Delta, Canada-based Village Farms International (TSX: VFF) (NASDAQ: VFF) has agreed to form a joint venture with Nature Crisp for the outdoor cultivation of cannabidiol (CBD) hemp and CBD extraction in multiple states throughout the U.S.
Village Farms is one of the largest vertically-integrated greenhouse growers in North America and the only publicly-traded greenhouse produce company in Canada.
Georgia-based Nature Crisp is a privately-owned farming firm. It is part of Jennings Group which grows a food and other crops, including hemp, on more than 6,000 acres in the U.S. and Canada.
The joint venture, Village Fields Hemp, will be 65% owned by Village Farms and 35% owned by Nature Crisp. Under the JV agreement, Village Farms is investing about $15 million for start-up costs and working capital in the JV.
Village Fields is finding locations where it will initially establish its hemp cultivation and CBD-extraction operations. The JV plans to start hemp field cultivation in spring 2019 and to have 500 to 1,000 acres in production during 2019.
Further, Village Fields plans to have extraction capabilities in place by the end of 2019 so it can begin supplying CBD oil on a wholesale basis. It wants to commence production of branded CBD products for big box retailers in 2020.
“Since passage of the 2014 Farm Bill, we have recognized the significant potential for hemp and hemp-derived CBD, and have immersed ourselves in understanding the hemp plant and applying and refining our proven cultural practices, gaining profound knowledge with our 300-acre field crop last year,†Phillip Jennings, III, chief business officer of Village Fields, said in prepared remarks.
Phil Jennings IV has been appointed as CEO of Village Fields.
Village Farms says that it is monitoring developments in the Texas State legislature regarding the legalization of commercial cultivation of hemp and hemp-derived CBD products in the state.
The company owns and operates 5.7 million square feet of greenhouse facilities in West Texas, known as one of the best growing climates in the U.S.
If Village Farms were to convert its Texas operations to hemp production, they would BE the largest greenhouse hemp production footprint in North America, according to the company.
Last month, State Rep. Roland Gutierrez introduced a bill to legalize hemp products in Texas, as reported by CBC Austin. House Bill 1657 would make production and distribution of hemp products in the state. Texas is looking to join 40 other states that have passed similar legislation.
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