Tag: NBEV

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.

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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.

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)
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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.

Next Stage Cannabis Stocks in the Spotlight

CannabisNewsWire Editorial Coverage: Projections for the cannabis markets are staggering, yet there’s evidence that the lofty estimates may be understated.

  • Cannabis projections often fall far short of actual sales growth.
  • Cannabis-infused beverages looks to be next area of explosive upside.
  • Beverage and cannabis companies striking deals to gain market access.
  • New technologies could snag significant market share.

Once viewed as wild conjecture for the future of cannabis markets, forecasts in 2015 fell severely short of actuality. At that time, consensus was that Canada could reach CA$2.8 billion in legal sales by 2020. Sage prognosticators now say that the market may exceed CA$7 billion in 2019. Catering to the tastes of market demographics, intense interest is now focused on the cannabis-infused beverages market. Not even legal in Canada until this fall, the infused beverage market is already pegged to reach a mind-boggling CA$4.4 billion within five years.

Joining the ranks of the majors to meet this titanic demand, Sproutly Canada Inc. (OTCQB: SRUTF) (CSE: SPR) (SRUTF Profile) announced a joint venture with Moosehead Breweries, the largest and oldest independent beer company in Canada. Cannabis colossus Tilray Inc. (NASDAQ: TLRY) announced a research partnership into infused beverages and is bringing in executives with backgrounds in the beverage industry. The maker of Corona and Modelo beer increased its stake in Canopy Growth Corp. (TSX: WEED) (NYSE: CGC) to 38%, spurring speculation of cannabis-infused beverages to come. HEXO Corp. (NYSE American: HEXO) (TSX: HEXO) entered a joint venture with Molson Coors Canada to produce CBD-infused beverages. And New Age Beverages Corp. (NASDAQ: NBEV) is anticipated to begin roll out of Marley+CBD-infused drinks in four targeted U.S. states.

To view an infographic of this editorial, click here.

Untapped Market

Soothsayers seem to consistently underestimate the warp-speed of public acceptance and the velocity of uptake of cannabis products. As marijuana muscles into the mainstream, usage among all age groups is on the upswing. However, among the most coveted 18-34 demographic, there’s an explosion of acceptance as these users mature in a world where cannabis is common. Millennials are about three times and Gen Z about four times more likely to use cannabis than aging Boomers. Forward-leaning cannabis companies are full throttle in product and brand development to corral this coveted demographic and capture market share, now and for decades to come.

According to a United Nations report, cannabis is the most widely consumed drug on the planet. Even so, only about 4% of the world’s adult population has used it. North America, the leader in cannabis growth, is only the fourth largest cannabis consumer market on the globe, ranking behind Asia, Africa and Europe in sheer size of its cannabis consumer market. As public perceptions change and legalization expands, the number of users is certain to skyrocket in a nearly untapped market. A global transition is underway and presenting a once-in-a-generation opportunity.

The Deal

Of particular interest is the cannabis-infused beverages market. Poised to capture an outsized share of the infused beverage boom, Sproutly Canada Inc. (OTCQB: SRUTF) (CSE: SPR) and Moosehead announced a joint venture that marries Moosehead’s vast adult-beverage experience with Sproutly’s innovative cannabis technology. The result? A fast-onset, fast-offset option that some have called the industry’s holy grail of beverages.

Leveraging Sproutly’s transformational technology to create the world’s first and only truly natural water-soluble cannabinoids, the partners will develop, produce and market beverages that will solve the major issues that limit the consumer appeal of cannabis-infused beverages in the market today: 1) a beverage that actually tastes good and 2) that can provide the cannabis experience with an immediate onset and controllable experience of up to 90 minutes. Sproutly and Moosehead intend to be ready to put recreational infused beverages on the shelves by the time of legalization.

Utilizing Sproutly’s acquired patent-pending process, validated by 13 years of scientific R&D, the partners will form a new company to launch a full line of infused products. Moosehead is an iconic Canadian brand, selling more than 140 million bottles of beer annually across Canada, the U.S. and 15 countries around the world. The company’s 152 years of beverage experience and formulation prowess has led to over a dozen popular brands, including licensed and supporting partner brands such as Angry Orchard, Twisted Tea and Samuel Adams beer, proving the ability to manufacture and market leading adult beverages. In addition, the Oland family who owns 100% of Moosehead also owned the beer brand Alexander Keith’s prior to its sale to Labatt Brewery Company which is currently owned by Anheuser-Busch InBev.

