Category Archives: International

The great race to become the World’s weed supplier

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Submitted by Marijuana News on Fri, 10/11/2019

Companies vying to be the biggest cannabis producer in America or Canada are wasting their time and suffering from a crippling lack of vision. The real play is to make a bid to become the worldwide leader in global cannabis exports — like firms in Jamaica and Lesotho as well as Canada are attempting to do — and the window of time to get in is closing fast, according to one entrepreneur with clear-cut plans to curb that market.

Though recreational cannabis is now available in two countries, medical marijuana is legal in about 50 and not every country produces adequate supply to fulfill domestic demand. Over the long-term, the thinking goes, cannabis will become like any other agricultural commodity and production will shift to the locale where costs are lowest. But so far, the limited export game has been dominated by a few players, most of whom are either occupying a very limited lane or banking on the future.

An example of the former, Bedrocan in the Netherlands, produces cannabis solely for the government authority, which then exports most of it to Germany. Bophelo Bioscience and Wellness, a startup recently acquired by a Canadian-firm and based in tiny Lesotho, the first country in Africa to legalize cannabis, is an example of the latter. Somewhere else is a company like Fotmer Life Sciences in Uruguay, which is hoping to supplant both.

The world’s most popular illicit drug, cannabis boasts at least 263 million users worldwide, according to a New Frontier Data estimate, who in turn consume $340 billion worth annually, most of which is still on the underground market. At the moment, with so few legal companies producing cannabis and even fewer exporting, it’s a seller’s market. That state of play — flux, uncertainty, opportunity — will last only about another five years, said Jordan Lewis, an American entrepreneur who is Fotmer’s CEO.

Fotmer was in the news much last week as the company prepared its first shipment of export cannabis: 22 pounds, headed for medical cannabis patients in Australia. After that, Fotmer hopes to start competing with Bedrocan and begin shipping cannabis flower and oil to Germany, with up to 220 pounds or so per month headed out of the country to global customers, as he told Reuters.

Most of that will go to Europe, which “right now represents the single largest market in the next five years,” Lewis told Supplychainbrain.com.

The window for producers to charge high prices, before a reliable global supply floods the market, is now through 2024, he added, with high THC oils and plants to preserve their value longer than CBD products.

The modest first shipment is a tiny fraction of the company’s capacity. Fotmer currently has government approval to produce up to 10 tons of flower and 5 tons of oil, said Lewis — who added that he’s asking the Uruguayan government to allow him to grow 15 times that, in order to curb that global market. (He’s also shopping for a “large strategic partner” to provide the estimated $60 million of start-up capital needed to grow all that cannabis.)

If Lewis is right and producers in other companies join in, Fotmer may be well positioned to remain competitive, an outlook shared by other analysts. As New Frontier Data noted in a global market analysis released earlier this year, South America is considered a future hub for cannabis production thanks to an agreeable climate and low labor costs.

If countries decide that domestic suppliers are preferable and throw up tariffs, Lewis’s play could disappear. Or perhaps the best praxis is to play off of the incredible hype around the cannabis industry and get acquired. The point is that in a world obsessed with the next big thing, cannabis is very quickly approaching critical mass, and entrepreneurs are slowly catching on.

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Authored By: Cannabis Now

Article category: Marijuana Business News

Amid regulatory uncertainty and global demand, China’s hemp industry is booming

Submitted by Marijuana News on Tue, 10/08/2019 – 10:38

China has a zero tolerance approach to marijuana (along with numerous other drugs), yet surprisingly it is the world’s largest producer of hemp, and also the world’s largest exporter of this increasingly lucrative plant.

While chances of medical marijuana being legalized in China are seemingly next to none, calls for a clear policy when it comes to industrial hemp and CBD products are increasing — as is the plant’s production in the country.

While cannabidiol (CBD) has become as widely proliferated as over-the-counter painkillers in the West, products using this hemp-derived compound have yet to be seen stocking store shelves in China. The plant it originates from, however, has had a far lengthier history. Ma (麻), the Chinese word for hemp, has actually been in use for thousands of years, widely enough that the classic text Book of Odes, or Shi Jing (诗经), contains many references to hemp use in the daily lives of Chinese people from the 11th to 7th century BCE.

The cultivation of hemp was made illegal in 1985, despite China having a long history with the crop. It was only in 2010, after a push by locals, that authorities again allowed it to be grown on an industrial scale in Yunnan province in southwest China.

