HEMP INNOVATION 2015 - Canadian Hemp Trade Alliance

Report
LONG-TERM
INTERNATIONAL
STRATEGY (LTIS)
Prepared by Russ Crawford and Markus Schmulgen
 It is the goal of the industry to grow 40,000
hectares (100,000 acres) of hemp in
Canada by 2015. Given average yields and
current prices, this represents over $35
million in farm gate receipts which
translates into over $100 million for the
Canadian economy. The various goals of the
LTIS will support…
---Hemp 2015-$100 million---
1. Background
2. SWOT
3. Branding
4. Strategy
5. Strategy Formulation
6. Strategy Implementation
7. Measurement
 National Industrial Hemp Strategy
 Evolution of CHTA and Board
 Executive Director & Board
 Membership – producers, companies, etc.
 Funding – Industry, government
 Industry Standards - By-laws, Code of Conduct
 Support from AAFC & CAAP
 LTIS Review
Promotion and
Communications
Research
Market Development
Administration
Current state of the hemp industry in Canada
 Expanding acres in Canada
 Controlled and monitored by Health Canada
 Remains illegal to grow in USA
 International market focus on fibre
 More hemp SKU’s in N. America
 Economics still show hemp is highly profitable
 Environmentally friendly & non GMO
Yukon
60,000
50,000
40,000
PEI
NS
NB
30,000
20,000
10,000
0
Quebec
Ontario
YEAR
20
08
20
06
20
04
20
02
Man.
20
00
19
98
Acres
Hemp Production in Canada
Sask.
Alberta
BC
Canadian Hemp Product Exports
$12,000,000
$10,000,000
$8,000,000
Hemp Oilcake
$6,000,000
Hemp Fiber
$4,000,000
Hemp Oil
$2,000,000
Hemp Seed
$0
2006
2007
2008
YEAR
2009
2010 Proj.
Ambitious Goals?...........Not Really…………..
Economic
Benefit
Acres
80,000,000
$200,000,000,000
70,000,000
$180,000,000,000
60,000,000
$160,000,000,000
$140,000,000,000
50,000,000
$120,000,000,000
40,000,000
acres
$100,000,000,000
$80,000,000,000
30,000,000
$60,000,000,000
$40,000,000,000
20,000,000
$20,000,000,000
10,000,000
$-
hemp
canola
soybeans
eco benefit
Themes from ANUGA 2011
LOHAS – lifestyles of health and sustainability.
Convenient, gluten & allergen free.
People spending more to regain health.
People taking responsibility.
Organic consumption growth rate is 20%/yr.
Awareness of challenges with GMO.
Animal products tainted – mad cow, radiation,
meds, hormones, poor land use, subsidies.
 Evolution to vegetarian and vegan diets.

