Scaling Up Hemp Production to Meet Demand with Shaun Crew of Hemp Oil Canada

Shaun Crew

Shaun Crew, the founder and CEO of Hemp Oil Canada discusses large hemp cultivation in Canada. Discover all the products and food made from hemp, and how the demand for hemp is growing around the world.

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Key Takeaways:
[1:13] – What is Hemp Oil Canada
[1:53] – Shaun talks about his background in the hemp industry
[4:57] – The early days of Hemp Oil Canada
[6:25] – What is the prime growing period of hemp in Canada
[9:54] – The amount of hemp that Hemp Oil Canada produces annualy
[10:57] – Plans for future US facilities
[12:08] – The most popular products at Hemp Oil Canada
[13:20] – What is Finola
[14:52] – Sterilization of hemp seeds when arriving in the US from Canada
[16:08] – Shaun talks about hemp as a building material
[18:03] – Shaun talks about private labeling services offered by Hemp Oil Canada
[20:59] – Contact information for Hemp Oil Canada

Read Full Transcript

Matthew: Hi, I’m Matthew Kind. Every Monday and Wednesday look for a fresh new episode where I’ll take you behind the scenes and interview the insiders that are shaping the rapidly evolving cannabis industry. Learn more at www.cannainsider.com. That’s www.cannainsider.com. Are you looking for a fulfilling and lucrative career in the cannabis industry? Visit www.cannainsider.com/careers. That’s www.cannainsider.com/careers. Now here’s your program.

The public has fully awakened to the incredible promise of hemp and its myriad of applications as food, building material and many other uses. I’m pleased to welcome Shaun Crew, CEO of Hemp Oil Canada to CannaInsider today to help us understand where the hemp market is and where it’s going. Welcome Shaun.

Shaun: Good afternoon Matt.

Matthew: To give us a sense of geography can you tell us where you are today?

Shaun: Yes absolutely. We’re located in Ste. Agathe Manitoba, Canada which is about 25 miles south of the City of Winnipeg.

Matthew: Okay and what is Hemp Oil Canada?

Shaun: Hemp Oil Canada we’re a producer and processor of hemp food products and ingredients. We’ve been in business now since March of 1998, so just over 17 years. And we are producers and processors of hemp seed oil, hulled hemp seeds, toasted hemp seeds. There’s two grads of hemp protein powder that we manufacture, hemp flour a byproduct or coproduct we call a course hemp powder which is a fibrous powder. And we also produce a hemp coffee.

Matthew: Okay. You really picked a great industry to get into. What’s your background? How did you get started with hemp?

Shaun: Well that’s the interesting part. I’m an entrepreneur since I was knee-high to a grasshopper. So I was made aware of industrial hemp and particularly the legalization of it in Canada back in January of ’98, so about 3 months prior to it being releagalized here. I thought there was an opportunity there, and I saw kind of the planets aligned. We had farmers in Western Canada looking for new cash crops because there was the end of the what were called Crow Subsidies which allowed farmers in the middle of Canada to get their products to the ports on either side of the country at a reduced rate, and those ended making their product too expensive to try and ship to the port.

So they were looking at cash crops. We have, both levels of government are provincial and federal governments, both offering grant opportunities for rural development for Eggery [ph] food industry, for you know the development of rural agriculture in Canada and very supportive of the hemp industry during its infancy and even today but during its infancy. We had the number one laboratory for testing for THC, was located here. And we had numerous colleges, universities and food development centers all ready to assist in terms of product development and process development, and market development for this new industry.

So in my mind the planets were aligned and the opportunity presented itself to me, and I though well let’s go after this. I saw, you know, a great opportunity in that the consumer was beginning to flip around packages and notice that there was a nutrition facts table there, and they’re looking for nutrients and ingredients in the foods they’re eating that are more nutritious and more beneficial. And getting away from saturated fats and this type of thing. So looking for alternative protein sources and so on. And you take all these things together happening at the same time, and I just saw a great opportunity to get involved with something that was truly ground floor and trailblazing in the sense that nobody had done this in over 60 years, and any technology that was around 60 years was well-dated to the technology and the electronics and controls and monitoring that we have available today for food processing.