Marijuana plants containing the psychoactive agent tetrahydrocannabinol (THC) are to date resoundingly illegal within China — despite what Randy from South Park might think — but plants containing quantities of CBD fall into a grayer area.

As it stands, companies are allowed to farm industrial hemp in Heilongjiang and Yunnan provinces (in China’s northeast and southwest respectively). China Daily reported early this year that talk of farmers being allowed to grow industrial hemp in Jilin province (next door to Heilongjiang), which had begun in 2017, had proven fruitful. Additional sources attest that hemp is also legally being grown in regions such as Anhui, Gansu, and Xinjiang.

Figures provided on Hanma Industrial Group Co. Ltd.’s website — one of China’s leading hemp producers — show that half a million hectares of land were used to grow hemp in Anhui province, close to Shanghai in eastern China, in 2014. Other provinces, excluding Heilongjiang and Yunnan, accounted for 0.4 million hectares. Curiously, many media outlets fail to report these facts.

This confusion as to the location of hemp farms in the country is perhaps related to the distinctions of industrial hemp. Industrial hemp is a marijuana plant (cannabis sativa L. subsp. sativa var. sativa) specifically bred to contain the least amount of THC possible, and has a wide range of applications. Industrial hemp is the most commonly farmed hemp strain, although China is home to hemp plants from 33 families and more than 90 genera, including ramie, flax, jute, kenaf, sisal hemp, and abaca.

With that being said, police have historically targeted marijuana plants grown outside of the industry complex. This year, for instance, authorities eradicated 10,000 wild plants growing alongside the Yongding river in Beijing’s Fengtai district.

The mood at the Industrial Cannabis Forum of Listed Companies in mid-August was pragmatic in the face of such continued confusion over regulations in the industry. Participants called for more clearly defined policies on the issues, while Yuan Hua, general manager of Kunming Pharmaceutical Group, said that China’s cannabis industry will need an additional two to three years’ time to establish itself. Her suggestion for companies in the meantime was “research and development,” in order to create new pharmaceuticals and products and lay the groundwork for the future of the industry.

With the recent rise in products containing CBD around the globe, Chinese hemp farmers and companies have begun to turn their attention to cosmetics, pharmaceuticals, beverages, and other products that use CBD in some form.

Tan Xin, chairman and founder of Hanma Investment Group Co. Ltd., tells us: “We did a lot of research in the early days and saw that investors like Peter Thiel and George Soros had put money into this industry. We believe this business has huge potential.”

As an example of the potential lucrative nature of this industry, consider that July to late September/early October is usually harvesting season for hemp plants in China. As more companies seek to gain a foothold in this fledgling market — and news of developments like the legalization of industrial hemp farming in Jilin province has spread — stock prices for firms such as Dezhan Health and Meiyingsen have soared this year not only during harvest time, but since the beginning of 2019, prompting international media outlets like The New York Times to sit up and take notice.

Yet in a move that perhaps put a damper on the industry, the Chinese National Anti-Drug Committee published a release in mid-March earlier this year re-clarifying the country’s stance on industrial hemp farming. The release plainly stated that CBD is not included on the list of narcotic drugs in the country, and that it is not a controlled drug. It also stated that marijuana with a THC content of 0.3% or less can be grown in certain parts of China. While this release certainly clarified parts of China’s stance on CBD, it was also vague in many areas and had a negative effect on multiple stocks on Chinese exchanges, prompting investors to sell off.

Nonetheless, people like Tan are optimistic about the future of CBD in the country, particularly in the beauty industry. “Nowadays, CBD is considered an ‘all-purpose ingredient’ [for beauty] in the Western world,” says Tan. “It not only has a therapeutic effect on skin diseases, but is also effective in terms of oil control, acne, and skin whitening.

While research and development for all types of products using CBD is technically legal, only beauty products with CBD are legal to sell in China.

“Since 2015, ‘hemp leaf extraction’ can be legally used in cosmetics,” says Tan. “And because the cosmetics industry is so huge in China, we have a good shot in this business.”

He adds however that pharmaceuticals and health products remain the company’s biggest priority at the moment.

All of this points to the crux of China’s argument for the widespread legalization of industrial hemp farming and CBD use in medicine: health.

