Why the U.S. Farm Bill Changed the Balance of Power In Global Hemp Market

PALM BEACH, Florida, June 12, 2019 /PRNewswire/ --  Last year's Farm Bill started a process in motion that is continuing to grow and rise like a tsunami. Removing Hemp from the Controlled Substance list created what an industry report by New Frontier called, a 'financial domino effect". Hemp CBD is different from marijuana CBD. Hemp CBD oil is extracted from the cannabis varieties that are naturally abundant in CBD, and low in THC. Marijuana on the other hand, is composed of a vast majority of THC and very little THC.   A study by New Frontier said: "The passage of that bill started to restore industrial hemp to nationwide legal production for the first time since World War II, offering vast opportunities for the industry and investment in a market expected to triple in four years total U.S. hemp industry now looks to expand at a healthy 18.4% through a 5-year combined annual growth rate (CAGR) from 2018-2022 in leading all hemp product categories, the hemp-derived CBD market will grow from a $390 million-dollar market in 2018, to a $1.3 billion market (or 3.3x) by 2022, representing a 27.2% 5-year CAGR.  Active companies in the markets this week include:  Canbiola, Inc. (OTCQB: CANB), Marijuana Company of America, Inc. (OTCQB: MCOA), PotNetwork Holdings, Inc. (OTCPK: POTN), Medical Marijuana, Inc. (OTCPK: MJNA), Kona Gold Solutions, Inc. (OTCPK: KGKG).

More broadly, the passage of the Farm Bill represented a sweeping change in the balance of power in global hemp markets. The United States has historically been an importer of hemp products from Canada, Europe, and China. Now, with the Farm Bill as its tailwind, the U.S. hemp market will expand to lead the global hemp industry by 2020, representing 32% of a 5.7 billion global market in 2020.  As the U.S. hemp industry matures, it will transition from being a seed, textile, and industrial product importer to a global exporter. Until now, the U.S. has lagged behind countries like Canada and France with hemp legislation. With final passage, the Farm Bill aims the industry to accelerate and establish itself as a global hemp powerhouse led by hemp-derived CBD.

Canbiola, Inc. (OTCQB: CANB) BREAKING NEWS: Canbiola, a developer, manufacturer and seller of a variety of Cannabidiol (Hemp) based products such as oils, creams, moisturizers, chews, isolate, gel caps, and concentrate, announced today that his entered into a non-binding Letter of Intent (the "LOI") with Shi Farms, Inc. ("Shi Farms"), a licensed Hemp Cultivation Operation under the Colorado Department of Agriculture, operating a 300-acre farm and 40,000 square feet of research greenhouses to grow, cultivate, accumulate and process hemp in New York State under a license from Shi Farms.

For more information about Shi Farms, please visit: https://www.shifarms.com.

Pursuant to the LOI, Canbiola, and Shi Farms plan to create a joint venture to develop a "depot model" for hemp processing in New York ("NY Depot"). Canbiola would manage and direct the NY Depot, where fully grown hemp harvested by third-party cultivators would be purchased and stored by the NY Depot. The raw material (biomass) would be aggregated and then shipped to Shi Farms' facility in Pueblo, Colorado, where it would be processed by the Shi Farms' other joint-venture partner, Mile High Labs.

Canbiola Chief Executive Officer Marco Alfonsi, commented, "This proposed joint venture is very exciting for Canbiola and its shareholders, as it would vertically integrate our positioning and capabilities in the now federally legal hemp market. Shi Farms, a trusted and top-rated CBD wholesaler, will provide technical expertise, availability of seeds and clones, and a cultivation license for the state of New York which Shi presently owns, which license will be used for multiple cultivation locations for the NY Depot. We believe this is a robust growth opportunity for Canbiola, and with Shi Farms as our partner, it would give us the scale and flexibility to increase our revenue in a profitable manner. We look forward to working with Shi Farms and launching this joint venture partnership by the end of July."

The LOI is non-binding and its terms are subject to the parties entering a binding definitive agreement memorializing the terms of the agreement. The parties expect to enter into the definitive agreements within thirty (30) days from the date of the LOI.   For more information on CANB, please visit:  https://canbiola.com/investors/ 

Other cannabis-related developments from around the markets include:

Marijuana Company of America, Inc. (OTCQB: MCOA) an innovative hemp and cannabis corporation, recently announced the signing of a Letter of Intent ("LOI") between Northern Lights Distribution LLC ("NLD") with Alpha Private Equity & Capital LLC ("Alpha") to form a joint venture ("JV") called Magnolia Extracts LLC ("Magnolia") pursuant to large-scale expansion operations to begin distribution, delivery and manufacturing of its cannabis products in the city of Lynwood, California.

Marijuana Company of America announced in April 2019 that the Company had officially acquired a 20% ownership interest and signed a joint venture agreement with Natural Plant Extract of California (NPE) to establish a premier cannabis delivery company called Viva Buds. NLD, a subsidiary of NPE, has entered into this partnership and will cover costs up to $1.5 million in phased expenditures, allocated to significantly build out a new production facility and utilize the 18,000 square foot building space to create greater efficiency and capacity for its operations.

PotNetwork Holdings, Inc. (OTCPK: POTN) recently announced that the Company's online store generated over $1.1 million in exclusive web-based sales in May 2019. Compared with May 2018, in which online sales totaled $569,671, May 2019's record online revenues represent a year-over-year increase of over 90%.

Diamond CBD's online sales reflect a continual impressive growth of the readership of its website. Recent analytics show that over 330,000 users visited the website in the last 7 days alone.

Medical Marijuana, Inc. (OTCPK: MJNA) the first-ever publicly traded cannabis company in the United States that launched the world's first-ever cannabis-derived nutraceutical products, brands and supply chain, announced recently that its subsidiary HempMeds® has added new products to its Personal Care Line of all-natural cannabidiol (CBD)-infused bath and beauty products. 

Research firm Jeffries estimates that the CBD beauty category could reach $25 billionglobally and will amass 15 percent of the total skin care market within the next decade. Future Market Insights stated in a recent report that the CBD skin care market alone is estimated to be valued at more than $645 million in 2019.

"We have a long history of being a pioneer in the CBD industry and want to continue to be recognized as a leader in industry trends with these new products," said HempMeds® President Todd Morrow. "These additions make the Personal Care Line all-encompassing and are designed to give people more power to make their own choices on how they will utilize CBD in their everyday lives."

Kona Gold Solutions, Inc. (OTCPK: KGKG) a hemp and CBD lifestyle brand focused on product development in the functional beverage sector, recently announced it has launched its highly anticipated Bubble Gum and Candy Apple flavored hemp energy drinks.  This announcement is coming off the success of Kona Gold's new Cotton Candy and Cherry Vanilla flavors that hit the market in late 2018, which continue to be the Company's top selling hemp energy drinks.  The Company anticipates its new Bubble Gum and Candy Apple flavors will be a huge hit with consumers and follows Kona Gold's formula of a healthy hemp energy drink that is zero calories, has zero sugar, all natural flavors, and organic hemp.  The new flavors are available immediately for purchase online and will hit distributor warehouses in the coming days.

Kona Gold has surpassed $20,000 in sales on Amazon in the past month.  With the addition of the new flavors recently added to the world's largest e-commerce website, the Company expects Amazon monthly sales to continue to rise.  Combined with sales from the Company's own e-commerce websites, online sales have hit a record high of over $38,000 in the past month.

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