The passing of the Farm Bill at the end of 2018 and the legalization of hemp has created an overwhelming demand for the hemp plant. Farmers are racing to plant hemp and the International Hemp Exchange is supplying Oregon farms with hemp seeds and saplings to help them get started immediately. Justin Jones speaks with Dan Humiston about the exploding hemp industry, and the opportunities and bottlenecks. Produced by PodCONX https://podconx.com/guests/justin-jones
The passing of the Farm Bill at the end of 2018 and the legalization of hemp has created an overwhelming demand for the hemp plant. Farmers are racing to plant hemp and the International Hemp Exchange is supplying Oregon farms with hemp seeds and saplings to help them get started immediately. Justin Jones speaks with Dan Humiston about the exploding hemp industry, and the opportunities and bottlenecks.
https://podconx.com/guests/justin-jones
Dan Humiston: [00:00:00] Welcome to Hemp Barons. On today's show an old friend stops by our Colorado mountain studio to talk him. I first met Justin Jones back in 2014 when I had him as a speaker at our first cannabis show in New York City. Justin spent in the cannabis industry for over 10 years. He had one of the first rec dispensaries in Colorado and he was an original partner in Kush bottles. And recently he made the transition to hemp in Oregon. Having been through the marijuana explosion Justin has some great insight into where the hemp opportunities lie. Let's join my conversation with Justin Jones from the international hemp exchange.
Dan Humiston: [00:00:52] Hey Justin.
Justin Jones: [00:00:53] Hey how you doing Dan.
Dan Humiston: [00:00:55] I'm doing great for our listeners. I would say you're probably one of my oldest friends in the cannabis industry and vice versa.
Justin Jones: [00:01:02] We've known each other for quite a few years now.
Dan Humiston: [00:01:04] Yeah and you were one of the first people on the cover of cannabis venture magazine. Remember when we had this magazine going to had you guys on the cover of that back when you were back in Denver.
Justin Jones: [00:01:14] Yeah. Yeah well that was would have been Kush bottles days. Was that your first marijuana show at the Javits Center. Second AMY Eric wasn't the first one. Yeah. We came out spoke at that and had some boots with crushed bottles and Denver CONSULTING GROUP I think also. That was great. You know you were one of the first guys to come out of the non marijuana world and say hey I can help these people out and I want to you know. And so many people were just like I can't I won't touch any of that part of the world with a 10 foot pole and you you brought your amazing skill set to bring people together and hosted a convention and all these things and really that was so crucial at that time and the industry needed it. And you know it's not so tangible all the time to know exactly how that those effects are but they're huge. And you know I can attest to that.
Dan Humiston: [00:02:03] I appreciate that even a tiny tiny bit of progress helped if we did anything appreciate you saying that.
Justin Jones: [00:02:10] Well you know and at the same time you know just. Just the connections that you make and I still have people that I first met at that first Javits Center convention. And just knowing you and you know and then you know when your daughter came out to Colorado and did a little internship with us at Denver Consulting Group and cash bottles and you know we wouldn't have been able to do that we wouldn't have known each other. All the things you know. So it's really all just spider webs out and gets better and better and bigger and everything else.
Dan Humiston: [00:02:37] So on that speaking spider webbing out now with this farm bill passing and now we're rolling into the next phase of this industry and that's hemp and this is what we're going to talk to you about today.
Justin Jones: [00:02:48] All right. This is exciting. It's really exciting. It really is. Yeah it really really is.
Dan Humiston: [00:02:53] I mean everyone I think most everyone in the country now knows a little bit about CBD and some people know a lot about CBD but I don't think anybody can appreciate the enormous demand. It's out of control right now. How much demand there is for CBD right.
Justin Jones: [00:03:07] I really agree with you there and you know the CBD has been going on for a while now and the states like Oregon and Colorado and there's a handful of other states that took the 2014 farm bill and took it a step further kind of like those states have with the marijuana variety of the cannabis plants. We did it with the hemp and instead of just having a research license they went ahead and went into full production. So Colorado or again you know have a big head start from the rest of the country because they've had two programs growing hemp for CBD. So you know this all started. Sanjay Gupta articles and the Charlotte's Web story and you know those people that were you know hope of these kids out what's the seizures and it's come a long way and expanded out as far as that goes. From what I've seen. But the big thing right now is that this plant the variety of cannabis is now legal coast to coast and all 50 states. You might not be able to do anything with it from a production or growing or these sorts of thing in those states but that they'll come around they have to go to legislature get caught up on matching up with the federal laws. In the meantime we are seeing rapidly expanding markets both in the demand on the consumer side and also farmers grow and help it grow and more and more farmers coming in.
Dan Humiston: [00:04:27] So and you talked about all the medical benefits that CBD but we're seeing this product in makeup in lotion in food. It's going into a lot of things right now. Most people right now think of it for medical purposes but I mean as we're seeing it it's going to start showing up in cosmetics it's going to start showing up in engage trade. It's going to start showing up a lot of places that you probably didn't think in every one of those different organizations are going to need a supply for sure and that sort of shy is right now a little bottleneck because you Yeah there's not a lot of lag.
Justin Jones: [00:05:02] Right. Right. The floodgates just got opened there wasn't some teared up. You know weather a little bit of a.. But I mean whatever was trickling out as far as a demand and then just the ability to do it because it's not legal that the floodgates got old everything's wide open because of this gigantic demand we go.