Unlike other lopsided joint venture forays into cannabis beverages, the Sproutly-Moosehead agreement is a 50-50 equity partnership structured to maximize the alignment of interests. Even the board of directors will have an equal number of board members from each company, with Sproutly appointing the chairman. The joint venture includes a five-year exclusive agreement for Sproutly to deliver its breakthrough water-soluble cannabis solution, and Moosehead will license all its brands and related intellectual property to the new company formed by the agreement. Moosehead will provide marketing, distribution, logistics, admin and other resources while Sproutly will deliver formulation, R&D, marketing and other resources.

Underscoring the significance of the agreement, Matthew Oland, a Moosehead executive and scion of the founders, will leave Moosehead to become CEO of the newly formed company. Moosehead and Sproutly combined appear to be going all in on this enterprise.

Paradigm Shift

Perplexing problems plague the creation of ingestible cannabinoids. Cannabinoids and terpenes are completely insoluble in water resulting in serious difficulties with absorption, dosing, efficacy and onset/offset times. For years laboratory-formulated cannabinoids have been engineered to become water compatible and sort of mimic water solubility. These techniques have been in use by pharmaceutical and beverage companies for decades, but production challenges and insolubility issues remain for cannabinoids. Relying on the same outdated, costly and ineffective techniques, these encapsulation and emulsion technologies are what’s currently being employed by the suitors to the cannabis-infused beverage bonanza.

Establishing a paradigm shift in how cannabis is effectively and efficiently processed, delivered and consumed, Sproutly is transcending the industry’s current antiquated regimens. Already a licensed premium cannabis producer with 1,400 kg annual production capacity, Sproutly also owns the rights to the world’s first and only naturally water-soluble cannabis technology for Canada, Australia, Jamaica, Israel and the entire European Union.

Sproutly’s partner who licensed the technology, Infusion Biosciences, discovered that the cannabis plant naturally produces water-soluble forms of phytochemicals. Infusion Biosciences then created a patent-pending Aqueous Phytorecovery Process (APP) for the recovery of naturally water-soluble phytochemicals (Infuz2O). Unlike encapsulation or emulsion, Infuz2O is a truly water-soluble cannabis solution that fully dissolves in water and can be easily and economically added directly into beverage formulations.

Infuz2O has the unique ability to deliver precise doses and measurable amounts of cannabis and is predictable, with less than five minutes onset and less than ninety minutes offset times, the same as smoking or vaping cannabis. Sproutly’s APP Technology also recovers valuable natural oil-based cannabinoids in addition to the water-soluble phytochemicals destined for beverages. Sproutly’s transformational technology produces the world’s only naturally water-soluble bioactive molecules that deliver the full experience of cannabis that is strain specific. Product and production advantages such as these could lead to a lion’s share of a market set to quickly balloon to billions of dollars.

Creating Value

Highly scalable, Sproutly’s pioneering technology is also an extremely cost-effective process to extract both water-soluble and naturally derived oil-based cannabinoids. Using its APP technology, Sproutly should be able to produce better quality products faster and cheaper than the competition. Little wonder Moosehead is so committed. Current methods require at least four complex processes to extract cannabis oil from biomass and three more to obtain water-compatible products.

In just two steps, using APP technology, Sproutly produces both water-soluble and oil-based cannabinoids without using any alcohol or solvents. And that’s not all. Using current CO2 extraction methods, THC recovery rate is about 60%. Sproutly’s APP Technology delivers a total of 90% THC recovery rate. The economic ramifications seem obvious. This isn’t an idea or concept; the technology is in place. In fact, the APP Technology is already proven in real-world applications and is ready for full operational deployment.

Shortly after acquiring Infusion Biosciences Canada and the rights to use the APP technology, Sproutly entered an exclusive technology license agreement with Micronutrient Technologies to produce nutritional minerals in water solutions in a low-cost, scalable process. The agreement provides Sproutly the unique ability to add healthy, water-soluble minerals such as calcium, magnesium, iron and zinc, and in different combinations, directly into various cannabis beverages without artificial chemical additives. Sproutly now has the unequaled ability to create beverages that not only cater to cannabis consumers but also cross over to the large, functional beverage market. Sproutly’s seemingly unparalleled versatility in beverage formulation crosses multiple sectors with limitless end-user applications.

The joint venture with Moosehead not only validates Sproutly’s technology but also positions the venture to reap enormous rewards in the nascent cannabis-infused market. And this may only be the beginning for Sproutly.

