flurry of media attention is Wildflower Brands Inc. (CSE: SUN) (OTCQB: WLDFF), a creator of health and wellness products. Headquartered in Vancouver, British Columbia, Wildflower has reached out of Canada and into the United States as North America has become increasingly hospitable to CBD products. The company is focused on building brands around plant-based products, appealing to those looking for natural way to relax and be healthy.

CBD is an important part of Wildflower’s stable of brands. Its Wildflower Wellness brand provides capsules, tinctures, vaporizing liquid and other CBD-infused products, all designed to support relaxation, health and wellness. With its combination of effectiveness and natural products, the brand is, like many others in the CBD sphere, designed to appeal to those looking to escape the stresses of modern life.

That’s presumably how Wildflower products came to appear at Kim Kardashian’s recent baby shower. Kardashian and her husband, Kanye West, recently welcomed their fourth child — and second born by surrogate. In preparation for the event, Kardashian threw an extravagant and well-reported baby shower. To help her guests escape the stresses of life and to prepare her celebrate the “calm before the baby storm,” the celebrity themed her baby shower around the relaxing power of CBD. The event included such tranquil activities as massages, flower arranging and mixing CBD oils to create personalize shower gifts.

As part of the event, Kardashian encouraged her guests to enjoy a relaxing puff of CBD, and Wildflower’s vaporizing products were on hand to provide this opportunity. A Wildflower vaporizer appeared in pictures from the party, as celebrities made the most of what CBD has to offer.

This isn’t the first time that Wildflower products have found their way into celebrity hands. Wildflower goods were selected for inclusion in the 2019 Four Seasons Hotel Hollywood Swag Bags, given to nominees, presenters and actors staying at the hotel for this year’s Oscars. With CBD becoming not just acceptable but fashionable, Wildflower was a natural fit for a hotel wanting to make a good impression on its celebrity guests.

The image of CBD as a prestigious, high-profile consumer luxury has been further reinforced by the creation of a CBD shop within the shop at Saks Fifth Avenue. Directly connecting CBD with other high-end brands and the concept of luxury shopping, this move firmly stakes out CBD’s place within the luxury goods market. And once again, Wildflower is visible among the products on display.

Media Eyes Up CBD

This move into the celebrity culture and the high-end shopping market has come alongside growing media attention for CBD brands.

The arrival in Los Angeles of prominent Long Island beauty boutique Botanica Bazaar gave Vogue reason to cover a range of products including CBD tinctures. For this part of the article, the magazine focused on Wildflower’s products. The company’s strongest CBD remedies, its tinctures have been designed to counter one of the big problems with cannabinoid products — the sometimes unpleasant taste. Wildflower has tackled this challenge by adding natural flavorings to create a product that’s recognized for its flavor as well as its relaxing qualities.

The Vogue piece garnered positive coverage for CBD in general, with Botanica Bazaar’s owners talking about how the pain-relieving power of these products had won a growing number of loyal customers. The article also provided positive coverage for Wildflower, with the writers noting that “Wildflower’s CBD tinctures and vapes not only kill the aesthetics game, but also taste good.”

Coverage of broader cannabis culture has brought CBD brands to the attention of a receptive audience. When Vice presented an article on the best female-owned brands in the cannabis sector, the magazine included Wildflower in a section on pain-relieving spa products. A pain-relief product designed to tackle muscle, joint and back pain, the CBD+ Healing Stick was recommended in the article as a useful cure for period pain.

Buzzfeed went so far as to publish an article on why readers should be buying CBD Christmas gifts for everyone, including featuring recommendations for products their readers might want to pick. These included a lip butter, truffles and CBD-infused sparkling water, showing the wide range of options now available to the CBD consumer.

Wildflower once again stole some of the limelight. The company’s disposable CBD vaporizer pen proved too good a novelty to leave out of the selection. All in all, the company has received mention in more than 15 different articles and media pieces, touting Wildflower products and singing the praises of CBD in general.

CBD’s Growing Press Presence

It seems like hemp and CBD can’t help but make news.

Canadian company Tilray Inc. (NASDAQ: TLRY), a world leader in the field of cannabis and cannabinoids, hit the headlines in Investor’s Business Daily after it announced its stock had jumped based on first-quarter sales. Like many companies in Canada, Tilray has been struggling to meet demand following the legalization of recreational cannabis. However, the company has responded swiftly to the supply shortage, investing $32.6 million to expand it cultivation and manufacturing space by nearly 20%, a move that should keep its profile high.

