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Hempseed company scouts future markets

Posted on November 9, 2000

Saskatoon, Saskatchewan — In a province plagued by brain drain, it’s refreshing to receive a little injection of grey matter.

Saskatchewan’s brain gain is courtesy of Jason Freeman, a young entrepreneur from Vancouver who recently moved his hemp business to Regina.

The Saskatchewan Hemp Association, the provincial Agri-Food Equity Fund and a hempseed supplier called Gen-X Research Inc. influenced Freeman’s decision to relocate.

“There’s not much hemp being grown in east Vancouver,” said the president of Biohemp Technologies Ltd.

This June, his company launched its Mum’s Original line of edible hemp products.

“We decided on a niche that a small company that is undercapitalized could pretty well protect, which was certified organic hempseed products.”

Hemp seed oil is the flagship product, but the company also sells hemp flour, dehulled hempseed and a variety of toasted hempseed snacks, which Freeman said are selling well.

The Mum’s Original line is available at 120 health food stores across Canada and the company is starting to make inroads in the United States.

A $15,000 grant from the Saskatchewan Agri-Food Equity Fund enabled the company to hire four sales representatives to conduct in-store demonstrations in several regions of British Columbia, Alberta and Toronto.

“That was really crucial for us,” he said.

Including the $15,000 grant, Freeman and his business partner, Martine Carlina, raised $150,000 to establish Biohemp.

Most of the money came from friends and family, but they were also able to raise $41,000 through Vancouver stockbrokers.

Freeman got his start in the hemp business when he opened a retail hemp store in New Westminster, B.C., in 1995.

He moved on to become director of sales for Wiseman Noble Sales and Marketing, a Vancouver-based company that lobbied hard for the legalization of commercial and industrial hemp production.

He organized hemp symposiums and trade shows and sold advertising for Commercial Hemp magazine.

The company folded shortly after Health Canada legalized the growing of industrial hemp in March 1998.

“It’s mission was fulfilled and I had all this great market information.”

Capitalizing on his knowledge and industry contacts, he created Biohemp in May 1999 and moved the company to Regina a year later.

Welcome addition

Kelley Fitzpatrick, president of the Saskatchewan Nutraceutical Network, said Freeman and his partner bring youth and enthusiasm to the province’s fledgling nutraceutical and dermaceutical industry.

“I really like Biohemp’s approach. I think they’ll go somewhere,” Fitzpatrick said.

“I think (Freeman) is very, very smart. I think he’s very dedicated and focused upon moving the industry forward.”

She said the hemp industry needs an injection of dedication and stability after the Consolidated Growers and Processors debacle. CGP was a U.S. company that contracted 18,200 acres of hemp with Canadian farmers and later filed for bankruptcy.

Freeman and his partner demonstrated their commitment to the hemp industry by moving their operation from Vancouver to Regina, Fitzpatrick said.

Biohemp isn’t involved in hemp production and processing, but Freeman said it might entertain the idea of building a processing facility if sales become high enough.

“Instead of necessarily building a plant ourselves, we’d like to network with a farmer group or a co-operative and entice them to develop the bricks and mortar and we’ll just develop the market and sell it.”

Gen-X Research Inc., a company Biohemp shares warehouse space with in Regina, provides Freeman with nearly all its hemp seed. It’s a Finish variety called Fin-314, a dwarf type that can be harvested with conventional machinery.

Biohemp contracted only 18 tonnes of certified organic hemp in the first year of operation. This year, the company contracted 100 tonnes and expects to run out by next harvest.

The processing is farmed out to a variety of facilities across the Prairies. Most of the small runs are conducted at Goldburn Valley Oil Mill in Tisdale, Sask., and Gordo’s Foods Inc. in Saskatoon, but Biohemp also uses processors in Manitoba and Alberta.

“Right now it doesn’t necessarily pay them to do business with us,” Freeman said.

“However, they see that in a year or two year’s time it will, as our volumes increase.”

Initial sales are starting to roll in. The company did $36,000 worth of business in the first four months since the product line was launched in June. October’s sales could nearly match that total if a deal involving hemp feed goes through.

Freeman sees “huge potential” in using hemp for animal feed. Fin-314 is high in essential fatty acids and amino acids and could be marketed as a premium-priced feed ingredient.

Health Canada hasn’t approved hemp as a component in feed rations, so Freeman’s sales are restricted to researchers conducting hemp feed trials.

The company recently sold its first drums of hempseed oil into the cosmetics market.

“These drums cost thousands of dollars a piece so they’re nice sales.”

Freeman has big plans for Biohemp but said he needs another $175,000 in capital to properly commercialize the project. That will be his next big sales job.

Copyright © 2000, The Western Producer. All rights reserved.