In the Hunt

Tilray Inc. (NASDAQ: TLRY) is one of the established cannabis companies in the hunt for the infused-beverage market. In December, the company announced a research partnership with Anheuser-Busch. Tilray also recently announced that it was bringing executives into its leadership team who have strong backgrounds working for big beverage companies.

Focused on healthy beverages, New Age Beverages Corp. (NASDAQ: NBEV) is banking on the popularity of Bob Marley to help grow its products. The company’s Marley+CBD products will first begin roll out in four U.S. states, although a date hasn’t been established for when that will happen.

Last August, Constellation Brands, the maker of Corona and Modelo beer, increased its stake in Canopy Growth Corp. (TSX: WEED) (NYSE: CGC) to 38%, spurring speculation of cannabis-infused beverages to come. Canopy’s forays into the U.S. hemp markets suggest CBD beverages may be on the horizon.

HEXO Corp. (NYSE American: HEXO) (TSX: HEXO) entered a joint venture with Molson Coors Canada (MCC) last summer to produce CBD-infused beverages in which the brewing giant took 57.5% ownership. The new company will be led by a former Molson Coors executive. As part of the deal, HEXO issued 11,500,000 warrants to MCC.

There’s little argument where the cannabis markets are headed, and all indications point to infused beverages becoming the next big surge. Perhaps the lofty forecasts for the cannabis-infused beverages market in Canada will imitate past cannabis projections and vastly exceed expectations again.

For more information on Sproutly Canada, visit Sproutly Canada Inc. (OTCQB: SRUTF) (CSE: SPR) (FRA: 38G)

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.

Drink Companies Prepare for the Coming of CBD Beverages

CannabisNewsWire Editorial Coverage: CBD-infused beverages look set to hit the market in a big way in 2019.

  • Cannabidiol (CBD) is widely used in health and wellness products after spectacular growth in recent years.
  • Several companies are lining up to launch CBD drinks following legal changes in the United States and Canada.
  • Integrating these new offerings into wider product lines is accelerating CBD’s race for mainstream attention.

Youngevity International Inc. (NASDAQ: YGYI) (YGYI Profile) is one of the first to launch, with a CBD coffee coming in May and a CBD water in the works. The Alkaline Water Company Inc. (NASDAQ: WTER) (TSX.V: WTER), which is constantly growing its U.S. distribution network, plans to add a CBD bottled water to its range. The New Age Beverages Corporation (NASDAQ: NBEV) is adding CBD to its line of organic cold coffees and teas. Heineken (OTCQX: HEINY) has also entered the market by developing a cannabis-infused sparkling water through Lagunitas, its U.S. craft brewer. And the biggest investment in the overall cannabis space has come from Constellation Brands Inc. (NYSE: STZ), which has invested $4 billion in a Canadian cannabis company.

To view an infographic of this editorial, click here.

Crossing the Boundary Between Two Industries

The most exciting new developments in business often come when separate trends or industries combine. For example, it was the combination of previously separate cameras, phones and portable music that brought us the smartphone, a technology that has transformed our lives. And while not every combination will be as socially disruptive as that computer in your pocket, each one brings new possibilities.

One of the hot crossover moves this year is the combination of the markets for beverages and for cannabidiol (CBD). The emergence of CBD over the past few years has transformed the cannabis space and allowed hemp producers to reach beyond their original markets. Beverages continue to be a powerful industry, in part through sporadic bursts of innovation such as the rise of energy drinks. Now one of those bursts is coming again as these two trends combine to produce CBD-infused drinks.

The Rise of CBD

In many ways, the popularity of CBD has caught businesses by surprise. Only a few years ago, it was an obscure chemical compound found in cannabis and hemp, not even the part of cannabis that got users high. Now it’s a newsworthy growth industry, with CBD products appearing on the shelves of health shops, pharmacists and vaping stores, as well as on dedicated online outlets. The trend has also led to the rise of new companies as well as investment from the likes of Youngevity International Inc. (NASDAQ: YGYI). CBD isn’t everywhere yet, but it’s feeling close.

Though it wasn’t predictable, the rise of CBD is easy enough to explain. Since cannabis legalization began in the 1990s, extensive research and development has been conducted regarding the plant. One of the results is a greater understanding of and focus on the range of chemicals found in cannabis, instead of just the high-inducing THC. As researchers started finding and reporting evidence that CBD could be beneficial for health and wellness, a gold rush began.