Another of the big cannabis companies, Canopy Growth Corporation (NYSE: CGC) (TSX: WEED) has built up its profile partly through the work of co-CEO Mark Zekulin. The more outward-facing of the company’s two CEOs, Zekulin has courted public attention through media appearances such as a recent interview with Market Watch. The fact that Canopy Growth is one of the biggest cannabis companies in one of the biggest cannabis markets doesn’t hurt either. This drew the attention of drinks giant Constellation Brands, which invested billions in the company with an eye to products such as CBD drinks; the move made headlines across the business world. A push into the United States with a new hemp-growing facility in New York state has further raised the company’s public profile.

Some of the media coverage around cannabis and CBD has an air of incredulity to it. When Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON) saw its share price rise despite first-quarter losses, it inevitably drew attention from market commentators. An investment of C$2.4 billion from tobacco giant Altria is undoubtedly a major factor in the company’s strong performance despite setbacks. Such investments promise future developments, and market commentators watch eagerly to see what will happen next.

Within the United States, CBD producer Charlotte’s Web Holdings Inc. (OTC: CWBHF) (CSE: CWEB) has gained attention as a business with an unpretentious brand and a strong scientific grounding to its products. Using proprietary genetics, the company is working to produce high-quality, low-cost hemp to meet the demands of an increasingly large market. Charlotte’s Web has also won attention for its vice president of cultivation, Jared Stanley, who was recently featured in a list of the hundred most influential figures in the cannabis industry.

As CBD’s cultural presence grows, companies with a strong media presence and the attention of celebrities seem certain to benefit.

For more information on Wildflower Brands, visit Wildflower Brands Inc. (CSE: SUN) (OTCQB: WLDFF)

About CannabisNewsWire

CannabisNewsWire (CNW) is an information service that provides (1) access to our news aggregation and syndication servers, (2) CannabisNewsBreaks that summarize corporate news and information, (3) enhanced press release services, (4) social media distribution and optimization services, and (5) a full array of corporate communication solutions. As a multifaceted financial news and content distribution company with an extensive team of contributing journalists and writers, CNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. CNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today’s market, CNW brings its clients unparalleled visibility, recognition and brand awareness. CNW is where news, content and information converge.

Receive Text Alerts from CannabisNewsWire: Text “Cannabis” to 21000

For more information please visit https://www.CannabisNewsWire.com and or https://CannabisNewsWire.News

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CannabisNewsWire (CNW)
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www.CannabisNewsWire.com
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DISCLAIMER: CannabisNewsWire (CNW) is the source of the Article and content set forth above. References to any issuer other than the profiled issuer are intended solely to identify industry participants and do not constitute an endorsement of any issuer and do not constitute a comparison to the profiled issuer. The commentary, views and opinions expressed in this release by CNW are solely those of CNW. Readers of this Article and content agree that they cannot and will not seek to hold liable CNW for any investment decisions by their readers or subscribers. CNW is a news dissemination and financial marketing solutions provider and is NOT registered broker-dealers/analysts/investment advisers, hold no investment licenses and may NOT sell, offer to sell or offer to buy any security.

The Article and content related to the profiled company represent the personal and subjective views of the Author, and are subject to change at any time without notice. The information provided in the Article and the content has been obtained from sources which the Author believes to be reliable. However, the Author has not independently verified or otherwise investigated all such information. None of the Author, CNW, or any of their respective affiliates, guarantee the accuracy or completeness of any such information. This Article and content are not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action; readers are strongly urged to speak with their own investment advisor and review all of the profiled issuer’s filings made with the Securities and Exchange Commission before making any investment decisions and should understand the risks associated with an investment in the profiled issuer’s securities, including, but not limited to, the complete loss of your investment.

CNW HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.

This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected,” “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and CNW undertakes no obligation to update such statements.

Hemp Companies Move to Tackle CBD Shortfall

CannabisNewsWire Editorial Coverage: A boom in demand for cannabidiol (CBD) has created an alarming shortage, which savvy hemp companies are aggressively looking to solve.

Cultivation supplies company Sugarmade Inc. (OTCQB: SGMD) (SGMD Profile) has acquired several other suppliers, allowing it to benefit from economies of scale. Canadian cultivator Tilray Inc. (NASDAQ: TLRY) is investing heavily in new growing space. Canopy Growth Corporation (NYSE: CGC) (TSX: WEED) has expanded from Canada into the United States and is collaborating with other companies to meet demand. Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON) has received a substantial inflow of funds from a tobacco company and is investing some of it in R&D. Charlotte’s Web Holdings Inc. (OTCQX: CWBHF) (CSE: CWEB) is focusing on growing high-quality hemp to supply a range of novel products.

To view an infographic of this editorial, click here.

  • Demand for CBD has soared thanks to consumer interest.
  • Legalization nationally in the United States through the farm bill has led to more cultivators and a rising demand for cultivation supplies.
  • Companies are rising to meet these supply challenges through expansion, consolidation and innovation.

