Episode 35

The Pressure of the Market – Hemp

In the second episode of this three-part series, we’re looking at the pressures of the hemp market. Historically, hemp went through a terrible chapter where it was falsely equated with cannabis and all the allegedly-harmful effects of cannabis. Fearful parents and community leaders did everything they could to keep cannabis – and, by extension, hemp – out of their communities. 

Now, hemp is starting to win back its reputation, little by little. The industry is making major strides by proving just how diverse and valuable hemp is, including by leveraging the powers of the plant to create sustainable versions of everyday goods like batteries, plastics, paper, clothing, and construction materials. 

In this episode, we explore how hemp is making a come back and the potential for cannabis businesses to leverage the re-emergence of hemp to build new revenue streams.

SPEAKERS

Taylor Evans, Jesse Larson, Adam Kulbach

 

Adam Kulbach  00:12

Hello and welcome to the higher enlightenment podcast brought to you by higher yields cannabis consulting your seed to sale Business Solutions team. My name is Adam, your host part of the creative team here at higher yields. And today’s episode is the pressure of the market hemp. Historically, hemp went through a terrible chapter where it was falsely equated with cannabis and all the allegedly harmful effects of cannabis. Fearful parents and community leaders did everything they could to keep cannabis and by extension, hemp out of their communities. Now, hemp is starting to win back its reputation little by little. The industry is making major strides by proving just how diverse and valuable hemp is, including by leveraging the powers of the plant to create sustainable versions of everyday goods like batteries, plastics, paper, clothing, and construction materials. In this episode, we explore how hemp is making a comeback, and the potential for cannabis businesses to leverage the reemergence of hemp to build new revenue streams. So let’s get on with the show. Well, let’s start by having you guys introduce yourselves. Let’s start with you, Anthony.

 

Taylor Evans  01:30

Absolutely. I mean Anthony Jenkins of the director of business development with higher yields than responsible for connecting the market to higher yields and higher yields to the market, making sure that proper resources and dividend businesses are being developed to our clients vision and point what they did with their anticipated results.

 

Adam Kulbach  01:50

Thanks. How about you, Jesse?

 

Jesse Larson  01:52

I’m Jesse Larsen. I’m the director of design, build and systems implementation I handle. Everything from ground up builds to retrofits of facilities to international supply lines and shipments and grant procurement.

 

Adam Kulbach  02:07

Okay, thanks. How about you, Taylor.

 

Taylor Evans  02:10

Hi, my name is Taylor Evans. And I’m the client support Advocate here at higher yields and excited to talk through more pressure of the hemp market.

 

Adam Kulbach  02:20

Okay, thanks. On to the first question. What happened to hemp all those years ago? And why did it go on tap for so long?

 

Taylor Evans  02:30

That is a phenomenal question. It really really is. Diving into some research and diving into certain things. It’s pretty interesting that that plants along with cannabis, the THC side of things got demonized and thrown into like the same, the same pot, no pun intended. But when you take a look at certain things that have occurred in our history, especially with you know, understanding when hemp was removed from the marketplace, back in the 20s 30s. Sherman Williams, for example, had to remove hemp as a binding agent binder binding element and their paints was natural, it was organic, it was and it worked very very well. So when they had to remove him because the federal government made it illegal, you know, things like they had to put now lead in their paints. And so of course a an alternative that we know today is is not good. Same with same with insulation have was used as an insulation insulating factor in building building materials and that sort of thing. And from what I understand and what I’ve read that the insulation organizations like Owens Corning and those like that had to remove hemp from their insulation products and then replaced it with asbestos. So what have what happened to hemp? That is a very good question because you know, back to the days when, you know, when early colonization and growing hemp and using it for paper using it for pretty much every everything, you know, it was suddenly can clothe you, it could house you it could heal you and how we’ve gotten to a place you know, so yeah, that’s a good question, Adam, what happened? And I think that we’re really understanding now that for whatever reason, it was removed from, from our lives that you know, actually bettered our lives as opposed to you know where it is. You know, what the alternatives were?

 

Jesse Larson  04:47

Yeah, to piggyback off of that, when Anthony said, Yeah, back in 1937, under the marijuana tax act, making, making all hemp and can cannabis related products illegal under the federal statutes really put the market in a bind and created created a situation where our alternatives had to be sourced that weren’t necessarily better. And that’s something that we continue to see here and in the cannabis industry better newer is not always better. Sometimes the old ways to work just fine and it’s a funny thing looping back around with the farm bill back in 2018. Legalizing with hemp hemp legalization here within the US we’re starting to see a resurgence of it coming back into the mainstream and not only building products but binding agents, different types of sustainability, battery production, food, clothing, you name it, people are getting creative.

