Lack of hemp seed has led to the closure of a hemp seed processing plant in Vermont, Victory Hemp Food, which used to produce hemp seed oil and hemp flour has either sold its equipment’s or transported them back to Kentucky.
Northeast Hemp Commodities, a company which specializes in CBD extraction in Vermont, took over space previously occupied by Victory Hemp. The company plans to use the space for CBD extraction, manufacturing and retail sales of CBD products.
The CEO of Victory Hemp Food, Chad Rosen, said that they had to close down the Middlebury facility because farmers in Vermont and neighboring states grew hemp for CBD thus forcing the company to incur high costs of shipping hemp seeds from North Dakota and Wisconsin, which was impractical as the company was making less and lesser profits.
To cultivate hemp crops with high concentrations of CBD extracts and other cannabinoids, the plants had to be feminized.
Anson Tebbetts, the agriculture secretary, said that they were sad to see Victory Hemp leave Vermont and that in future he expects to see the seed oil industry grow as the hemp industry matures and for farmers to embrace the transitioning from hemp for CBD.
Victory Hemp sat on an 8,000 square foot facility on Exchange Street which was acquired from Full Sun. Full Sun was also a hemp seed processing company that closed its doors back in 2017. With the help of a loan from Vermont Community Loan Fund which they are still paying off, Victory Hemp purchased Full Sun’s pieces of equipment. The good news is that it is expanding its headquarters in Carrollton, Kentucky.
According to Rosen, the company shifted from using pouches to pallets which led to a rapid increase in sales. He said that from the last quarter of 2018 to the first quarter in 2019 their sales had doubled, a trend which continued from the first quarter of 2019 to the third quarter.
One farmer who hoped to supply Victory Hemp with hemp seeds could not harvest his crop because his neighbor, who has a combine harvester refused to lend him saying that his soybeans would smell like weed. Another farmer, Sam Bellavance who had 10 acres left his crop to rot in the ground. He said that the 70 cents per pound the company was offering for seed was not worth his crop. Bellavance later switched to growing hemp for CBD on 15 acres.
According to the founder of Vermont Smoke and Cure in Hinesburg who is now working as the CEO of Victory Hemp, Chris Bailey, for farmers to grow hemp as a grain and realize profits, they need to have thousands of acres of grain, storage bins, driers and combine harvesters.
This will be possible 15 years into the future, said Bailey, because as it is, the price of dried hemp used for CBD extraction is plummeting due to the increased number of farmers growing hemp for CBD.
Experts believe that hemp industry players like VPR Brands LP (OTCQB: VPRB) and Earth Science Tech Inc. (OTCQB: ETST) expect the supply of hemp for purposes other than CBD extraction to increase as the CBD sector matures and prices level off.
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