Dan Humiston: [00:05:20] This is where the international hemp exchange comes in. You are providing the seeds in some cases the saplings for the farmers to use in their fields so that they can see outgrowing these and maybe talk a little bit about this HGH seed that you guys are growing. Tell us a little bit about that and what makes that special.
Justin Jones: [00:05:39] Basically the international hemp exchange has acquired the rights to grow HGH seed in the state of Oregon exclusively used HGH. Seeds is now being. Produced in Oregon or again on a fourth generation Oregon farm. So it's a great partnership and the international exchange really made it all come together and couldn't ask for a better situation.
Dan Humiston: [00:06:03] Let's just talk about the business model in this greenhouse which you told me is it's like 24 acres worth the greenhouse here which is right you know. That's amazing. That's huge.
Justin Jones: [00:06:15] So in that facility though you're producing the seed and you're also growing the plant there to a point where you can pass it off to the farmer so that he can put it right into their field so that they don't have to worry about you know anything you can get them up and running on it.
Justin Jones: [00:06:31] Hemp production pretty quickly right as fast as they can put a deposit down on seed. You know at the end of the day last year Colorado had 600 total registered farms so already here six weeks into 2019 there are 2000 farms registered to grow hemp at Colorado. So so the 600 from last year most of those guys are doubling tripling going 10x. So we're creating these seed and then our partner farm here also has the ability to we can start the seed and grow it up the starter plant and deliver that to the field back to the farmers.
Dan Humiston: [00:07:07] I think when we were talking earlier you were saying that farmer can hope to make five hundred one thousand dollars an acre in profit with their normal crops. But would it help just tell the listeners.
Justin Jones: [00:07:21] Yeah I'm not saying this it's not going to be like the easiest thing to do. I'm not I don't want it to come across that way. But yeah you're right. Farmers make cheap about five hundred and two thousand dollars per acre and that's their problem with him right now. This year so far the prices and the numbers that we're seeing farmers are profiting north of one hundred thousand dollars per acre. This is this amazing stuff that's super super exciting. And you know I don't think that any farmer should run out and you pull all of his other plants out of the ground and go all in on him. That would be irresponsible. But I really do think that it's a chance in these farms to take a few acres maybe this year if they've never done it and do a test run. You know what I talked to a guy who did two acres. He got a check for four hundred eighty thousand dollars for the biomass on the two acres. You don't have to take a huge risk that you might have a nice windfall build a new building on your farm or upgrade your tractor or pay off a mortgage. You know all the things that the farmers have to do to continue to create generational properties and farms that they passed out on to the next generation.
Dan Humiston: [00:08:31] Well that's I think a lot of our listeners are investors and I don't think anyone really appreciates how much opportunity there is further down the supply chain like the farmer. So speaking of opportunity talk about some of the other places within this supply chain that are going to experience some big windfalls.
Justin Jones: [00:08:50] Yeah. I'm hyper focused on our seed sales and really working with the farmers. But I am seeing you know some of the broader side of the community and what's going on and you know I'm seeing investment opportunities on different types of extraction technology and extraction machines. So I heard of a somebody that's trying to build a pilot extractor that would actually go right to the farmer's field and while they're out there harvesting the plants they're literally shoving those plants all right off the field and into an extraction machine and they're getting CBD oil right out the other end. Wow. So that doesn't exist yet. I've seen the schematics and you know I know those guys are looking for money and it's when you see the numbers it's pretty impressive. You're looking at it an hour our eye on by a million dollar extractor that's weeks if not months. Well basically yes it's a fail up situation. And I think that there's a lot of good investment opportunities. And this thing is scalable. It's National lot sized numbers international size numbers everything. Yeah. Definitely in the processing and then also in the drying in order to make that oil most of the time they want dried materials.
Justin Jones: [00:10:02] So now these farmers are putting their crops down in the fall. All that material needs to get to a drying facility. So I was down at the Columbia held company just north of Corvallis Oregon. They took over an old lumber yard that had two big buildings and covered buildings on a lots of concrete and so you know that places got a bunch of different dryers different technology. They just got forklifts hauling around these try and tote bags of material so big that they're on forklifts you take them the wet material put them through to dry material and then at that point it can be sold off to an extraction company to be processed. So those are bulk processing companies and the hemp world and their handlers. But you know the drying of it and also the extraction part of it that's where the bottlenecks are. So. The investment is to I think you know that's where the data is.
Dan Humiston: [00:10:54] Like I said a lot of investors are listening to this show and HAMP is kind of new. Even though it's been around forever because of the passage of the farm bill there's a lot of attention on it and the opportunities here. We are just scratching the surface remember CBD is one byproduct of this. It's just one byproducts. There are so many that we haven't even talked about.
Dan Humiston: [00:11:17] Well it may save that for your show that's for sure sure. Yeah yeah.
Dan Humiston: [00:11:22] So we've been speaking with Justin Jones who's doing business development for an international hemp exchange and I'm going to have Justin's email in all of his information on his website along with anything about the international hemp exchange and there's farmers out there that are looking for some seed or some small plants to get ready for their next crop in Oregon. Justin talked to Sure. Justin it's been great talking to you and a great catching up but let's not make it so long next time. Let's keep in touch.
Justin Jones: [00:11:48] Yeah. I know for sure Dan I it really was great and I appreciate it and we'll talk to you soon.
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