One of the big advantages of CBD, especially for an omnidirectional lifestyle company such as Youngevity, is that it can establish a strong presence in markets that THC can’t reach. Shops that don’t sell cannabis are sometimes willing to stock CBD-infused products. Some jurisdictions allow the sale of CBD but not cannabis. With the cannabis space gaining momentum, CBD creates a route into that sector with fewer restrictions.

This is particularly true because of hemp, a form of cannabis that doesn’t contain THC and that the federal government legalized three months ago. CBD can be extracted from hemp, making it a profitable cash crop. A Youngevity subsidiary has recently acquired a 45-acre base in Florida purely for the purpose of meeting the demand for CBD.

CBD Beverages

The U.S. government’s widespread legalization of hemp through the passage of the 2018 Farm Bill last December has opened the way for a whole range of CBD endeavors. One of the most popular trends is expected to be CBD beverages.

Youngevity, which already has a strong presence in both beverages and CBD via its CLR Roasters and HempFX brands, has made the most of its established expertise to move quickly into this promising young market. The company has added a CBD-infused coffee to its Javalution coffee brand, which will go on sale at the end of May.

“We are extremely pleased with the taste of the product,” said Ernesto Aguila, president of CLR Roasters. “It is very exciting to bring a new product to market that has so much interest within the coffee beverage category. I have not seen a door opener like this since Javalution Coffee Company created the first fortified coffees.”

CBD beverages are more than just a novelty; they’re a way to make CBD consumption better fit with people’s everyday lives and socializing, and to blaze a trail for cannabis drinks to follow. By putting CBD in drinks, manufacturers such as Youngevity are making it possible for consumers to enjoy their CBD in common social settings, such as cafes, bars and restaurants. While one person orders an alcoholic drink and another sips a soft drink, a third could be enjoying a CBD drink, all at the same time. YGYI’s move helps brings CBD consumption into the mainstream.

YGYI’s strategy has been made easier by the relaxed approach of the FDA. While that authority claims jurisdiction over the use of CBD in food and beverages, the government entity hasn’t done much to limit its use. In the 21st century, the public will to suppress cannabis use is fading, and resistance against CBD appears to be almost nonexistent. A door has been opened, and companies such as Youngevity are walking in to make the most of it.

The Bigger Beverage Business

Part of bringing CBD into the mainstream is integrating it with other product lines. As long as CBD is separate in its own corner, persuading people to give it a try will be challenging. However, when it’s presented as simply one more option among a variety of beverages, raising awareness and use of the substance stands a better chance. That’s precisely what Youngevity is aiming to do through a recently announced agreement with water company Icelandic Glacial.

The deal will see the two companies work together as exclusive cross-marketing partners for the next three years. Icelandic Glacial drinks will appear alongside Javalution and other beverages in Youngevity’s direct-sales network.

Beyond this, the companies will also collaborate on creating new products targeting the lifestyle, health, food and beverage markets. A drinkable CBD product will be at the forefront of these developments, creating a connection between the purity of Iceland Glacial’s water and the relaxing potential of CBD.

This deal hasn’t just increased Youngevity’s product range. It has given the company more opportunity for growth and product development that will appeal both to the core CBD market and to a wider beverage consumer base.

A Changing Drinks Market

It seems that CBD might become the latest big disruptor in the beverage industry, which was last shaken up by the rise of energy drinks 20 years ago.

The fastest growing premium water brand in the US, The Alkaline Water Company Inc. (NASDAQ: WTER) (TSX.V: WTER), is distributed through more than 150,000 stores, including nine of America’s top-ten retailers by size. In 2018, the company announced a range of drinks targeting the health and wellness markets, including a water infused with vitamins and minerals and another with CBD. The company is waiting on FDA approval before launching its CBD water, but once the product is ready to go, it will have great reach thanks to the company’s strategy of regularly increasing its distribution network.

Founded in 2016, the New Age Beverages Corporation (NASDAQ: NBEV) is a young and vibrant company with a focus on healthy drinks produced in an environmentally and socially responsible way. In January, the company announced a deal for the distribution of CBD-infused beverages under its Marley brand. The Marley range of organic cold coffees and teas is already an established brand for New Age Beverages and a natural fit for entering the CBD market.

Hi-Fi Hops, Heineken’s (OTCQX: HEINY) cannabis beverage, was launched last year in two versions: one with 10 mg of THC and one with 5 mg of THC and 5 mg of CBD. The product is sold in California’s cannabis dispensaries and is the result of a collaboration between AbsoluteXtracts, a manufacturer of cannabis-based products, and Lagunitas. “The idea of being a part of a no-calorie beverage infused with cannabis seemed like a perfect next step in our product innovation and a natural way to marry our past with our future,” said Lagunitas CEO Maria Stipp.

