Queensland Bauxite has 60 tonnes of hemp seed – and another 500 on the way
Hemp-seed food production is underway at Queensland Bauxite’s Vitahemp subsidiary, with 60 tonnes of the seed in storage and another 500 tonnes on the way.
Queensland Bauxite (ASX:QBL) calls Vitahemp Australia’s largest hemp seed producer and shareholders seem to agree, pushing the shares up 12 per cent after the news.
The shares were trading at 7.8c at lunchtime Thursday, valuing the company at $118 million.
The task now is to turn the seed into consumer products ahead of Vitahemp’s commercial product launch in January.
Vitahemp’s parent company Medical Cannabis — which is 55 per cent owned by Queensland Bauxite — will ship 20 tonnes to partner Waltanna Farms for oil, protein and flour production. A further 10 tonnes will be processed by production company Hemp Hulling Co.
Hemp seed food products were made legal for human consumption in November, and there’s been a rush for companies like Vitahemp to get into the market — though demand is largely unmeasured.
Vitahemp is hedging its bets, planting a further 20 tonnes of seeds with an anticipated yield of 500 tonnes of seed to ramp up bulk production in March 2018.
“A further larger Autumn crop is being planned to enable the continuation of supply to meet the enormous demand Medical Cannabis and Vitahemp have been receiving,” shareholders were told.
“Vitahemp is now well-placed to be the first-mover and leader in the Australian hemp seed food industry.”
If company founder Andrew Kavasilas has his way, Australians will be consuming the seed in everything from hemp milk on breakfast cereal to salad dressings and lollies.
“In the same way that you have hundreds of researchers trying to discover the perfect grain of wheat, so too will we have the same development in hemp,” he told Stockhead in September.
“Products like hemp seed milk already sit in supermarket shelves overseas, we are just the last western company to legalise it.”
The company was given quarantine clearance for a seed shipment of 20 tonnes earlier this week, giving them an advantage over their competitors using foreign seeds.
“Hemp food seeds from any country other than Australia now require rigorous processing such as being denatured and irradiated for safety and health reasons,” Vitahemp said.
“Much of the potency of the seed is lost as a result which is not the case with hemp food seed extracted from hemp grown in Australia.”
Shareholders were told cashflow was on its way, the company “well placed” for anticipated dividends.