The Green Organic Dutchman (TSX: TGOD) announced this morning that it too was increasing its involvement in the hemp sector. The firm has established a Global Strategic Hemp Division, which will include the companies HemPoland assets. TGOD will strategically utilize its European assets to leverage expertise in the sector for the development of local CBD products.
With the announcement of the new division, The Green Organic Dutchman identified that they have already begun planting on 158 acres of organic farmland in Southern Ontario. Operating as The Green Organic Hemp, the subsidiary of TGOD grew a small test plot last year on the site after obtaining approval from Health Canada. The first harvest is expected to occur in twelve weeks time, however the company left out any specific yields that it expects to achieve.
“Our team has years of direct hands-on experience in the CBD space and we are excited to use this advantage to execute on a fast-moving market expansion strategy. CBD is a wellness product and has a natural fit with TGOD’s certified organic positioning and the large segment of consumers who are increasingly demanding natural and organic products. The time to act is now, and TGOD has the team, the infrastructure and the capital to establish a significant presence in this market.”
Brian Athaide, CEO of TGOD
The news comes as many players are announcing their entrance to the CBD and hemp market across both Canada and the United States. With the recent reclassification of hemp in the US, many TSX and TSX Venture players are now focusing on the market which was previously out of bounds due to listing requirements. CannTrust announced earlier this week their intent to grow 3,000 acres of hemp in the US, while Charlotte’s Web had a similar announcement on the same day.
Sector players intend to utilize the hemp in many ways that they originally had planned to use cannabis and its derivatives. The CBD rich hemp will be extracted for use in tinctures, beverages, concentrates, vaporizors and other end products that require manufacturing of the plant. Hemp is being utilized as a means for firms to get an understanding of how to work with the plant, as well as enabling production processes to be put into place ahead of cannabis legalization in many jurisdictions.
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For their own part, TGOD appears to be using hemp as a means of generating revenue while their cannabis operations are still being established. After a lengthy delay at its Hamilton facility due to issues with city council, the firm is largely reliant on hemp for its current revenues. In it’s latest quarter, TGOD posted revenues of $2.40 million, all of which was comprised of HemPoland sales in European markets.
The Green Organic Dutchman intends to supplement its own growing operations with additional offtake agreements for the 2019 season. These agreements could be for up to 50,000 KG as per this mornings release. The biomass will be utilized for extraction purposes, through agreements currently in place with both Valens GroWorks as well as Neptune Wellness.
Information for this briefing was found via Sedar and The Green Organic Dutchman. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