But I had absolutely no background in food processing and/or agriculture. So you know my background was in sales and marketing, and I saw an opportunity with the markets and for me everything starts with the market. And until you have that you don’t need machinery to process or buildings and desks and computers to operate. You need to make or create demand and have a sale before you do anything else. And so that’s where we were in about March of 1998 when we started the company. You know, great opportunity, and I decided I’d be one of the guys to go for it.

Matthew: So did you go out and raise capital back then? What were the first early days? What did it look like?

Shaun: Yeah exactly. I mean it was, you know, what’s commonly referred to as love. You know, it was mothers and brothers and best friends and whoever else I could entice with my smiling face and business cards. That’s basically how we got the company up and running. It was small, well relatively small, investments of $5,000 each that got the company going, and I mean we’re just talking a handful of people that I was able to raise that kind of money with. But then I was able to take the money that we raised and obtain a provincial government grant that gave me a loan guarantee, and I was able to go out and borrow money at a bank because the government was guaranteeing it. And in addition there were also, there was a grant program that was available for developing new processes.

So I was able to take the money we had and basically double it with a government grant. And that’s how we basically launched and got off the ground by buying our first oil press and some of the accessorial equipment that had to go along with that in the way of conveyance and seed cleaning and so on and so forth.

Matthew: Now what portion of the year, I mean I know there’s different environments temperature-wise in Canada as you move further north, but what part of the year actually is available for growing hemp in Canada.

Shaun: Well typically our growing season is about, you know we’re just a few weeks away from it here, about mid-May until about the middle of August up to September is sort of the growing season. Once we get into September in our part of Canada, and I’m referring to the western provinces of Manitoba, Saskatchewan and Alberta which is where we contract all of our hemp seed production. You know we can typically get until about the middle of September before we’re starting to see a frost. And once you see a frost that’s when all growth of the plants will die out, and they’ll dry down at that point.

Typically we’re harvesting when about 70 percent of the seed resists compression and so it’s kind of a window of opportunity. And you know we’ve got maybe a week to ten days to kind of harvest after you’ve reached that point, and hopefully get your crop off by then, but occasionally in the fall we’ll see rains and that kind of thing that can delay you. So if it happens that a farmer can wait until that first killing frost, either because of a later planting date or we get an early frost, you know, it does help dry down the plant and it doesn’t affect the seed at all if it hits the frost. And in fact it can help with harvest because it will dry down the fields.

Matthew: Now when you look at North America, can you summarize where you see it now in terms of both the challenges and opportunity for hemp and personally yourself as an entrepreneur what excites you about it?

Shaun: Well I mean I’ve been at this now 17 years, Matt, and I would still suggest that we’re only touching the tip of iceberg in terms of the potential demand for hemp food products and ingredients. You know 17 years ago there was no products out there. You go to just about any, certainly any grocery store or natural product or organic store or fine foods store in Canada and/or the US for that matter now, and you’re going to find something hemp in there whether it be one of the seed products or one of the oil products or a value added manufactured product like an ice cream or a cereal or a nutrition bar.

So the demand is increasing all the time. Consumers are certainly becoming more and more aware of hemp. You know a lot different today than it was 17 years ago when we would, you know, present hemp foods at a conference or a trade show and people often thought you know what are you even doing here. Is this even legal? Always that relationship with its cousin is what is the first thing people are thinking about when they see hemp foods and wondering if they’re going to get high from eating. Obviously we know now that that’s just all myth and mystery. And we’ve been able to proves there’s really no consumption of hemp food products that you would be able to intake and never build up enough of the THC metabolite in your blood stream to trigger a false positive. So using hemp in defense of a false or a positive drug screening test really isn’t possible to do, and anybody that’s tried to do it in the past has found that out I’m sure. So that’s the situation.

Matthew: Now to give us a sense of how much hemp you process a year, can you tell us how much is growing through your facility or how much you’re contracting for?

