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A Multi-Phase Commercial Hemp Project

The project has three principal thrusts: hemp farming, primary processing of the crop, and secondary processing into finished products. The Company’s goal is to have more than one hundred farmers participate in the project by year five. The introduction of hemp into the farming system will take into consideration other farming activities of the region, so that complementarities will be fully exploited. Hemp has the potential of becoming a major regional crop similar to potatoes in the northwest of the province.

In 2017 Global Hemp Group (GHG) and its joint venture partner Marijuana Company of America (MCOA) launched this multi-phase commercial hemp project in northeast New Brunswick, Canada. This marked the return of industrial hemp in the region for the first time in 20 years. Earlier attempts failed to take off due to lack of market opportunities at the time.

The second phase of the strategy, commercial cultivation for extraction of cannabinoids, is currently underway. A 4,000 sq. ft. facility in Bathurst has been leased for the project, which is used for offices, a drying facility to process the fresh biomass, and storage until the dried biomass can be monetized by selling it to a cannabinoid extraction company.

The final phase of the project, which will be initiated once the region reaches large scale hemp commercial cultivation, is the Company’s Hemp Agro-Industrial Zone (HAIZ). The HAIZ focuses on the development of an industrial cluster adjacent to the hemp crop, ensuring a market for farmers, year-round manufacturing job opportunities for the region, and a model for the Company to attract and develop additional HAIZ projects in other regions in both Canada and the United States. This strategy is expected to create a consistent revenue stream for years to come.

Field Crop Style

To date, all cultivation at the Company’s New Brunswick project has started from seed, in a field cropping style with over 100,000 plants per acre. This differs from the Company’s Oregon project that is grown in an orchard style cultivation from clones that are planted at approximately 1,250 plants per acre. CBD content in New Brunswick is lower (2 – 5%) as the project can only use hemp seed that is on Health Canada’s List of Approved Cultivars, which at this time does not have cultivars with 8-14% CBD content as used at the Oregon project. Utilizing dense cropping will increase the biomass, thereby increasing the amount of CBD produced from this style of cultivation. Moreover, field cropping offers better opportunities for mechanization and lower labour costs.

The Farmers

Unlike the Company’s Oregon project where a farm is owned directly, farmers are contracted to grow hemp in the region. The goal of the project is to increase the acreage under cultivation to more than 1,000 acres in the near term. To date, participating farmers were located throughout the northeastern region of New Brunswick. Having a distribution of farms in the area will maximize the demonstration effect and will facilitate the recruitment of additional farmers in the coming years.

Collaboration with DAAF

The Company has been collaborating with the New Brunswick Department of Aquaculture, Agriculture and Fisheries (DAAF) on a number of demonstration projects, including collaboration on the study of the impact of the European Corn Borer (ECB) on the hemp plant, soil acidity correction utilizing slag lime and testing of the use of modern drone technology to monitor field conditions at the farms to provide a holistic view of a crop’s growth, identify issues and better target field scouting. DAAF has also conducted Nitrogen fertility trials on selected partner farms. Information gained from these various initiatives will improve the management of the crop and benefit all hemp farmers in the region.

 
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