 

Adam Kulbach  06:07

How is hemp being used to replace batteries and plastics this seems too good to be true.

 

Jesse Larson  06:13

A lot of the components right now with several shortages that we’re starting to come up against in the in the well over the last 10 years have kind of culminated into the events that we’re coming into now. It really it’s it’s really been a long time coming for battery components themselves. It’s it’s in the cell portion of the battery main portion for for him batteries and the negative side cap which is going into hemp battery construction as a coin cell the other portions that I’ve been seeing a lot of applications or at least talk about applications is is in the larger battery storage it’s a little far away but the the brain power is definitely there and the right people are having the right conversations to

 

Adam Kulbach  07:14

to move forward. So it seems that you guys think that it’ll ramp up a lot in the near future

 

Jesse Larson  07:21

as well with increased Yeah, well yeah, everything is starting to increase at an exponential level, especially with space travel, I think the components with him are going to start making their way into not only not only the space and aeronautics industry, but more into general construction and household goods just just as a just just as a an instance a lot of the building materials that we use in design build right now are in short supply one because of the housing market here here within the US a lot of those components that go into houses are the same components that we use in the buildings that we put up well not all of them are the same there’s some overlap the and the vacuum is that is created within the market where were those products used to be needs to be filled at some point. And right now given the given the current market conditions and the the elements of the great resignation taking place across the US quite a few new entrepreneurs are popping up and one of the things that higher yields is is really proud of is our grant program and the procurement of those grants around a lot of of green construction materials and renewable energy. And that process has really opened up my eyes and I know a few other team members eyes on on what is going on out out just pasture our front doors and so it’s it’s a fun time.

 

Taylor Evans  09:11

Yeah, it’s crazy. I mean, people don’t even understand. It’s it bull continues to blow me away. Like how about this fun fact. Henry Ford’s Model T was was famously made partly from hemp bio plastic and powered by hemp biofuel. Right, so now that we have this element of these powered vehicles, right, battery powered vehicles to replace the combustible engine, they’re finding that the hemp cell hence batteries performed eight times better than lithium ion. And so and then there was a study in 2014 where scientists in the US found that the Waste fibers from hem crops can be transformed into ultra fast super capacitors that are better than graphene. Of course we understand and know what graphene is drafting is a synthetic carbon right material that’s lighter than foil but it’s yet bulletproof. But incredibly expensive. That head version is not only better, but it cost 1000s 1,000th of the price. I mean, so we’re in a we’re in a day and age where all of a sudden you know, you have this, this plant that was being used. Henry Ford Model T, right? Hemp bio plastic hemp biofuel, you’re gonna talk about clean burn. Right, but yet it was eliminated. By what reason? For what reason you dispose of a you disposable lithium battery. And it’s damaging it damages the environment, just like it does to extract it from the earth destroys it. So you have had batteries that don’t destroy the environment when they’re disposed. And the harvesting or the cultivation of hemp actually gives back to the earth. So we’re a five acre hemp farm can replace an entire clear cut of lumber of timber and replenishes the soil. Thank you be harvested. What Jesse? Three, four times a year.

 

Jesse Larson  11:46

I’ve seen it done a few different ways I’ve seen. Gosh, you can do it like every 90 days. There you go. Yeah. 369 12 Yeah. So at least at least four times a year. Yeah, at least four harvests a year. Anthony. You You’re You’re correct on that.

 

Adam Kulbach  12:07

Okay, well tell us about some of the other areas hemp has been used and expanded into, such as paper manufacturing clothing, textiles and construction materials. It just

 

Jesse Larson  12:19

keeps going. It really does. And especially with the the added benefit of being non THC, a lot of the regulations a lot a lot more people ease and by people I mean government officials usually ease their their their footing when it when it comes to talking about at least industrial hemp. The benefits were were we’re just hitting the the tip of the iceberg. And if it wasn’t for the prohibition starting in 1937, it’s and oddly enough, where higher yields is, is located in Denver, Colorado, I believe to two if not three of the first arrests and in for cannabis. We’re right here. And it’s all coming full circle to as Denver’s starting to lead the way back into cannabis. And so legally. Legally, we’re just hitting hitting the tip of the iceberg. And I think, as I said before, the the inroads especially when it comes to space and aeronautics is is and more than likely sea exploration is going to be pivotal in the next 2030 years. As as exploration ramps up, it’s going to be fun. One of the things that is is continuously coming up within the cannabis industry is the auxilary businesses and the industry supporting it. For instance, throughout the COVID 19 pandemic, the air ionization mechanisms coming out to not only clean the air and reduce odor for for cannabis facilities, but to kill pathogens within the air have become extremely prominent within cannabis as well as supporting industries around it. And that type of innovation and exploration that is coupled with it I see on the rise and for him in in every industry that it can make its inroads into

