Two Canadian cannabis companies said this week that their strategy for expansion into the U.S. market includes – and will start with – hemp and CBD.
Canopy Growth, a Smiths Falls, Ontario-based leader in the Canadian marijuana industry, said Tuesday it will open hemp processing facilities in seven U.S. states within the next year.
Earlier this year, the company announced plans to enter the U.S. cannabis market, starting with construction of a $150 million industrial park in Kirkwood, New York, for hemp-derived CBD extraction and processing.
Canopy also made a complex deal with New York-based marijuana firm Acreage Holdings in which it will acquire Acreage if cannabis is federally legalized in the United States.
Until that happens, hemp and CBD extraction and processing centers will be the extent of Canopy’s U.S. deals, Canopy CEO Bruce Linton told Bloomberg.
Canopy Growth trades on the New York Stock Exchange as CGC.
Meanwhile, Cronos Group also has its sights set on the nascent hemp industry in the United States.
The Toronto-based company is likely to launch CBD products by the end of the year, CEO Mike Gorenstein said.
A landmark $1.8 billion investment by North American tobacco giant Altria Group, along with Cronos’ ties to cannabis private equity firm Gotham Green Partners, might be Cronos’ pathway to securing a foothold in the U.S., Gorenstein said.
“Through the Altria partnership, we do have access to over 200,000 retail stores across the U.S. .… access to networks of farmers that can convert from growing tobacco to growing hemp,” Gorenstein told online news network Cheddar.
“It’s really about having the right product and then rolling it out across.”