Hemp Farm Tour
Last month, I toured River Valley Hemp Co., a Minnesota hemp farm with Aaron Peterson as they began harvesting their first-year crop. It was a great opportunity to compare the outdoor grown hemp to my experience with indoor cannabis operations, of which I am more familiar. Due to the long growth cycle of outdoor hemp, the plants grow much larger, often taller than six feet, and they grow into nice rounded bush shapes as the sun hits them from all angles. Aaron and his farmers gave the plants plenty of room to grow as space is much cheaper than indoor operations and allows farmers to more easily tend the plants. We even dug-up the root system of one of the plants and it was huge! The overall grow strategy is much different for outdoor hemp grows as they are much more dependent on nature. Also on the tour was Jai Bowie, with GTM Ventures (a Minnesota Retailer) and Zach Robins, with Messerli Kramer (a hemp securities attorney). It’s not too often you get people from all aspects of the business together with professional services, so we had the opportunity to discuss everything from Minnesota’s new packaging rules and industry trends to retail and grow strategy and risks. I recommend touring a hemp farm to all who work in the hemp/CBD space.

Hemp Crop Losses and Testing
Recently in a Marijuana Business Daily article, Los Sueños Farms, one of the largest Colorado hemp farms, disclosed it lost about half of their smokeable flower crop to an early snow storm. The dependence on weather is only one of the major risks the farmers face. The risk is the crop testing hot (more than the .3% THC limit). This is an issue that was brought up at the Minnesota Hemp Association meeting earlier this month and this is a huge concern for our clients. The in-field tests are supposed to be random, but inherently, field agents are more likely to test from a large bud from the top of a large plant. This selection is far more likely to test hot, potentially leading to the destruction of an entire plot of plants. Often, when the product is trimmed and prepped for extraction, the material would be less than the .3% as it is encompassing more of the plant than just the best flowers at the top. Additionally, test results in Minnesota only show the THC contents of the plant, and do not report on any other cannabinoids, making it harder for farmers to compare state tests against third party tests. It was also noted that nearly 50% of the crops that test hot on the first run, pass on a secondary test, which has some of the local farmers questioning the testing methodologies.

CBD Cup
In October, I was a judge at the Legacy CBD Cup, which was held at Warehouse Winery in St. Lois Park, MN. This well-attended event was a great opportunity for local CBD companies to promote their brands and compete against some national brands. There were several categories for the companies to compete, including Best Flower, Concentrate, Vape, Tincture, Edible, Topical, and Most Innovative. As a judge, I received a bag filled with unlabeled color-coded CBD samples. I was given about two weeks to test each of the approximately 60 products before the event. Since it was an anonymous test, I had no idea of the products’ names or brands, nor their potency, etc.

The event was free and ‘open to the public’ and the competitors and other local CBD companies had booths and complimentary samples. The public also had an opportunity to vote on their favorite products for a lesser weight than the judges, which was great since it got everyone involved. I enjoyed speaking with the company representatives and had fun trying to figure-out the unmarked products that I had been testing. The event also had competitions for attendees to compete in challenges such as the best joint roller, biggest dab, and biggest bong rip – none of which I won. Legacy Glassworks also demonstrated live glass blowing and was making custom pipes for attendees.

I see the open use of hemp and CBD products as a good way of normalizing cannabis use. Even though is legal in several states, it still carries a certain taboo in relation to other recreational substances, like alcohol. I hope to see more CBD events like this pop-up across the country as the community around CBD and other cannabinoids continues to grow. If you’ve missed this event, be sure to attend next year!

Congratulations to the winners of the first Legacy CBD Cup event:

Best Flower: Cultivated
Best Concentrate: Minny Grown
Best Edible: Grounded Gardens
Best Tincture: Minny Grown
Best Topical: 5th Sun Gardens LLC
Best Cartridge: Crested River
Most Innovative: Crested River
Best Vape Device: Puffco Peak
Best MN Shop: Stigma Hemp

When selecting an accounting firm, nothing is more important than finding a Certified Public Accountant who understands your business and your industry’s unique challenges and opportunities. To learn more about Bridge West and the accounting, audit, tax, and advisory services that we provide to the hemp and CBD markets, reach out to Brandon Van Asten at bvanasten@bridgewestcpas.com.