Many tout the benefits of CBD in treating conditions like epilepsy and Alzheimer’s, as well as providing pain relief, though research on some of these claims is as of yet inconclusive. According to a report by Global Times, China holds 309 of the world’s 606 hemp-related patents, but due to legal restrictions, Chinese-made food and medicine containing CBD can only find a market outside of the country, in places like the US and the EU.

As Tan puts it, “the hemp industry is a health industry. Nothing will keep us from the pursuit of health.”

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Authored By: Radii China


Thailand’s Legendary Marijuana

Thailand's Legendary Marijuana

Recently, there have been signs that the Thai government is softening its stance on marijuana.

By Peter Maguire

April 30, 2018

For decades, Thailand was one of America’s most resolute allies in the war on drugs. After zero tolerance policies left the Kingdom with the highest rate of incarceration in Asia and a methamphetamine (ya ba) epidemic that not even the most draconian measures could stop, Justice Minister Paiboon Koomchaya shocked the nation in 2016 when he conceded that “the world has lost the war on drugs.” Not only did he suggest legalizing methamphetamine, Koomchaya urged his countrymen to view the drug epidemic through the lens of public health, rather than law enforcement. Today, many hope that this new laissez-faire approach will lead to the legalization of the legendary marijuana that was once among the Kingdom’s most famous and valuable exports.

After the United States built military bases in Thailand during the 1960s and stationed tens of thousands of U.S. soldiers there, the marijuana industry exploded and cheap, powerful pot became as readily available as beer.

“They tie together. Put the stick. Make it nice. Sell for GI easy. One, two, or five for one dollar,” recalled a Thai smuggler who got his start selling pot to U.S. soldiers. “Whatever place GI go, it started whenever they need.” 

“With an eighty-cent bottle of gin purchased at the PX,” one Vietnam veteran remembers, “you could trade for a pack of twenty Thai sticks.”

Thai Sticks c. 1974. Photo Michael Ferguson

The first Thai marijuana to reach the United States came in the 1960s via the Army Post Office. The difference between Thai marijuana and most Vietnamese and Cambodian cannabis, was the difference between bathtub corn whiskey and single malt scotch. In 1967, one amazed DEA agent to called it “the Cuban cigar of the marijuana world.”

“Who can forget the first strange-looking Thai Sticks a decade ago! Dense, seedless, stronger than a bull elephant. Years before sophisticated sinsemilla techniques were incorporated into the crop management of U.S. growers,” wrote High Times magazine, the journal of record for pot connoisseurs, “the Thais were, without effort, turning out a superior product.” What sold for $3 per kilo at the farm in Isan, easily fetched $4,000 a kilo in any city in the United States in the early 1970s.

The foreign demand for marijuana produced a boom in Thailand’s poorest region during the 1970s and 80s. North of Udorn on the banks of the Mekong sits Isan, a plateau as large as many American states (62,000 square miles) that floods during monsoon season and is arid and dusty during the dry season. Although rice fields are hard to irrigate and do not yield much, marijuana thrives thanks to the Mekong River, whose tributaries replenish the region with rich, silty soil. Farmers in Northeast Thailand take the same care with their cannabis plants that French vintners take with their grapevines.

“They know how to grow so nice, I mean how to take care of the flower, how to take out the male plant,” said one retired Thai marijuana broker. After they harvested and dried the cannabis sativa flowers (buds), the farmers and their families neatly and uniformly tied them to small bamboo sticks and secured them with threads of hemp fiber. 

What made the criminalization of marijuana particularly difficult, not just in Thailand, but certain parts of Southeast Asia, was that it was considered little more than a medicinal or cooking herb with little or no local legal or moral stigma attached. The plant had grown in Thailand, Laos, Cambodia, and Vietnam for centuries and various preparations were used to treat:  migraine headaches, cholera, malaria, dysentery, asthma, digestion, parasites, and post-childbirth pain.

“Almost every corner, every house, they have it in the yard growing. The older people, they will like it. The working heavy guy, he will like it,” said one retired Thai grower, “but they use for medicine also, when you really feel fever. So if you have nothing there, you can get like one branch, and ground it up.” 

Under Thailand’s 1934 Marijuana Act, penalties for any amount of the plant could not exceed one year in prison. When criticized by American officials for tolerating cannabis, Thailand leaders were quick to remind them that drug abuse was not part of their culture.