 

Taylor Evans  14:30

Yeah, I mean, it’s it’s amazing from building from lumber from insulation from flooring to sheet right drywall that has an insulation R factor that’s off the charts, from roofing products from I mean, it’s endless. It just continues to keep going. And the more that the plants is being studied, the more things that they’re finding out. I mean, like if you think about it, there’s no need to use fossil If you’re right, that are destroying the planet, right or climate, hence, biofuel provides not only a better alternative, right? But it doesn’t destroy the environment actually replenishes the environment. So the whole mean the whole aspect of what’s going on, and why there’s so much downward pressure on continuing to suppress this amazing plant in the hemp industry, right. And it’s not just for, you know, CBD lotions, even though we’re finding that nanotechnology and, you know, hemp processing and, you know, now makes more cannabinoids more bioavailable, you know, to the body to the system to our cannabinoid receptors that are actually in our body. Right? So it’s just one of those, it’s just one of those things that sort of baffles me.

 

Adam Kulbach  15:59

Okay, let’s expand a bit on why hemp was prohibited in the first place.

 

Jesse Larson  16:06

It it really got bad name, or bad rap at the end of prohibition, or excuse me, at the end of the Volstead Act, and the prohibition of alcohol within the United States, a new boogeyman had to become had to come to the forefront. At that time, there was a lot of talk around the influx similar to now from illegal immigration across the southern border. And one of the best ways to garner support for it was the the bringing of of the drug marijuana which was, which is just a slang term. It’s just a term for for Mexican tobacco, not even the real cannabis plant itself. And so like many other things that we’ve witnessed, not only through this, this current pandemic, but the, the narrative wasn’t wasn’t fully clear coming out of the gate. And, and a lot of now, now we’re seeing the ramifications of the the sweeping, sweeping bills and funding for legislation to incarcerate individuals over over the cultivation and consumption of a plant. And basically, for nothing else, other than lining the pockets of a few politicians and, and ensuring funding is is made available. And so I think, like many other things, without the correct information, people weren’t able to make the best, the best informed judgment on on what was going on. And, you know, now with increased communication, increased knowledge and increased availability to differing perspectives, we’re able to make better informed decisions for ourselves. And that’s being shown through state legislature and the domino toppling effect throughout the US that we’re seeing.

 

Adam Kulbach  18:15

Okay, thanks. Where’s the greatest potential for the organic hemp market?

 

Taylor Evans  18:22

greatest potential I really truly believe it’s an industrial hemp I think that market the market is already showing initial indications of doubling tripling you know, what the cannabis industry is?

 

Jesse Larson  18:38

Take any kid take any cash crop that was prime the primary for the 20th century whether it be corn and soy, those are my two primary that I first see some impacts going in on as well as what’s what’s another good cash crop? I mean, tobacco, tobacco is going to be taking a huge hit already. Taylor with fun, cotton good one.

 

Taylor Evans  19:09

Barley hurt is cotton virus.

 

Jesse Larson  19:14

Barley, perfect. Yes. Taylor with the wind and the on a cash crop cotton. You know, we we’ve seen what something and and the creation, so machinery created to produce and or excuse me to process cotton was one of the main investigations and one of the main boiling points for the American Civil War. And that that element there has always been a sticking point within the American culture. And so to be able to move away from that element in that stigma in more ways than one where it doesn’t have Be on the label, it doesn’t have to be at the topic of conversation. Those old rooms do not have to be ripped up anymore. And the ending of prohibition on on this cash crop, which is what it is, is is like Anthony was saying it’s monumental, and we’ve only reached the tip of the iceberg for it.

 

Adam Kulbach  20:23

So what advice would you give cannabis businesses that want to get into hemp,

 

Taylor Evans  20:28

be open minded, be innovative.

 

Jesse Larson  20:33

Do not do not get locked into one avenue, be open, be open to two options that are going to come down the line and, and yeah, the creativity portion. That’s where That’s where we’re going. We’re going to be and not just for him, but I mean, in every every level of the cannabis industry, now’s the time where, where people have to be creative, because it’s no longer about who can grow the most. It’s about who has the best product, who has the best story who has a well put together business that takes care of their employees as well as their customers, and still provides a superior product to their competition. And so it’s a lot more elements are coming into play. And it’s the explosion of professionalism as well as involvement from outside industries that people may not think are involved in cannabis. There are a couple while I won’t mention direct names, religious organizations that that own quite a bit of farmland that that hemp is grown on. And so there’s there’s good there’s quite a bit of once you start peeling back that onion is as Anthony likes to say, the layers, they get quite involved. And yeah, tip of the iceberg tip of the iceberg with with what’s happening right now.