Shaun: Yeah, well we’re currently contracting about 25,000 acres a year. That’s producing oh about 20 million pounds say roughly of hemp seed that we would process in any given year. Now in 2013 and 2014 we were fortunate or unfortunate enough to have bumper crops. So consequently we’ve ended up with more seed supply than we were anticipating when we were seeding which is a good thing on one hand, and on the other hand, you know, it does allow us a little bit of wiggle room this year in terms of the number of acres that we’re having to contract. We’ve actually gone down a little bit because we want to be sure that we’re taking up the inventory of seed that’s already been produced and keeping everybody fresh that way.

Matthew: So as hemp becomes legal in the US, are you going to be adding facilities in the US at all or what’s your game plan there?

Shaun: Yeah exactly. We certainly have the intention at some future point to position a production facility somewhere in the US. We have reserved the trade name and registered the trade name Hemp Oil USA over ten years ago in anticipation that this would happen one day. So you know we’re planning to, no firm plans that way right now. Certainly we’re in the midst of a major expansion here at our facility at Ste. Agathe, Manitoba that will more than quite easily handle the demand and capacity needs for processing for a number of years to come out of this facility here. So you know on the other hand I recognize that it’s important to have a presence in America and I know how much you Americans like to buy American so I will definitely try to appease you in the long term.

Matthew: Okay, and now I know you convert the hemp into finished products. Which of those finished products seem to be the most popular at the moment?

Shaun: Oh absolutely, not at the moment, from day one until today and I could only imagine going forward is the shelled or hulled hemp seeds is by far the most popular product and it has been from the start and will be going into the future. And the reason for that is it’s just the most versatile of the products to utilize as food ingredient. And I mean as a product on its own the nutritional benefits are pretty much second to none in terms of 50 percent of the content of a hemp seed nut is the oil which is your Omega 3 and 6 fats. And there’s a good whack of protein and vitamins and minerals and dietary fiber is the balance. So it’s really a complete little food on its own. So, you know, it’s got a nice nutty flavor. It’s a soft little nut, easy to utilize as you would any other seed or nut in a food product. And so it’s from day one been the most popular and continues today to be so.

Matthew: What about Finola ? What’s that?

Shaun: Finola is a variety of industrial that we grow quite a bit of in Canada. In fact I think the last numbers I’d seen was somewhere in the region about 40 percent of the production of hemp in Canada is this variety Finola. It originates out of Finland. My good friend and colleague Dr. Jase Calloway is the breeder of record for Finola. And we were able to obtain the plant breeder rights on behalf of Dr. Calloway back in about 2005 for the variety, and since then we’ve been the plant breeder rights agent for the variety here in Canada and we’re also now supplying growers in the US with it.

So it’s a short, maturing variety. In other words the stature is about, I guess in terms of inches or feet, it would be about three and a half foot tall plant, but about three feet of that is typically a seed bud. So it’s one of the highest yielding varieties. It’s definitely the highest nutritional variety in terms of the nutritional content in the seeds. And it typically yields really well for the growers, particularly those that are under irrigation and/or those that are growing an organic regime. So it’s a super little variety to work with.

Matthew: Now is it true that some hemp seed when it comes from Canada to the United States is a requirement that it’s sterilized by US customs? I’ve heard some talk about that. I just want to know if you have more information.

Shaun: Yeah actually, it’s a little bit of a mixed message there. What the law is, and this goes for either side of the boarder Matt, that we as a processor cannot produce or distribute a viable seed product. In other words a seed product that you could take and plan in the ground that would grow into a plant. You know, it’s illegal for us to sell the viable seed to anyone else other than another licensed processor and/or a customer that’s authorized and permitted to import viable hemp seed.

And so that’s why we have to put it through a process of either sterilizing it or toasting it. Somehow we have to process it so that we can kill the germ on the seed and it won’t grow into a plant if somebody was to pop it into the ground. And that’s really what that’s all about.