Beverage giant Constellation Brands Inc. (NYSE: STZ), which owns Corona beer and Svedka vodka, has made the biggest financial commitment so far to advancing CBD beverages. The company has invested $4 billion in Canopy Growth Corporation, one of Canada’s largest cannabis producers. The two companies will be working together to produce cannabis drinks, giving the sector a significant boost to its public profile thanks to Constellation’s marketing reach.

CBD drinks are a natural combination of two popular consumer sectors, and with so many companies invested in them, this looks likely to be the year they take off.

For more information on Youngevity, visit Youngevity International, Inc. (NASDAQ: YGYI)

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)
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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.

Direct Selling Companies Prove Attractive for CBD Market, Drawing Large Non-Endemic Cannabis Industry Partners

CannabisNewsWire Editorial Coverage: With experts such as the Brightfield Group predicting the hemp-derived CBD (cannabidiol) market will reach $22 billion by 2022, major industry players such as Anheuser-Busch are seeing value and viability in the direct selling approach to selling CBD products.

  • With a predicted 130 percent compound annual growth rate (CAGR) over the next three years, the hemp-derived CBD industry looks primed to explode.
  • The direct selling approach to selling CBD products pioneered by brands such as Youngevity International is attracting the interest of large-scale companies.
  • Given new medical studies proving the efficacy of daily CBD intake, the market appears ripe for companies with vested interests in other lifestyle markets.

Following the passing of the groundbreaking 2018 U.S. Farm Bill that legalized the industrial cultivation of hemp nationally, scores of companies not endemic to the cannabis industry are looking for ways to enter the booming CBD market. Partnerships and acquisitions look to be one of the most promising strategies, with many savvy companies utilizing the direct selling route originated by brands such as Youngevity International Inc. (NASDAQ: YGYI) (YGYI Profile), a leading omni-direct lifestyle company. New Age Beverages Corporation (NASDAQ: NBEV) recently merged with a direct selling company to distribute its CBD products, while beer giant Constellation Brands Inc. (NYSE: STZ) poured a $4 billion investment into Canadian cannabis company Canopy Growth Corporation (NYSE: CGC) (TSX: WEED). Anheuser-Busch InBev (NYSE: BUD) (OTC: BUDFF) also partnered with a leading Canadian cannabis producer to research cannabis-infused drinks and owns 20 percent of Icelandic Water Holdings, which recently entered into an exclusive joint-marketing/development agreement with Youngevity to develop and sell CBD-infused products.

To view an infographic of this editorial, click here.

A Market Primed to Skyrocket

The recent deregulation, legalization and proliferation of the cannabis industries in the United States and Canada made 2018 a landmark year for those industries, creating an ideal scenario for an astronomical growth rate. Canada’s recent move to legalize recreational marijuana and the United States’ decision to legalize the industrial cultivation of hemp nationwide has experts forecasting the global cannabis industry to exceed $39 billion by 2023 and possibly exceed $95 billion by 2026.

Within that market, the hemp-derived CBD segment will likely grow at an even faster rate, with that growth buoyed by the fact that it doesn’t have to pass any state legalization hurdles across the United States. Brightfield Group expects the hemp-CBD industry’s growth to outpace the rest of the cannabis industry combined, and Hemp Business Journal estimates the hemp market to grow around 700 percent by 2020. With the meteoric growth predicted, companies such as Youngevity International Inc. (NASDAQ: YGYI), which already have established direct-selling channels that can nimbly adapt and upscale marketing, production, and delivery, could see a boon in business.

Direct Selling Method Attracting Corporate Giants

Given the nascent nature of the cannabis industry, many consumers are just learning about CBD products, meaning that growth within the industry is happening in the most organic fashion possible: word-of-mouth marketing. Brightfield Group notes that more than 50 percent of CBD consumers in all U.S. regions first learned about CBD from friends or family, which makes direct selling companies a “fantastic fit” for the CBD industry.

Studies by Direct Selling News show that direct selling companies already lead the global market in sales of CBD products with more than $300 million in annual sales. Therefore, the interest of larger, non-endemic companies in the direct selling model of brands such as Youngevity only makes sense and may signal that, as the cannabis market continues its stratospheric growth, so too will the direct selling sector within the industry.

