Hemprise Bets on Federal Regulation of CBD with Construction of 100,000-Square-Foot Hemp Processing Facility

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Hemprise launched in 2019 with the purchase of 25 acres of land in southern Indiana that will eventually house what the company claims will be one of the largest hemp processing facilities in the U.S. with 100,000 square feet of processing space when completed. (Photo courtesy of Hemprise)

The company is completing phase I of the buildout, which consists of a 10,000-square-foot workshop on about half of the property located in Jeffersonville. Hemprise plans to launch phase II of construction when cannabidiol (CBD) is a federally regulated ingredient for food, beverages and dietary supplements, according to Zheng Yang, the company’s general manager.

“We are ready for the phase II construction project, depending on the situation of the CBD market,” Yang told Hemp Grower. “The leadership team from Lauyn, this company back in China, they think they’re going to build a facility here to take advantage of the promising future of the hemp CBD market in America.”

That promising future, Yang said, depends on the federal government clearing up the gray area surrounding the legality of CBD.

U.S. Rep. Trey Hollingsworth (R-D9) toured Hemprise’s facility last month and told local news outlet WDRB that “it's really exciting to see the integration of our great Hoosier farmers with [the] great Hoosier manufacturing mindset we've got here.”

A bill pending in the U.S. House of Representatives called H.R. 841 could be just what the Hemprise team is waiting for; the legislation, supported by Hollingsworth, would allow hemp-derived CBD to be legally marketed as a dietary supplement.

Hemprise is completing phase I of its buildout, which consists of a 10,000-square-foot workshop on about half of its 25-acre property located in Jeffersonville, Ind.

Hemprise plans to begin operations on trial run next year, when it will begin sourcing hemp from local farmers and producing CBD, which the company will sell wholesale to manufacturers.

Hemprise is currently working to establish contracts with hemp cultivators, but Yang said it has been challenging trying to work with many of Indiana’s small farmers on an individual basis.

“For a lot of small farmers, they’re working independently,” he said. “There aren’t any co-op organizations to organize all the farmers together. We are in a situation where we’re trying to work with the local farmer to see if there can be any cooperation because we are huge.”

When operating at full capacity, Yang said Hemprise would be able to process roughly 10 metric tons of biomass per day, which equates to approximately 8 million pounds of biomass per year.

The company currently has 15 employees and plans to hire up to 50 more when it launches commercial production next year. Once CBD is a federally regulated food, beverage and dietary supplement ingredient, Yang said Hemprise will become fully operational with plans to hire an additional 150-200 employees for the manufacturing facility.

Hemprise will hire locally, Yang said, with a focus on diversity.

“Once people are in our facility, we focus on equity and inclusion, so every employee has an equal opportunity to be trained, to learn a new skill and to grow with the company,” he said.

Part of the reason Hemprise chose its location in the Midwest is Indiana’s reputation as a strong agriculture state, Yang said, as well as its proximity to Kentucky, which he called the “capital of hemp.”

“Ohio, Indiana, Kentucky—they’re all traditionally manufacturing states, so we have much easier access to a skilled workforce,” Yang said.

While Hemprise will not formulate end products for the consumer, the company will have an R&D lab to create prototypes of products to showcase its CBD formulations for potential buyers.

“We have a firm belief that the CBD and other cannabinoids coming from nature definitely have huge potential in promoting health and wellness in human beings and animals,” Yang said. “We are waiting for the federal government to pass the legislation and make the CBD ingredient legal for the whole United States.”

In the meantime, Hemprise continues to focus on completing the construction of its CBD processing plant.

“It’s a very huge facility, so that is our short-term goal, to make it operational to produce high-quality and consistent product,” Yang said.

And in the longer term, the Hemprise team continues to wait for federal clarity on the legality of CBD as an ingredient in consumer products, a move that Yang said will kickstart the business in the U.S. and abroad.

“We’re waiting for the moment to come,” he said. “We’re waiting for the federal government to license the CBD consumer products in the United States. From there, we can really begin to operate and produce large quantities of the CBD ingredient to our customers and consumers. We’ll be prepared not only for the U.S., but we also see a big opportunity for the South American market, especially Brazil and Argentina. We’re also looking at opportunities in the European Union, as well. … We build our center around Jeffersonville, Ind., and then we’re going to continue to pursue the global market.”

Yang is hopeful that within the next six months, the federal government will take steps to regulate CBD. He said once it can be used as a food and beverage ingredient, Hemprise has its eye on future partnerships with large-scale beverage companies like Coca Cola and Pepsi.

“We’ve been building the facility for over two years because we are very patient,” Yang said. “We are continuing to invest in the manufacturing facility, we’re continuing to invest in working with the farmers and we’re continuing to invest in working with the local community, the local government and the lawmakers to really promote the whole industry. But again, we are patient. We are waiting for the moment."

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