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 WHAT
 100,000 acres
 $100 million
 WHEN
 By 2015
 HOW
 Communication
 Research
 Market Development
 Administration
 Specific Action Plans
 Create and execute a brand and
communications strategy.
 Research health benefits and feed
applications.
 Secure GRAS status for hemp powder and
oil.
 Operate a full time industry association
office.
 Promotion and Communications
Develop and implement a two-year
branding and communications
strategy for hemp and hemp products
targeted at export destinations.
 Research - Conduct research on
health benefits and feed
applications for hemp products
achieving results from at least one
study each year for the next two
years for a total cost of $1,000,000
over the full time period.
 Market Development - Secure
GRAS status for hemp protein
powder and hemp oil over the next
two years at an annual cost of
$1,000,000 per year. ($2,000,000 in
total).
 Administration - Operate a full time
CHTA executive office out of
Winnipeg with an Executive Director
and communications employee
responsible for day-to-day operations
and market development execution
at a cost of $100,000 per year.
Objectives that will benefit the whole industry…
1. To undertake the research necessary to
promote and obtain regulatory approval for
hemp as a healthy ingredient.
2. To facilitate the effective use of generic market
development and promotion programs by
CHTA members that are targeted and geared
towards developing new opportunities.
3. To expand/find new uses or dual usage for
hemp (seed, for food and cosmetics, and fibre)
 Effects of Hemp in Poultry Rations.
 Effects of Hemp Protein and BioActive
Peptides on Hypertension and Kidney and
Heart Health.
 The Safetiness and Bio Availability of a Long
Term Consumption of Hemp Oil in Vivo.
 Hemp Decortication and Use of
Decortication By-Products for Biofuel
Production and Green Building.
1. Background
2. SWOT
3. Branding
4. Strategy
5. Strategy Formulation
6. Strategy Implementation
7. Measurement
• Producer of high quality hemp seed and fibre.
• Focused, capable dedicated group of members of
CHTA.
• Development of a prioritization
of projects based on industry
demand and growth signals.
• Body of knowledge with respect
to breeding, processing and
product development.
• Name recognition – Hemp – Canada. (More for
food than fibre).
• Established relationships with retailers and end
user clients – product awareness.
• Many Canadian co-operative ventures assuring ongoing participation from vested stakeholders along
the supply chain.
• Engaged government supportive in
developing the crop sector.
• The need to achieve Generally Recognized As Safe
(GRAS) status with the US Food & Drug
Administration for hempseed and hemp products.
• Lack of approval from the Canadian Food Inspection
Agency (CFIA) for the use of hemp and hemp products
in animal feed.
• Lack of clinical research specifically on
the health benefits of hemp seed and oil.
• Absence of funds to proceed with critical clinical trials
and hemp product efficacy.
• Government’s 50/50 matching strategy poses
significant problems in qualifying for any funding
programs.
• Small producer and processor base
unable to source adequate
funding to conduct necessary
research.
• Absence of hemp fibre processing
facilities in Canada.
• Consumer demand is trending more towards local,
natural, organic, eco-friendly products playing right into
the primary attributes of hemp food and fibre products.
o Human foods
o Pet foods
o Body care products
o Health industry
o Building products
• Build on the positive environmental
impact of hemp in the
agricultural sector as a minimal user of chemicals producing a
non-GMO product.
• Work with government financial support and
people resources to develop new products and
identify and capture new markets.
• Continue the work on clinical trials, feeding trials
and varietal development building on our existing
experiential knowledge and expertise.
• Work together as an industry for the strategic
advantage of the Canadian hemp trade.
• Inability of the CHTA to sustain operations due to
inadequate funding. This would result in the loss
of a focal point and primary contact for programs
and direction.
• Concentration of dedicated industry participants
may exhaust the energy and commitment of those
people.
• USA legislation approving the cultivation of hemp
(this may be seen as an opportunity, as it
potentially accelerates the development process
and research requirements with new investors, but
it has the potential to marginalize the Canadian
hemp industry).
• Potential for either demand or supply to outpace
the other creating a market failure.
• Shortage of available, affordable sample testing
laboratories.
1. Background
2. SWOT
3. Branding
4. Strategy
5. Strategy Formulation
6. Strategy Implementation
7. Measurement
 Brand Hemp as “Canadian” Quality
 Leverage our production experience
and ideal agronomic conditions.
 Establish and build on the idea that
Canadian hemp is superior to hemp
grown elsewhere in the world.
 Product recognition and brand identity.
1. Background
2. SWOT
3. Branding
4. Strategy
5. Strategy Formulation
6. Strategy Implementation
7. Measurement
 Positioning the industry relative to
competition that is well established.
 Developing a shared vision.
 Uniting stakeholders to work
together.
 The hemp industry is at a critical
“Grow or Die” stage.
 Know Yourself
 Research
 Clinical trials
 Know Your Customer
 Nutritional benefits
 Education
 Discover factual attributes of the
properties, characteristics and functional
value of the hemp plant in order to make
substantiated claims.
 Seek out the needs and preferences
consumers are looking for in food and fibre
products.
 Communicate, in an effective manner, how
well hemp can satisfy these specified needs.
Processed Canadian hemp products, in one form or
another, have found their way to 30 different
countries around the world over the past four years.
1. Background
2. SWOT
3. Branding
4. Strategy
5. Strategy Formulation
6. Strategy Implementation
7. Measurement
 Promotion and Communication
 Two year branding and communication
 Research
 Two year $2,000,000
 Market Development
 GRAS - $2,000,000
 Administration
 $100,000 Annually
 Completion of Marketing Materials
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Hemp 101 Overview
Trade Show Booth
Trade Show Banners
Social Media Campaign
 Important Events
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Hemp History Week
Natural Products Expo East, USA
Natural Products Expo West, USA
American Dietetic Association, USA
Green Festival-San Fran, NYC, LA
EIHA-May 2011
Culinary Institute of America, USA
Canadian Health Food Association Trade Show, Canada
Natural and Organic Product Expo Europe 3, Great Britain
BioFach, Germany
ANUGA, Germany
 Failure to maintain an industry
association to lead the initiatives
identified through:
 Inadequate funding.
 Lack of industry support and co-operation.
 Reduction in the profitability of growing
and/or processing hemp for food and fibre
applications vs. competing crops.
 Public and governmental stigma towards
hemp.
 Cost of Production
 dual purpose crop
 agronomic research
 Product Innovation
 Infancy Industry stage…niche market
 Stigma of hemp/marijuana “Refer Madness”
growing acceptance with education - 14
years in the making.
 Illegal to grow in USA, DEA lost in court
2003-4, border is open, many states passed
to grow.
 Hemp milk & ice cream on Dr Oz April 2011.
 Soy, corn & rice functional food
competition.
 Execute LTIS Strategy.
 Secure funding to support research,
communication strategies and ongoing administrative support.
 Embolden and entrench CHTA as
unifying voice for the Canadian hemp
industry.
 Build
North American/
European
Collaborative
Ventures.
 Eradicate Stigma.

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