Matthew: Now there’s a lot of people that reach out to CannaInsider talking about hemp as a building material, and there’s almost like a religious fervor about that there’s so much excitement around Hempcrete and some of these building applications. Do you see any of that?

Shaun: Yeah we do. Again our focus is on the seed and on the food, but obviously in this industry, you know, rather small even when you look on a worldwide basis, we’re certainly aware of the capabilities of not only Hempcrete, but other hemp based building material such as insulations and there’s fiber boards and moldings and all kinds of wonderful things that we’ve seen come out with hemp as the base product. In fact in our new facility that we’re in the midst of building across the highway from our current location, and we’ve incorporated a number of hemp building materials into the facility so that we can hemp it up is what we call it. Everything from drop ceiling panels to moldings and door trims to a hemp block wall in the reception area.

You know so different things that we’re trying to incorporate into our own facility, but you’re right there is a lot of excitement around hemp building products. And I think it’s a fantastic application to pursue. You know if you’re looking at the fibrous side of the plant because the opportunity to be producing the raw material for Hempcrete and/or for insulation are fantastic. And I think that’s an opportunity for some other entrepreneur to pursue, but we’re certainly excited about where that’s going. And at the end of the day it becomes a win/win. If we can now start buying fiber from our farmers as well and selling it as a raw material source to these companies looking at the building material side of the business.

Matthew: Now you offer private label services for other companies that don’t have the resources or processing facilities that you have. Can you tell us a little bit about that?

Shaun: Okay. Yeah that’s actually part of our business. In addition to supplying bulk wholesale hemp food products and ingredients, the other piece of our business is private label packaging all of those eight core products that we produce. So what that means is that we would package a product in a retail brand size of packaging labeled with our private label customers’ artwork and design. And so we’ll assist companies you know going through that process and help them to some degree with the labeling. We don’t want to get into the printing business ourselves, but we will help them with making sure the required elements are on a label whether it’s for Canada or the US. And then we can certainly offer them a variety of different types of packaging that they could consider. Everything from very eco packaging to more standard laminate type pouches and canisters and bottles and so on and so forth. It is a full service that we do offer our clients.

Matthew: Now is there anything looking out in the future that gets you really excited about hemp in terms of applications that are not quite ready for mainstream yet but you see the potential for?

Shaun: Well you know certainly the proliferation of foods products that we’ve seen come out, this is all good. I think the more hemp foods that you can get, you know, folks consuming on both sides of the border the better. I mean it’s certainly one of the most healthy food and food products that people could consume. So that’s certainly, you know, my number one goal is to see everybody with something hemp in their cupboards. In addition to that, and it’s particularly happening down a lot closer to you Matt, is the proliferation of interest an research and development around this whole idea of various cannabinoids that are found in both hemp and other cannabis species that you know there’s been a lot of interest in and a lot of health benefits and research surrounding.

So I’m certainly excited about those future opportunities. Right now it’s in a regulatory stalemate here in Canada, but I think in the US it’s been a little bit more of a free-for-all in terms of where you’ll find these cannabinoids and in what products and edibles and so on and so forth. But we’re keeping an eye on that, and we’re certainly watching the further development of other foods that again get some into everybody’s hands and everybody’s diet.

Matthew: Great. I just finished a hemp smoothie myself. So I’m a great advocate for hemp.

Shaun: Wonderful, good for you.

Matthew: So Shaun if listeners what to learn about Hemp Oil Canada, how can they do that?

Shaun: Well certainly you’re welcome to always visit our website at www.hempoilcan.com. And we spent a number of years rewriting our website to try to put it in more layman’s language, but at the same time giving people a lot of really good solid, fresh, technical information on hemp foods and the benefits of the ingredients and the nutrients that are found in the food products. So certainly welcome anybody to visit our website. You know if there’s a direct question that you need answers you can always email us as well at info@hempoilcan.com, and somebody from our customer care department will be happy to answer any questions that your listeners might have.

Matthew: Great. Well Shaun thanks so much for being on CannaInsider today. We really appreciate it.

Shaun: You’re very welcome, and thanks for inviting us along. Good Luck.

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