Source 丨21 Healthnews21 original work
Author 丨 Wei laughs
Editor 丨Xu Xu
Picture 丨 Figure worm
Recently, the long-dormant industrial hemp sector has once again entered the upward channel, with leading concept stocks such as Rhine Bio, Shunhao shares, and Yongji shares leading the rise. Among them, on March 29, Rhein Bio opened again, recording 5 limit limits in the past 7 trading days.
The launch of the A-share industrial hemp sector may be due to the positive impact of the external market. According to public reports, the U.S. House of Representatives Rules Committee plans to hold a hearing on the "Cannabis Opportunity, Reinvestment and Decriminal Act" (MOREAct) on March 28 local time, and the vote will be held as soon as next week. The MORE Act was drafted by the Chairman of the U.S. House judiciary committee to remove marijuana from the U.S. federally controlled substance list, remove the criminal penalties associated with it, and promote social equity in the industry.
In this regard, on March 28, Rhein Bio insiders pointed out to the 21st Century Business Herald reporter that the "MORE Bill" is aimed at all kinds of cannabis, and even covers recreational marijuana, that is, drugs, with a wide range. However, at present, the relevant enterprises in the mainland are mainly involved in industrial hemp, industrial hemp refers to hemp with THC content of less than 0.3%, does not show psychoactivity, and its use is the most extensive, which can be used in textile, food, daily chemical, medicine and other fields. The expected impact of the bill on the industry as a whole and on companies is uncertain.
An industrial hemp-related business person also pointed out to the 21st Century Business Herald reporter that although it has not yet had a substantial impact, whether the bill can finally pass and land remains to be seen, but the bill has benefited the entire industry from the confidence level and the general direction of global industrial hemp development. If the bill can be passed smoothly, the lifting of the ban at the federal level in the United States is expected to set off a wave of cannabis legalization that has swept across the United States and even the world, and the downstream market imagination space is huge.
The United States fully liberalizes marijuana control?
In fact, the MORE Act is not a new bill, and it has been passed by the US House of Representatives as early as December 2020.
Industry analysts also believe that the bill has a high probability of passing the House of Representatives, and the House is currently dominated by Democrats (democrats have always been more supportive of marijuana legality, with a support rate of 83% in 2020), but it is difficult to say whether it can get support in the Senate.
At present, 37 states, 4 territories and the District of Columbia have legalized medical marijuana in the United States, of which 18 states, 2 territories and capitals have also legalized non-medical marijuana.
According to Canopy Growth' estimates, the global industrial hemp market size of more than 300 billion US dollars, in 2020 the US legal hemp market space of nearly 18 billion US dollars (the world's largest market), the year-on-year growth rate of at least 50%, is expected to maintain a compound growth rate of about 20% in the next 10 years, by 2030 the market space is expected to reach 100 billion US dollars.
Rhein Bio insiders pointed out to the 21st Century Business Herald reporter that the MORE Bill is aimed at all kinds of cannabis, and even covers recreational marijuana, that is, drugs, with a wide range, while Rhein Bio's main business is industrial hemp, which is only one of them.
It is understood that according to the different mass concentrations of tetrahydrocannabinol (THC) contained in cannabis, hemp can be divided into industrial hemp, intermediate hemp and recreational hemp. Industrial hemp refers to hemp with a THC content of less than 0.3%, which does not show psychoactivity and has a high fiber content; intermediate hemp has a THC content of between 0.3%-0.5%, which is less psychoactive and has medicinal value; while recreational marijuana has a THC content greater than 0.5%, has a tendency to be medicinal or abusive, and is prone to mental dependence on long-term consumption, so it is classified as a drug by most countries.
Among them, industrial hemp is the most widely used and can be applied to textile, food, daily chemical, medicine and other fields. In the textile field, industrial hemp fiber has natural bacteriostatic, cool and soft, shielded ultraviolet radiation, anti-static, heat resistance and other unique excellent characteristics, mainly used in the production of textiles, care products, medical equipment, etc.; in the food field, hemp seeds are rich in nutrients, rich in essential amino acids and fatty acids, can be used to make beverages, edible oil, food additives, etc.; in the field of daily chemicals, hemp seed oil as an emollient oil base oil, can be added to skin care products, the main ingredient of hemp leaf extract CBD has a better soothing, Moisturizing the skin, relieving pain, antibacterial and anti-inflammatory effects; in the field of medicine, cannabinol compounds extracted from cannabis flower leaves have a wide range of physiological and pharmacological effects in the human body.
Notably, in December 2018, the President of the United States signed the Agricultural Advancement Act of 2018, which removed cannabis with less than 0.3 percent THC from federal drug control and placed the crop under the supervision of the U.S. Department of Agriculture, which is responsible for developing a series of national regulations to replace interstate regulations regarding cannabis.
