The departure of Canopy Growth’s founder, Bruce Linton, earlier this month seems to have had no effect on the company’s expansion plans from Canada to the United States. Canopy, one of the world’s largest cannabis companies, is still planning to plant hemp roots in upstate New York.
At least according to its president, Canopy Growth will move forward on Linton’s vision and on its brand new hemp industrial park, which opened on Monday in Broome County, New York. Rade Kovacevic, Canopy’s president, told Cannabis Wire at a ceremony marking the opening: “At Canopy, we don’t slow down for a second. We’re moving full steam ahead.”
New York State Assemblymember Donna Lupardo, who was instrumental in passing New York’s hemp legalization bill in 2014, and US Senator Chuck Schumer of New York, both spoke at the industrial park event, stressing the expected economic boost to the Southern Tier of New York from Canopy Growth’s investment. The investment is particularly significant for the region, which has long struggled to improve its ailing economy.
“Today is a turning point day for the Southern Tier,” Schumer said. “Not only are we celebrating a job-creating, economy-jolting investment in Broome County, but we’re celebrating the commencement of work on New York’s very first hemp industrial park.
“The Southern Tier is well on its way to becoming the Silicon valley of industrial hemp,” Schumer said.
Lupardo said that Canopy’s industrial hemp park is “not just about revitalizing agriculture,” but also about “reclaiming our place as innovators and manufacturers. That’s what this project means for so many of us.”
By chance, Canopy Growth broke ground on its hemp industrial park as Governor Andrew Cuomo signed a bill to decriminalize cannabis in New York on Monday. The bill decriminalizes possession of small amounts of adult-use cannabis, imposing a fine instead of prison time, and establishes procedures to expunge both past and future records for low-level possession charges as well.
Lupardo believes that the decriminalization bill is “a step” toward legalizing cannabis in 2020. “The fact that we have decriminalized to this extent and will allow the expungement of thousands of records is certainly a positive development,” Lupardo told Cannabis Wire.
Lupardo also acknowledged that she was initially concerned for the progress of Canopy Growth’s hemp industrial park when Linton was fired from the company. “I honestly wasn’t sure what was happening with that,” Lupardo told Cannabis Wire. “But I’m happy to see that they’re moving forward strongly. I tried to stay positive through waiting to see what they were going to do.”
Lupardo said she did expect “shuffling” to happen in large corporations like Canopy, particularly after Constellation Brands invested $4 billion in Canopy Growth in late 2018 in exchange for four of the seven seats on the company’s board. She said she assumed that Canopy Growth would have to be “in alignment” with Constellation Brands’ mission.
News of Linton’s departure came a few days after Constellation Brands’ CEO Bill Newlands voiced his disappointment in Canopy Growth’s latest earnings in June. Kovacevic praised Constellation Brands for its investment and maintained that the hemp industrial park, and Canopy Growth’s expansion in the United States, would not be possible without it.
As to what’s next for the hemp industry in the state, Lupardo said that her main focus is on regulating hemp extracts, particularly CBD. “We want to put in place the most protective regulatory standards for the labeling of CBD products,” Lupardo told Cannabis Wire, adding that she is concerned about out-of-state and foreign imports of CBD products into New York which do not come with any information on “where they are grown or how they are processed.”
A key requirement of her bill to regulate hemp extracts is a QR code on CBD products that will reveal such details. “We want to make sure that New York’s products have the highest standards, and other states will have to meet those standards,” Lupardo said.
Lupardo gave no indication of when she expects the governor to sign the hemp extracts bill. “I know that they’re going to be reviewing the bill in detail,” she said.
New York state’s bill to regulate hemp extracts, introduced by Lupardo and New York State Senator Jennifer Metzger, was passed on the last day of the legislative session in June, following a failed attempt to legalize adult-use cannabis. Lupardo said that the CBD industry is supportive of the bill “for the most part.”
However, she said, the industry wants to make sure that while legislators favor New York hemp farmers and processors, they do not “prohibit them from bringing out-of-state” hemp materials and goods, which could be a problem if there’s a shortage of hemp supply, Lupardo said.
Kovacevic expressed Canopy Growth’s support for Lupardo and Metzger’s bill. “Our belief is that hemp products and CBD products need to be regulated,” Kovacevic told Cannabis Wire. “I think the success we’ve seen in Canada is that having stringent regulations give consumers confidence in what they’re buying.”
Canopy Growth is largely focused on processing hemp for CBD at its New York facilities, said Kovacevic. But he hopes that other companies dealing in hemp textiles and automotive products, for example—will set up in the area and use the byproducts, like hemp stalk, from Canopy Growth’s operations to create new products. Kovacevic also said that should the federal ban on cannabis end, Canopy is “always open to talking” about expanding into the adult-use market in the United States.
The company announced the location for its 308,000 square-foot hemp processing facilities in Broome County, New York in April. As Cannabis Wire reported in May, some small cannabis businesses in the state are worried that Canopy Growth’s entry into New York state will bring new competition and the possible oversupply of CBD, driving down prices.
However, Lupardo cited Linton’s comments in an interview with Cannabis Wire back in May—that the company hopes to “create an ecosystem that inspires new entrepreneurs and generates more economic stimulus than a single company can offer”—as an encouraging sign.
“They see themselves as a partner. And they’re coming into our state not asking for economic stimulus money, they’re not asking for incentives,” she said. “We fully expect to support all size businesses, including small farm businesses.”
Source: CannabisWire.com
