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Solving the Hemp Extraction Problem created by the US Farm Bill

Featured Submission, Featured Submission
0 Comments| July 22, 2020

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Click to enlargeA CONVERSATION WITH
NICK KIMBALL, PRESIDENT AND CEO, CASCADIA EXTRACTS, and
AARON WILLIAMS, EXECUTIVE VICE PRESIDENT, CASCADIA EXTRACTS


MOTIVATION
What was your motivation to enter the hemp market in 2019?

KIMBALL: Two years ago, the cannabis market expanded from just marijuana to industrial hemp and the landscape changed. Congress passed the 2018 Farm Bill, allowing the legal cultivation of hemp. Within the federally dictated guidelines, states would have the legal right to grow, harvest, and process hemp for various purposes.

As with many business ventures, the motivation was borne out of personal experience. Having come to appreciate the health benefits of CBD and other cannabinoids over several years, I realized the important role that hemp products could play in overall wellness.

After many discussions with those in all stages of the industry, it became clear there was an opportunity in the extraction phase of the hemp supply chain. This involves taking the harvested hemp and processing it to separate the oils from the raw material.

With a focus on large-scale processing, I decided to start Cascadia with a team of individuals who bring experience, professionalism, transparency, and trust to this nascent industry.

WILLIAMS: Honestly, severe pain was my first motivation to explore hemp products, and ultimately to enter the industry. In my search for relief from my own chronic pain and inflammation following several sports injuries I acquired as a collegiate athlete, I found that many products on the market weren’t what I needed and were cost prohibitive.

I decided to partner with a friend to develop products to treat my own body, and was inspired to create products that help people manage their health.

My decision to take the next step into the hemp industry was spurred by a strong desire to increase access to the healing power of hemp, help create jobs for those in the community, and to provide for my family.


OUTLOOK AND FOCUS
In the past year of research and developing your business plan, what has changed most in the outlook of your focus?

KIMBALL: We are excited about bringing stability to the supply chain and we see significant opportunities in the processing space. What was true in 2019 will be true again in 2020: there is a bottleneck in extraction processing. We estimate there is only sufficient capacity to process 50% of the planted acres.

It’s taken time to learn who the players are, and to identify the real leaders in the business. What’s clear is that at every step in the supply chain, the hemp industry is composed of those with specific skill sets and strengths.

Establishing Cascadia Extracts as a leader in the extraction phase of hemp production is the primary goal. There is plenty of room in this industry, especially for those with strong business acumen and collaborative intentions.

This is a particularly interdependent ecosystem and success will be built on the quality and strength of the partnerships that are built between members of the supply chain. As an industry, we have a lot to do to help deliver a high-quality product with reliable sourcing and sustainable models.

WILLIAMS: I have broadened my understanding and vision for opportunities for custom extraction and formulations targeting a broad range of cannabinoids, terpenes, and flavonoids. Within all areas of the hemp industry, there is an incredible amount of innovation occurring, very quickly, and we plan to be at the front of it.

Our focus is the extraction phase, with plans to expand and grow as the market requires.


BACKGROUND
How has your business background helped to prepare you for this industry and this role?

KIMBALL: My decades long background in manufacturing, operations, and start-ups is ideally suited to building Cascadia Extracts with efficient business processes and a focus on quality, integrity, and cost effectiveness.

The systems that govern successful business models are common to many industries. I’m committed to the hemp industry, evaluating the opportunities that exist, and identifying the most aggressive paths to success for the company and its partners.

WILLIAMS: This is my third startup venture, and I have developed valuable business experience, specifically in the hemp industry. With more than a decade of experience in most levels of the supply chain, I have established critical connections within the hemp verticals and have cultivated relationships with what I consider to be respected leadership in the community.


EQUIPMENT
Describe the type of equipment you plan to use for extraction and why your process will help meet a need in the industry.

WILLIAMS: In addition to our ability to service a larger section of the industry because of our processing capacity, with our technology we will be able to create custom formulations and create high-quality hemp derivatives. The two primary extraction methods use either CO2 or ethanol as solvents. CO2 has always been the preferred method as it leaves no solvent residue and produces a cleaner product. However, historically, CO2 equipment had not been able to process large quantities of raw material whereas ethanol equipment could. That’s changed with the CO2 equipment we’re using, which can process more raw material in a day than most ethanol systems.

KIMBALL: We are currently working with a manufacturer to develop high-capacity CO2 extraction equipment to relieve the bottleneck in extraction services. Even with an expected reduction in crop yields for 2020, the amount of processing currently available will only be able to meet about 50% of what is needed.

Our CO2 equipment is revolutionary in its ability to process a high volume of hemp at an equipment price point that rivals other, smaller ethanol systems. With this increased throughput and efficiency, we will be able to create high-quality hemp derived products without any of the drawbacks of using ethanol.

Based on what we hear from those in the industry, particularly in product development and the retail markets, we believe that CO2 is by far the most desirable extraction method. The ability to extract large volumes of oil will provide a processing and monetization avenue for more farmers. With high-quality, clean crude, we will be able to provide our customers with a superior product for further refinement and product development.



ORGANIC PROCESSING
To what degree will you be focusing on organic biomass, processing and products? What does this mean for the process you will use and the SOPs for your extraction facility?

WILLIAMS: When it comes to all things organic what is important is, of course, the inputs, the process flow and organization, and cleanliness. We will be sourcing the highest quality inputs and track every step of the process from the farm to the client. There are specific protocols that will dictate our plans to expand to serve a wide range of clients, including those who want a completely organic process, from start to finish. What we put into our bodies matters a great deal, and organically grown and processed hemp is what I want to be consuming. We live in a time where the average consumer understands the value of organic.



Describe your intended role within the hemp farming industry?

WILLIAMS: As a grower myself, I understand that this is where it all starts. Farmers are often forgotten and/or pushed to their limits, receiving less than favorable returns. We plan to help stabilize this industry with a focus on our partner farmers. Farmers are forced to be forward-thinking, and they are good at it, so they need stability in processing and manufacturing to be successful. We also need them in the same ways. We plan to rise together.

KIMBALL: We see a very tight connection between our work and the farming community in a number of areas. We provide a vital service to farmers with a path to monetizing their crops. It’s in our collective best interest to support the farming community and not focus on the lowest transfer costs. Also, as our farming partnerships grow, we will be able to help drive the choice of hemp genetics and best farming practices allowing us to create the best formulations available.



FULL DISCLOSURE: Cascadia Extracts isa client of Stockhouse Publishing.


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