But at present, the mainland's attitude towards industrial hemp is still relatively cautious. On May 28, 2021, the State Food and Drug Administration issued the Announcement on Updating the Catalogue of Prohibited Raw Materials for Cosmetics (No. 74 [2021]), which explicitly listed cannabis (CANNABIS SATIVA) kernel fruit, hemp (CANNABIS SATIVA) seed oil, and hemp (CANNABIS SATIVA) leaf extract as prohibited raw materials. In addition, in the revised Catalogue of Prohibited Raw Materials for Cosmetics, cannabidiol is also banned.
Industrial hemp leaders recorded 5 stop-and-go boards in 7 trading days
Affected by the above good news, the domestic industrial hemp sector has recently been warmly welcomed by capital.
On March 29, Rhein Bio opened with another increase in the limit, recording 5 limit limits in the past 7 trading days, and the company expects that the MORE Act will have a positive impact on the company's industrial hemp business.
On March 21, Rhein Biotech disclosed the progress of the U.S. industrial hemp construction project: the project is expected to reach formal mass production by June 30, 2022; the company Sun Company Hemprise recently signed a fiduciary processing intention agreement with A Company A, a provider of industrial hemp products in the United States, and Company A plans to entrust Hemprise to process 500,000 pounds (about 227 tons) of industrial hemp raw materials from August to December this year, and the initial estimated processing fee will exceed 2.55 million US dollars. The maximum will not exceed $5.7 million. Affected by the announcement, the company's stock price rose in the afternoon.
According to the annual report, Rhein Biotech and its subsidiaries are mainly engaged in the production and operation of natural health products, the main products are monk fruit extract, stevia extract, industrial hemp and other natural plant extract products and natural Chinese herbal extract products.
In October 2021, it pointed out on the investor platform that the output products of the company's industrial hemp project are mainly PRODUCTS containing CBD (such as medical CBD, full-spectrum oil, broad-spectrum oil, etc.) and CBG, CBN, etc. The company adopts the production method of sales and production, that is, according to customer customization or market demand (such as specifying CBD content requirements) to carry out CBD product production, so for different orders or products, the production of CBD-containing products that can be extracted from one ton of industrial hemp raw materials is different.
However, Rhein bio-related people also told reporters that the impact of the above bill on the entire industry and the company is uncertain. "In fact, we are mainly responsible for CBD extraction, just a company in the industry, and the impact on the company's performance mainly depends on downstream demand." We are currently preparing for mass production. Because there is no liberalization in China, our entire industrial hemp extraction and downstream sales are oriented overseas. ”
Shunhao shares also focus on the layout of the industrial hemp industry. A few days ago, it pointed out on the investor platform that the layout of the industrial hemp industry is an important strategic decision made by the company based on the global industrial development trend. The company continues to be optimistic about the development prospects of the biological health industry, actively pays attention to the opportunities of the global industrial hemp market, and pays attention to the application and development of cannabidiol (CBD) in the fields of medicine, pain management, mental health, and health care products. At present, Yunnan Luxin Biopharmaceutical Co., Ltd., a wholly-owned subsidiary of the company, has obtained an industrial hemp cultivation license and processing license.
Recently, E1011LABS, a wholly-owned sun company located in the United States, signed a letter of intent for cooperation in the production of industrial hemp heating non-combustible appliances and heating rods with TAATGlobalAlternativesInc., a leading Canadian industrial hemp cigarette company, to jointly expand the international market share of the two parties in the field of products. It is reported that the two sides will jointly develop a heating non-combustible appliance and three proprietary flavor heating rods under the brand name of TAAT, which are tobacco and nicotine-free.
It is worth noting that Longjin Pharmaceutical, one of the leaders in the last round of market, was relatively cautious in its institutional survey in March 2022, saying that at present, industrial hemp extracts in the province are mainly used for export, and domestic application scenarios are limited, so the production enthusiasm of enterprises is not high.
Among the A shares, fuan pharmaceutical (300194) U.S. hemp project has begun operations, with a planting area of about 120,000 square feet, and the holding subsidiary RedRealtyLLC industrial hemp plant and workshop have been basically completed. Rhein Biotech (002166) is building the "Industrial Hemp Extraction and Application Engineering Construction Project" in the United States, which will reach official mass production by June 30, 2022, making it the world's largest industrial hemp extraction plant.
The above-mentioned industrial hemp-related enterprises also pointed out to the 21st Century Business Herald reporter that the domestic CBD extraction technology level is at the world's leading level, and the industrial hemp raw materials produced by domestic enterprises are mainly used for export. The size of this market mainly depends on the downstream demand space, with the promotion of more countries' relevant policies, the improvement of consumer acceptance, and the continuous expansion and deepening of downstream applications, the development prospects of the industry are broad.