Join today and have your say! It’s FREE!

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.
Please Try Again
{{ error }}
By providing my email, I consent to receiving investment related electronic messages from Stockhouse.


Sign In

Please Try Again
{{ error }}
Password Hint : {{passwordHint}}
Forgot Password?


Please Try Again {{ error }}

Send my password

An email was sent with password retrieval instructions. Please go to the link in the email message to retrieve your password.

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.

A Unique Play in the Hungry US Hemp Market

Stockhouse Editorial
0 Comments| September 24, 2020

{{labelSign}}  Favorites

(Image via Cascadia Extracts.)

Utilizing high capacity CO2 extraction equipment to tap into the extremely underserviced hemp market, Cascadia Extracts (P. CASCADIA, Forum) uses unique technology to take advantage of the significant benefits associated with CO2 extraction with the added benefit of not being limited with the usual draw-back of limited capacity.

With operations out of the state of Oregon, Cascadia has chosen the method of CO2 extraction, as it is 100% toxin free, environmentally clean, and creates a pure, high-quality oil. Hemp biomass is grown, cultivated, and harvested at a rate faster than processors can handle, with 1,945 cultivators to 527 processors.

Cascadia is out to process some of the finest high-cannabinoid hemp plants in the world and intends to scale up its operation to meet the ever-increasing global demand for cannabinoid products.

In our previous work, Stockhouse Editorial talked about the Company’s business model and how it is well-positioned to capitalize on a global industrial hemp market.

Cascadia Extract’s President and CEO, Nick Kimball took time out of his busy schedule to talk with us and dig deeper into the specific advantages to investors of its debenture and talk more about the high demand of this sector.

  1. Thank you for taking the time to speak with us and talk more about your Company. To begin, let’s focus on the specific advantages to investors of your debenture, can you give us a breakdown of what this all means for you?

Cascadia sees the convertible debenture as an excellent vehicle for getting in on the ground floor of this opportunity. The debentures pay a 10% coupon per annum, and convert at the lesser of a 20% discount to the next raise or a pre-money valuation cap of $5MM USD. We believe the coupon is an excellent way to attract investors with an upfront return as we work to increase the company valuation. Compared to others in the extraction space, Cascadia is at an attractive starting valuation.

  1. Cascadia’s Deal Room private placement is live now, can you tell us a bit more and let us know what the funds will be earmarked for?

The funds from this initial raise will be earmarked for a few key operational areas. First, and foremost, we will secure the extraction equipment that will drive our business. We then expect to finance a portion of the equipment and re-invest that money into the business. Secondly, we will finalize our facility and prepare it for operations. We have some funds targeted for staff development and working capital and some targeted at relationship building with both suppliers and clients.

  1. You’ve spoke about your advanced tech in the past, but can you provide a quick rundown for those who are new to Cascadia about just how advantageous this is, specifically the benefits of CO2 extraction, minus the limitations with the usual draw-back of limited capacity?
In the world of hemp extraction there are two primary extraction methods: ethanol and CO2. CO2 is the preferred method by product manufacturers because it is clean and it provides for greater extraction customization. Many companies moved to ethanol extraction because of the capacity limitations presented with CO2 extraction. However, our extraction technology solves the CO2 capacity problem with revolutionary throughput quantities. With our system we will be able to process more than any one ethanol system on the market, and the oil will be higher quality, require less post-processing, and can be customized to meet the needs of our customers, big or small. We believe it is our equipment and our team that are huge differentiating factors that set us apart in the industry.

  1. What kind of advantages does Cascadia’s business model offer for the hemp sector?

Our belief is that there are two ways to approach the oil extraction segment of the hemp supply chain. The first is to go small and adopt a boutique approach to the market, possibly using one’s own extractions as the basis for consumer facing brands and products. The second is to go big and become a mid-market player satisfying the needs of the large national and international brands, whether in consumer-packaged goods, health, or the food and beverage industry. We’ve chosen the latter path because we think this is the best path to growth, the best way to establish ourselves as a trusted, value-added component of the supply chain, the best way to impose standards of excellence in a rapidly growing industry, the best way to demonstrate value for those large players when they fully enter the market, and the best way to provide returns to our investors.

  1. Currently, 47% of Oregon farmers cannot find a processor, what kind of opportunity does this hungry market offer for you and your shareholders?

Hemp processing has always been a bottleneck in the hemp supply chain. This bottleneck causes waste on the farmer side and uncertainty on the output side. One of Cascadia’s main goals is to ease this bottleneck and bring stability and predictability to the supply chain. This, in turn, will create a level of comfort for the large CPG companies to invest in the industry. Demand continues to rise and once the supply chain is stable, the growth will be exponential.

  1. What trends in hemp do you predict will emerge in the near future?

Hemp is an extraordinary plant and more is being discovered about it every day. On the extraction side, we believe that additional cannabinoids, such as CBG, will play a larger role and that custom formulations will become increasingly important as people begin to understand the efficacy and interactions of the different cannabinoids, including THC, and terpenes. We also see an explosion in the application of the hemp plant to other market segments, such as textiles, food, plastics, and construction materials.

  1. The 2018 US Farm Bill was thought to be huge for hemp, where do you see this industry placed now in the grand scheme of agriculture?

The 2018 US Farm Bill was, in fact, huge for hemp and has paved the way for the explosive growth in hemp and hemp-derived products. The Farm Bill defined and legalized industrial hemp at a federal level. Industrial hemp is any hemp plant with less than 0.3% THC. In many states, hemp is becoming a dominant crop, by weight, and represents a significant source of revenue for farmers.

  1. There is a fair bit of uncertainty around this industry in the US, how does Cascadia intend to overcome this?

There is uncertainty in the US, but that is to be expected in a market this new> The rules are still being written. Some of the uncertainty has to do with timing. The government, the FDA in particular, is rightfully focused on the pandemic so some decisions and clarifications may get delayed. Our approach is to remain flexible and adopt a technology base that will allow us to move as the markets and regulations change. We also want to have technology and processes that are future-proof and will be compliant as new regulations are promulgated.

  1. Looking six months to a year down the road, where do you expect the Company to be? What milestones do you hope to have accomplished?

Cascadia expects to have established a reputation for high quality products, repeatable processes, and transparent operations. In a year, we want to have our main extraction line running at a high capacity, with multiple offtake agreements in place, making our oils available to a wide variety of clients. We also want to have in place many more long-term relationships with farmers on production, revenue sharing, and genetics choices. We expect to have a first-rate time in our labs, with chemists and formulation experts, and a results and efficiency focused operations group.

  1. Thank you again for your time today, anything further to add?

All of us at Cascadia Extracts are excited about what lies ahead. We believe that the current pandemic is providing a boost to the hemp-derived products market as more and more people are taking their own health into their own hands. The use of CBD and the other cannabinoids is rising as a result. We are looking forward to being in the right place providing a valuable service and products as the country and the world heal.

To find out more about the Company, watch the video below and visit their website:

FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.

{{labelSign}}  Favorites


No comments yet. Be first to comment!

Leave a Comment

You must be logged in to be able to post a comment.

Get the latest news and updates from Stockhouse on social media