Increased Medical Studies Cause Increased Interest in CBD

One of the main driving forces behind the rapid increase in popularity in CBD globally is increased awareness by consumers of the widespread medical uses of CBD. Research has shown that CBD, particularly when used daily, can help treat and prevent symptoms of Alzheimer’s disease, chronic pain, anxiety, insomnia, arthritis, epilepsy and a slew of other ailments.

Given that, companies such as Youngevity — which has the ability to deliver CBD in convenient packaging and applications for daily use — may have an upper leg when it comes to profiting off the growing trend. Knowing that, it makes sense that Youngevity recently announced an exclusive joint-marketing agreement with Icelandic Water Holdings, a company in which Anheuser-Busch has 20 percent ownership.

Youngevity and Icelandic plan to develop and sell CBD-infused dietary supplements, children’s drinks, pet products, and coffee products via Youngevity’s direct selling platform. This move seems to validate not only the viability of the direct selling model in selling CBD products but also the potential windfall businesses already established in other lifestyle industries may experience by integrating into the CBD sector.

Lifestyle Direct Selling Companies Poised to Capitalize on Expanding CBD Market

Globally, the direct selling market is growing. Research by Euromonitor shows that the direct selling market is expected to reach $163 billion by 2020, with the largest portion of that business coming from the wellness industry. Given the aforementioned promise of the CBD market in the direct selling industry, along with the expected continual growth of the direct selling industry at large, it only makes sense that direct selling companies poised at the intersection of the cannabis, wellness and other lifestyle industries may be best suited to capitalize on the inclusion of CBD in other industries.

Youngevity could be an ideal example of just such a company. The direct selling expert has already established a sterling presence in the coffee industry through its wholly-owned subsidiary CLR Roasters, a proven farm-to-cup pipeline that can be quickly and easily adapted for hemp cultivation. Its holdings in other markets ripe for CBD inclusion such as the beauty and wellness industries, Youngevity may be best positioned to harness the incredible growth in the CBD market, particularly via large-scale corporate partnerships and mergers.

CBD Market Continues to Draw Non-Endemic Interest as Direct Selling Flourishes

New Age Beverages (NASDAQ: NBEV) recently merged with the direct selling company Morinda with the stated intent to sell CBD products through Morinda’s direct selling model. This appears to be a solid endorsement of the viability of direct selling in selling CBD. Created in 2016, New Age has developed a brand portfolio competing in the highest growth segments of the beverage industry and has created the only one-stop-shop of healthy beverages. By combining with Morinda, New Age plans to rapidly grow its brands by adding a direct-to-consumer infrastructure and market access to 60 countries around the world.

Constellation Brands (NYSE: STZ) has similarly shown that the beer industry is keenly interested in the CBD market. It recently invested $4 billion in Canadian cannabis producer Canopy Growth (NYSE: CGC) (TSX: WEED), telling U.S. lawmakers it was “extremely bullish, if not more bullish” on the prospect of selling CBD-infused drinks in the United States. following the nationwide legalization of industrial hemp cultivation via the 2018 U.S. Farm Bill. Given its positioning as a premium beer, wine, and spirits company, Constellation’s interest in the market may signal that other large corporations in the premium beverage market may see viability in CBD.

Canopy Growth was the first cannabis company in North America to be publicly traded, then followed that milestone by becoming the first North American cannabis company to diversify its platform to include both greenhouse and indoor growing, to acquire a major competitor and to be listed on the Toronto Stock Exchange. Through its subsidiary, Canopy was also the first cannabis company to introduce the now-standard concept of compassionate pricing, making medical cannabis more affordable for patients.

Anheuser-Busch Inbev (NYSE: BUD) (OTC: BUDFF), the massive brewer that makes Budweiser Bud Light, and more than 500 other beer brands, has shown a keen interest in the CBD market. The company recently partnered in a $100 million joint venture with Tilray Inc., a leading Canadian cannabis company, to research cannabis-infused drinks for the Canadian market. Currently the partnership is limited to Canada, with the companies making decisions regarding the commercialization of the beverages in the future. Anheuser-Busch said it would participate in the project through its subsidiary Labatt Breweries of Canada.

The recent nationwide legalization of hemp cultivation in the United States, as well as the nationwide cannabis legalization in Canada, has created a rapidly expanding CBD market. With the proven success of direct selling companies in selling these products, it seems the direct selling industry will continue to help propel the CBD market as large-scale, non-endemic companies look for ways to gain entry into the market.

For more information on Youngevity, visit Youngevity International, Inc. (NASDAQ: YGYI)

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.