The Hemp Industry is Here to Stay

by Jesse HahnNatural Fibre Technologies

Two important things happened to the hemp industry in 1998. First, Hemp cultivation was legalized in Canada, as mentioned in part one of this series of articles. Second and simultaneously, was the creation of TTS Fibre Products Laboratory – a credit to Tam Tekle, veteran of Alberta’s forest processing industry.  He decided to cast out on his own as an entrepreneur with a mission to put some substance behind the hemp “the miracle plant” rhetoric.

His first decade in operation consisted of developing and prototyping fibre products using hemp, flax, municipal fibre waste and forestry waste. In 2008, TTS stepped it up by purchasing pilot scale equipment to produce limited commercial quantities of some of the platform products they had created, namely Engineered Fibre Mat, Fibre Reinforced Cement and Bio-Fibre Composite Panels. In 2013 TTS successfully commissioned its first commercial spin-off and dubbed the BioComposites Group, which consists of the first and largest (and I think still the only) engineered fibre mat facility in Canada.

While TTS’s progress significantly helped the hemp industry gain traction it hadn’t solved the #1 bottleneck to the industry’s development. What was needed was a solution for Decortication – the primary breakdown of hemp stalk into its two main useful components, Hurd and Fibre. In 2011, the Alberta government commissioned a roughly $5M, 13,000 sq/ft, 1-ton per hour decortication research facility in Vegreville. The GOA deserves recognition and credit for having the foresight to support this industry early. But at 1-ton/hr. decorticator is still only enough for R&D purposes.

To date it’s been thought that Hemp processing requires multi-million dollar equipment. The price for decortication facilities range from $1.8M to $20M for 1-ton/hr. to 10-ton/hr capacities. These price tags have been keeping the industry in a chicken vs. egg situation. Chicken: the need for large purchase orders to justify such a large capital expenditure; Egg: a purchase order is not feasible without a secure supply of high quality processed material, that hemp can’t provide if it’s illegal to grow. Entrepreneurs have recognized this pain, and in anticipation of an oversupply of hemp stalks, a few have come out of the woodwork to address this opportunity. Here’s a quick look:

Sunstrand has moved some equipment to Alberta from Kentucky. It was only a matter of time before our American Hero’s moved in on this opportunity. It’s rumoured their facility will process approximately 1-2 tons/hr.

Hempco and NFT are almost finished refurbishing a long-awaited processing line that should pump-out 2-3 tons/hr hour of material. You can find details of the costs of the facility on Hempco’s SEDAR profile. Final costs are not yet tallied but it will be less than Innotech’s $5M facility and more than CGT’s $1.8M facility (below).

Canadian Greenfield Technologies (CGT) has developed their ‘Hemp Train’ decortication system. With an output of 1-ton/hr. and a price tag of $1.8 million, they are taking orders. Two stories and a footprint of less than 550 sq/ft.

There are a few others some in the US others in China, but they don’t compare.

I want to leave you with one that has been call a ‘game changer’. Natural Fibre Technologies (NFT) has conceptualized and successfully piloted a 1-ton/hr and mobile. The modular decortication technology produces cleaner hurd and fibre without having to further refine either before value-added product processing. The footprint is less than 150 sqft. The pilot unit’s cost is a fraction of the cost of any other processor and the quality of the fibre produced is superior to any other known processor on the market in Canada. The version 2.0 commercial unit promises to process 2-tons per hour with a very competitive manufacturing cost. NFT has a strategic vision to  commercialize this decortication technology and providing the missing link in the hemp value chain.

NFT’s decorticator is part of a larger initiative dubbed the “Local Decortication Program” which hopes to bring farmers into the processing value chain by reducing costs of processing the stalks right at the farm gate and paying them more for the processed material than the large centralized facilities can economically justify. The project was catalyzed a year and a half early by a Hemp Industry Champion, Joe Gulayets, financed by a visionary farmer, Darren Haarsma who owns Natty Sask Farms and says this: “Creating a mobile decorticator not only enables farmers to produce more value from their(our) crop, but it also enables a wide range of end products to be cost effectively produced, which will accelerate the evolution of the hemp industry.”

The Hemp industry is here to stay. Farmers are in dire need of a new crop for their rotations when battling clubroot. Hemp seed is a superfood that offers an alternative to sourcing omega fatty acids from aqua-cultured fish. The flower can be a source of revenue for medicinal compounds. And now the other 90% of the biomass can be harvested, processed and sold as a source of material that will substitute other products with larger carbon footprints. Indeed this plant provides too many social, economic and environmental benefits to ignore. The challenge now is: how to support a sustainable hemp industry while employing the concept of whole crop utilization?