CBD and the Challenge of Demand

The ability to meet customer demand is one of the fundamental challenges for any industry. If businesses can’t keep up with demand, they don’t just miss out on an immediate opportunity for profit, they risk losing the attention of customers in the long term.

For a relatively new product such as CBD, that problem is particularly acute. Though demand for the product is currently high, the industry is not well established, making it critical that companies reinforce customer habits through supplying the products they’re seeking. Being new, however, makes the supply problem particularly challenging, as production techniques and supply pipelines are not fully developed for massive consumption. The future of the industry will depend upon which companies are able to meet this demand and how they do it.

The CBD Boom

The CBD industry has seen a staggering boom in the past. This growth has created opportunities for companies such as brand expansion and acquisition firm Sugarmade Inc. (OTCQB: SGMD), which is making a strong play into the sector, as well as new companies focused purely on CBD.

The demand for CBD is easy to explain. Recent research into its uses has suggested that this naturally occurring compound can be useful in a range of health and well-being roles, including managing pain and helping users to relax. This compelling research has naturally drawn the attention of customers seeking new options to improve the way they feel, especially those consumers who prefer to avoid heavily processed chemicals.

Publicity around CBD has further raised demand. Some of this attention comes from emerging CBD companies, whose marketing efforts have raised the profile not just of their own brands but of the sector as a whole. Additional exposure has come from the battle to make hemp cultivation legal across the United States. Because hemp provides most of the available CBD, this process also brought hemp production into the public spotlight. Companies such as Sugarmade found their businesses attracting far more attention — so more demand.

This demand culminated with the passage of the 2018 Farm Bill. Signed into law just before Christmas, the bill legalized the production of hemp on a national level. This makes hemp production a far more straightforward and reliable source of income, and will allow more farmers to benefit from a profitable cash crop. As companies rush to enter the sector or expand production in response to the bill, demand for the services and equipment they need has soared. As a provider of the hydroponic cultivation supplies on which many hemp farmers depend, Sugarmade and its pending acquisition subsidiaries — AthenaUnited.com and Zenhydro.com — has found itself swamped with orders.

Shortage of CBD

This surge in demand following the farm bill has created an undeniable opportunity within the CBD sector — along with a challenge. Fortunately for Sugarmade, it’s a challenge that they appear to be instrumental in solving.

Hemp cultivators are currently unable to provide the volume of plants that customers want. One of the reasons is that the cultivation, processing and supply systems simply aren’t large enough. The CBD industry was already on an expansion path as it tried to meet growing demand before the farm bill. Now with that demand growing further, it’s going to take time and a big push to achieve what people are after. Making an industry legal doesn’t make it magically appear.

Then there’s the unreliability of the CBD levels in hemp. The chemical content of the plants is small and hugely variable. Relatively small shifts in the makeup of a crop can have a significant impact on how much CBD is produced.

Cultivating larger, more reliable crops is vital to the future of the industry. Manufacturers are eager to rise to that challenge. However, to do so they need to get the supplies to get them off the ground, including hydroponic systems, feed chemicals and the clippings, or clones, from which much hemp is grown.

Looking at the effect of this shortage in just one state, Sugarmade CEO Jimmy Chan was optimistic about the effect on his company. “With at least 42,000 acres of hemp expected to be planted in Kentucky and considering an average plant density per acre of well over 1,000, farmers in Kentucky will need hundreds of millions of clones over the coming years,” he said. “When these numbers are multiplied over the many other hemp cultivation states, it is easy for anyone to see the strong demand scenario that is quickly developing.”

Responding to the Shortage

To meet the demand for CBD, hemp cultivators will clearly need to improve both the quantity and the quality of their crops.

It’s easy to see how an increase in quantity will have knock-on effects for suppliers such as Sugarmade. The company’s pending acquisition subsidiaries AthenaUnited.com and ZenHydro.com are seeing orders for their cloning supplies skyrocket, with backorders building up as they rush to meet unprecedented demand.

The search for more reliable levels of CBD is also contributing to this demand. Hydroponic systems give cultivators control over the growing process. By experimenting with hydroponics and controlling the light, plant food and environment, cultivators can find ways to grow plants with predictable and higher levels of CBD. This experimentation will create even more demand for hydroponic materials. Sugarmade should be central to the improvement of these processes.

To provide supplies as efficiently and profitably as possible, Sugarmade has gone through a period of expansion, acquiring other companies in the hydroponics and CBD sector. This model of consolidation is being repeated across the industry as businesses seek efficiencies of scale.

