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The Billion Dollar Industry In Cannabis' Shadow - Mushroomstocks | Mushroomstocks
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The Billion Dollar Industry In Cannabis’ Shadow

Jul 10, 2017 • 4:53 PM EDT
Hemp (1).png
5 MIN READ  •  By Michael Berger
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Derek Thomas – Analyst

For the last few decades, medical and recreational cannabis have been getting the lion’s share of political, media, and financial attention. But just as important for the continued growth of a greener humanity is marijuana’s closest relative and long-time dominant member of the cannabis family: industrial hemp. Let’s take a brief look at hemp’s history, its current regulatory status, the industry as it exists today, and why hemp is beneficial to humanity.

Believed to be one of the founding crops of civilization, right alongside wheat, barley, rice, and papyrus, hemp has been grown for thousands of years. The oldest known industrial hemp crop was grown in ancient china over 10,000 years ago. It has since been grown by almost every major civilization for a variety of purposes. Most civilizations took use of many of the benefits of hemp. For example, the Chinese used it both as a medicine and for clothing. The British used it for clothing, sails, rope, paper, and as a narcotic. The Egyptians used it as a building material and as a food. The roots of our civilization are intimately entwined with the roots of hemp; and it has only been the last 100 years or so that marijuana – and subsequently hemp – have been demonized.

Before understanding the current regulations surrounding hemp, it’s important to remember that hemp has an incredibly low amount of THC –usually around .3 to .5 percent. It is not a sufficient amount to be smoked or even concentrated into higher amounts. This is mostly because of the strains used to grow hemp and the growing techniques. The attributes of these strains are often focused on the strength and length of the fibers, and not THC count. Marijuana plants are grown short and far apart and the techniques encourage wide, bushy plants that produce lots of buds (flowers). Hemp is often grown very tight and very high – they actually look like two completely different crops. There are chemical, genetic, and gender differences between hemp and marijuana plants.

The federal government is either corrupt or inept when it comes to crafting regulations based on these scientific understandings of industrial hemp. Hemp is still illegal and classified as a schedule 1 narcotic alongside its cousin marijuana. Some pioneer states have legalized industrial hemp; Colorado, Arizona, North Carolina, and Kentucky are a few on the forefront of reclaiming an American agricultural tradition of growing hemp. Others are lining up as well. But often these states fumble around with legislation, placing unfair testing costs and regulations on farmers. Others require farmers to grow in conjunction with universities for ‘research’ purposes which impedes monetization, lowering the desire for farmers to explore growing hemp. The real hurdles are still the federal legislation though. Where marijuana can survive and thrive on cash-based verticals in micro-ecosystems contained inside states, hemp cannot. Imagine being able to grow corn in Nebraska but not move it across state lines to be processed somewhere else! A marijuana grow house can get a cash investor and a security company as a bank, a farmer cannot! In order to have a truly thriving hemp industry there needs to be national legalization followed by proper investment and subsidies at least until the processing infrastructure is in place.

Starring in the face of these massive hurdles facing the hemp industry, brave American entrepreneurs and farmers are reclaiming their roots and their rights to this incredible crop. Despite the federal legal status of hemp, the United States is the largest importer of hemp products – with almost $1 billion imported every year and growing. A few industries are poised to retake the American market share back with innovation and authenticity. Textile brands are creating top of the line hemp clothing in Los Angeles, and incorporating more American grown hemp each year. Food is one of the fastest growing segments, with one entrepreneur and his brand Evo Hemp were even named to Forbes 30 under 30 class of 2017! Everything from energy bars to protein shakes have been introduced by American brands. An often-underestimated segment that is beginning to take off are industrial applications like hempcrete and bio-plastics! I recently signed a contract with a hemp pen, printed on hemp paper!

Perhaps some of the most exciting and innovative developments that are taking place are in nutraceuticals. Hemp can produce high quality CBD Oil and Hemp Oil which both have outstanding health benefits. Topically, they can moisturize the skin, reduce inflammation, and treat a variety of dermatitis conditions. When ingested, they can improve cognition, treat inner inflammation, reduce chronic pain, treat a variety of neurologic seizure disorders, provide beneficial omega 3-6-9 fatty acid and antioxidants, and reduce stress – just to name a few! Brands like Sansal Wellness and many others are at the forefront of providing high quality CBD and Hemp Oil products while also educating consumers about the benefits and fighting for the right to grow hemp here at home!

So far, we have really just discussed why hemp has been beneficial to economies and how it is beneficial to our bodies. But wait, there’s more! Hemp is great for the earth too. Its naturally organic, requiring to pesticides, herbicides, or fungicides to grow. It doesn’t even need fertilizer! Hemp is also incredibly efficient; using much less water than cotton and most food crops, growing just about anywhere, and producing 3X the amount of biomass compared to other crops – meaning with little to no harsh resources you get three times the yield! And it actually is good for the soil, adding nitrates back into the ground making it an excellent rotational crop. It acts as a filter for the soil too, pulling out heavy metals, toxins, and radioactive isotopes. Hemp is currently being grown around both Chernobyl and Fukishima to help heal the soil.

The most tragic part of the hemp story is that, because of regulations, it has missed out on the last 100 years of technological innovation: which has been the most innovative of our history. We have over 1,200 patents on corn alone – yet a lowly 200 on Hemp. Considering all the above-mentioned benefits and uses, imagine if it was legal and had full funding for research and development. Hemp can feed, clothe, move, and shelter humanity while healing the earth – we just need to give it a chance.

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Authored By

Michael Berger

Michael Berger is Managing Partner of StoneBridge Partners, LLC and Founder of Mushroomstocks.com. Prior to entering the cannabis industry, Michael was an Equity Research Analyst at Raymond James Financial covering the Energy Sector. Michael has been featured in publications such as The Street, Bloomberg, US Money News, and hosts various cannabis events across North America.


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