 

Taylor Evans  21:56

Right. And that’s the thing that I mean, higher yields can really help in that regard, to help innovate to help actually move out of just the agricultural side, and move into some product creation, developing certain elements and certain products that can be retail, not not being opposed to moving into industrial side of things, and creating ecosystems to create those key partnerships that are going to help them thrive, you know, in the marketplace, as opposed to saying very narrow minded in you know, I’m going to harvest this crop and who wants to sell it or wants to buy it? And so, that’s, you know, that’s really where, where we come in to help innovate and educate and help provide that path to, you know, not only to health and welfare, right? But also revenue and profitability of their farms, or whatever that is they did.

 

Adam Kulbach  23:03

Okay, if someone is not yet in the cannabis industry, but is considering it, would you recommend that they get into hemp instead? And why or why not?

 

Jesse Larson  23:17

Well, the plant itself, while similar has many different facets and different elements of care that need to be undertaken to get it to a desired effect. Now, if you want to grow hemp, get some farmland. subtropical climates are the best areas in which to grow it. No pun intended, but it grows like a weed. So get it in the right climate and you’ll be alright. It’s a great addition to farm current farmlands. However, more northern climates, you’re going to have to start moving into more indoors. colder it gets, the thicker those walls need to be. It might turn into solar panels, having solar panels on your buildings is always a good bet to hedge against energy costs. The same way industrial hemp will more than likely be used to hedge against component problems for construction materials and industrial industries. The if the market continues in the direction that we’re anticipating we’re going to need more hemp farms here in the US. And it’s going be going to be something that I think it just in general we’ve had kind of a tipping a pendulum swing in the wrong direction where we don’t we’re running out of farmers in a lot of ways. The government is putting a lot of money especially in the grant area into farms. And so if anybody is interested in is an option out there. But yeah, yeah, if they if you feel that it’s going to be a healthy hedge in the future, look into it, look into your local regulations and look to see if, if it’s easy to grow in your area, then try it out.

 

Adam Kulbach  25:18

Okay, so how can higher yields help those who want to get into the hemp business?

 

Taylor Evans  25:24

Well, yeah, definitely from a I mean, a feasibility assessment evaluation standpoint? Absolutely. I mean, in terms of how to answer the market, you know, what the budget roadmaps are going to be really developing out, not only feasibility of of their direction or their vision that they have, but also, you know, creating that that roadmap based upon options and recommendations based upon the temperature of the market, their capacity for innovation, their capacity for creativeness, like we were talking about before. And we can really help lock that in. And even on the back end. And maybe Jessie wants to touch on this a little bit in terms of our ecosystems that we built over the value chain, and being able to move in a direction to help not only cultivate and grow, but manufacture produce products, and even, you know, the retail element moving from a wholesale environment or retail environment, and really, you know, locking in on the growth of this industry.

 

Jesse Larson  26:32

Yeah, and and especially as, as things continue to move move in the direction that that we’re anticipating. Federal Well, full federal legalization, I think is a is a pipe dream. Federal decriminalization I think is a more realistic aspect. And given some of the current political climates and situations people may find themselves in the midterms, I wouldn’t put past the current administration to at least have some type of deal on the table. And so the international opportunities that are going to arise when when they inevitably do will need to be capitalized on and should be capitalized on When, when, when the opportunity happens. being set up for that right now. It’s always good to be prepared. And, and so, yeah, yeah, be prepared for what’s more than likely going to what’s better than not coming down the pipe and be ready to jump into that game, not only within the United States, but it’s going to be international.

 

Adam Kulbach  27:45

Okay, that’s about all the questions that we have for today. Does anybody have any final thoughts?

 

Taylor Evans  27:52

I say we keep pressing on you, we keep building building this industry, building this business, you know, building this opportunity, you know, one business at a time. And connecting dots, both nationally and internationally. I think we’re seeing a groundswell that has an impact. I mean, even from the standpoint the Dutch are rebuilding homes out of out of hemp, so it’s an international game. And, you know, we let’s, you know, be on the forefront of that innovation. I agree.

 

Adam Kulbach  28:26

Well, thank you so much, everybody, for being on the podcast today. I really appreciate it. That’s great. Well, thank you folks for listening to the higher enlightenment podcast. For more information about our podcast, check out the information below. If you have suggestions for future shows, or you’d like to be a guest on the higher enlightenment podcast, get in touch through the information below, or please call us at 844 High yield. That’s 844 H i, why i e LD, please check out our website at higher yields consulting.com. And there you can listen to all our previous podcasts. So until next time, thank you very much for listening. Have a great day. And we’ll meet again soon