“The United States has been able to send men to the Moon. It has built sophisticated weapons for its own defense. Why can’t it do anything effective about narcotics getting to its shores,” Prime Minister Kriangsak Chamanan said in 1977. He reminded the Americans of the rules of capitalism, “Where there are markets, there is bound to be trade, either legal or illegal.” This point was echoed by Alfred McCoy, in his magisterial study, The Politics of Heroin in Southeast Asia, “Driven by myopic moralism, U.S. policy ignores the fundamental dynamics of the drug trade. Over the past two centuries, narcotics have become the major global commodities that operate on fluid laws of supply and demand not susceptible to simple repression.” 

A load of Thai Sticks Intercepted by Thai police. Photo Bangkok Post.

During the 1980s, the U.S. government was able to convince and coerce Thailand to partner with them in a war against marijuana. In 1988 alone, the U.S. Coast Guard intercepted eight “motherships” that carried 463,000 pounds of Southeast Asian marijuana bound for American shores. However, in the end, the “victory” was Pyrrhic because Thai drug users replaced cannabis with methamphetamine that is today responsible for 90 percent of that nation’s drug arrests.

Recently, there have been signs that the Thai government is softening its stance on marijuana. A research team at Rangsit University received permission from Thailand’s Narcotics Control Board and made a cannabis extract spray for cancer patients. In April, Dr. Arthit Uraitat, the rector of Rangsit University, called on Thailand’s military leaders to legalize medical marijuana.

“Be brave. Let us use medical marijuana legally regardless of the method,” he said in a press conference, “Those who have cancer, they cannot wait. They need the help now, so I think we need to take every shortcut possible.”

Last week, a private company called the Thai Cannabis Corporation announced the start of a five-year cannabis project that will cultivate 5,000 hectares (12,355 acres) of the plant in the next five years. The Royal Project Foundation will oversee this effort and Maejo University will provide research support. Thai Cannabis Corporation’s objective is to establish a low-cost model to grow, harvest, and process cannabis plants into oils and extracts. Initially, they will focus on breeding high CBD (cannabidiol) cannabis strains that contain minimal amounts of THC (tetrahydrocannabinol) in order to comply with the laws of Thailand. “The mission of the Royal Project Foundation is to research and develop appropriate technology to sustainably improve the quality of life for Thailand’s highland communities. I quite agree with the Thai Cannabis Project,” said the director of the Royal Project Foundation Dr. Vijit Thanormthin. 

The Royal Project Foundation was established and funded by King Bhumibol Adulyadej in 1969. An early advocate of sustainable farming, the king sought to improve the quality of life of Thailand’s hill tribes by replacing opium with other crops and also revitalizing Thailand’s forests and safeguarding their water resources for future generations.  Cannabis fits very neatly into the Royal Project Foundation’s mandate given that Thailand’s hill tribes were once the world’s premier marijuana growers. The nation is already exporting packaged food, beverages, essential oils, pharmaceuticals, medical devices, and cosmetics. Why not marijuana?

While the Thai Cannabis Corporation hopes to include the marijuana that Thailand was once world famous for in their product line, they will only go as rapidly as the law and Thai government will allow. “The mission of the Thai Cannabis Corporation,” said CEO Timothy Luton, “is to provide an excellent return to shareholders by partnering with Thailand’s farmers and scientific researchers to make, at high volumes and affordable prices, cannabis products that are above reproach.”

Thailand’s slow shift towards marijuana legalization stands in stark contrast to America’s anarchic “Green Rush,” the greatest exhibition of human greed since gold was discovered in California in 1849. Unlike Vietnam, Cambodia, and Laos, a foreign army has never occupied Thailand and they have staved off foreign invaders for centuries. Generations of Western businessmen have been baffled by their unique and refined Buddhist sensibility that often seems to value mental equilibrium and social grace as much as profit. 

However, behind the smile and behind the wai are some of the toughest people on earth. Rapacious western marijuana speculators looking to get rich quick would be wise to heed the words of Townsend Harris, the American envoy to Siam (Thailand), who wrote in 1856: “It is an old saying here [in Bangkok] that those who come here for business should bring one ship loaded with patience, another loaded with presents, and a third ship for carrying away the cargo.”

Peter Maguire is the author of Thai Stick:  Surfers, Scammers, and the Untold Story of the Marijuana Trade, Facing Death in Cambodia, and Law and War: International Law and American History. He has taught history at Columbia University, Bard College, and the University of North Carolina Wilmington.

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https://thaicannabiscorporation.com/