“Sugarmade plans to integrate these businesses fully as soon as is possible, making us one of the larger suppliers to this growing marketplace,” stated Chan. “Additionally, we are in process of vetting other possible acquisitions to further enhance our portfolio of hydroponic and cultivation supply products. We are certainly excited about our prospects for the remaining part of this year and into next year.”

Expanding Potential

Sugarmade isn’t the only CBD-related company using acquisitions to expand potential. Canadian company Tilray Inc. (NASDAQ: TLRY) has undertaken a series of acquisitions, including Manitoba Harvest, the world’s largest hemp foods company, to strengthen its position in hemp. The company has responded decisively to the recent supply shortage in hemp and related plants in North America, in part by investing $32.6 million to significantly expand it production space across three sites, increasing its cultivation and manufacturing footprint by nearly 20%.

Another of the big Canadian companies, Canopy Growth Corporation (NYSE: CGC) (TSX: WEED) has opted into investing south of the border thanks to the farm bill. The company has set up a hemp-growing facility in New York state and acquired another hemp company, AgriNextUSA. Canopy Growth has also been collaborating with other CBD and related companies to boost their shared output. One collaboration with PharmHouse has seen Canopy Growth provide high-quality genetic stock to PharmHouse’s growing facility. In return, Canopy Growth will benefit from an offtake agreement to obtain flowers from the plants PharmHouse is growing.

Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON) has benefited from attention on the sector through a huge injection of outside cash. Tobacco giant Altria has agreed to invest C$2.4 billion in Cronos Group, providing the company behind Marlboro with a way into a new sector. Fittingly, Cronos Group is investing some of its funds in a new R&D facility that will work on vaporizer products. Vaping has become a popular way of consuming CBD, so the investment may allow Cronos to benefit from the market from multiple angles.

American CBD producer Charlotte’s Web Holdings Inc. (OTCQX: CWBHF) (CSE: CWEB) has been using proprietary genetics to work toward the goal of high-quality, low-cost hemp. The company has also been creating innovative new products to make use of the growth in CBD. Its recently expanded pet line offers the promise of calming dogs and easing joint pain brought on by age.

Rising demand for CBD has created a challenge, but it’s a challenge that smart companies are definitely ready to meet.

For more information on Sugarmade, visit Sugarmade Inc. (OTCQB: SGMD)

About CannabisNewsWire

CannabisNewsWire (CNW) is an information service that provides (1) access to our news aggregation and syndication servers, (2) CannabisNewsBreaks that summarize corporate news and information, (3) enhanced press release services, (4) social media distribution and optimization services, and (5) a full array of corporate communication solutions. As a multifaceted financial news and content distribution company with an extensive team of contributing journalists and writers, CNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. CNW has an ever-growing distribution network of more than 5,000 key syndication outlets across the country. By cutting through the overload of information in today’s market, CNW brings its clients unparalleled visibility, recognition and brand awareness. CNW is where news, content and information converge.

Receive Text Alerts from CannabisNewsWire: Text “Cannabis” to 21000

For more information please visit https://www.CannabisNewsWire.com and or https://CannabisNewsWire.News

Please see full terms of use and disclaimers on the CannabisNewsWire website applicable to all content provided by CNW, wherever published or re-published: http://CNW.fm/Disclaimer

CannabisNewsWire (CNW)
Denver, Colorado
www.CannabisNewsWire.com
303.498.7722 Office
Editor@CannabisNewsWire.com

DISCLAIMER: CannabisNewsWire (CNW) is the source of the Article and content set forth above. References to any issuer other than the profiled issuer are intended solely to identify industry participants and do not constitute an endorsement of any issuer and do not constitute a comparison to the profiled issuer. The commentary, views and opinions expressed in this release by CNW are solely those of CNW. Readers of this Article and content agree that they cannot and will not seek to hold liable CNW for any investment decisions by their readers or subscribers. CNW is a news dissemination and financial marketing solutions provider and is NOT registered broker-dealers/analysts/investment advisers, hold no investment licenses and may NOT sell, offer to sell or offer to buy any security.

The Article and content related to the profiled company represent the personal and subjective views of the Author, and are subject to change at any time without notice. The information provided in the Article and the content has been obtained from sources which the Author believes to be reliable. However, the Author has not independently verified or otherwise investigated all such information. None of the Author, CNW, or any of their respective affiliates, guarantee the accuracy or completeness of any such information. This Article and content are not, and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action; readers are strongly urged to speak with their own investment advisor and review all of the profiled issuer’s filings made with the Securities and Exchange Commission before making any investment decisions and should understand the risks associated with an investment in the profiled issuer’s securities, including, but not limited to, the complete loss of your investment.

CNW HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.

This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected,” “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and CNW undertakes no obligation to update such statements.