Amid CBD’s Ambivalent Regulatory Outlook, HTC Extraction Systems (TSX.V: HTC) (OTCQB: HTPRF) Set to Gain from Extraction Services Industry
For some 15 years, HTC Extraction Systems has built an IP that distills and recycles ethanol and ethanol-based solvents, and is now turning its experience to the cannabinoid extract industries’ potential
- While regulatory federal officials in the United States continue to regard cannabinoid extracts such as cannabidiol (CBD) as potentially unsafe for ingestion, the producers of topicals and oils served by extractors such as HTC Extraction Systems continue to enjoy high-margin possibilities
- The company is installing new equipment at the California-based and Saskatchewan facilities that will give it the capacity to process up to 12,000 pounds of hemp biomass per day at the California site and up to 2 million kg per year for phase 1 at the Canadian site
- HTC’s most recent financial report stated revenues had risen nearly 200 percent on a year-over-year basis, despite the market difficulties many industry players faced during the year
Despite a growing social acceptance, and in many cases even an active embrace, of cannabinoid-derived products for enhancing personal wellness, regulatory liberation in the United States has remained ambivalent and the cannabinoid industry’s biggest players have seen their stocks hammered by a variety of adverse forces throughout North America (http://nnw.fm/Xyz2L).
The federal government delivered hope to cannabinoid connoisseurs at the end of 2018 with its passage of the Farm Act that lifted prohibitions against hemp cultivation, but the end of 2019 brought the Food and Drug Administration’s (FDA’s) less-than-encouraging warning that it still does not consider CBD a safe food additive (http://nnw.fm/S6hAY).
While the differing points of view regarding CBD and other cannabinoids even at the administrative levels of state and federal governments foster ongoing debate and legislative wrangling, extraction-service providers such as HTC Extraction Systems (TSX.V: HTC) (OTCQB: HTPRF) may expect to remain above the fray as they process hemp biomass to obtain resins, distillates, concentrates and select cannabinoids for high-margin derivatives.
Topicals and oils have largely avoided the attention of the FDA as long as they have avoided making unsubstantiated medical claims in their marketing and packaging. That in turn means companies specializing in the extraction of cannabinoids for such products can prove to be a refuge for investors looking for a cannabinoid-related industry to take off (http://nnw.fm/4H4iK), regardless of the FDA’s eventual decision.
HTC Extraction Systems has built its proprietary purification technologies on the 15 years of advances it has made in distillation processes that remove ethanol and ethanol-based solvents used in the extraction process. The company’s trademarked Delta Reclaiming System technologies for CBD, solvents and glycols recycle and reuse the extraction ethanol used in the CBD extraction process, limiting CBD waste through the re-extraction of all wastes collected from the purified ethanol, according to the company.
HTC Extraction Systems’ working relationships with other cannabinoid industry players further shore up its revenues possibilities. Most recently, the Canadian company recently closed its acquisition of a California-based company in the United States. The recently acquired, Kase Farma Inc., is authorized to work with hemp cultivation, extraction, refining, formulation and business operations in the world’s largest cannabinoid market (http://nnw.fm/GtDz2), and HTC Extraction will reap the experience of Kase Farma’s former owner, Starling Brands, Inc., which remains involved through a management services agreement for navigating the business and regulatory climates in California.
New equipment that will enable Kase Farma to process and distill up to 12,000 pounds a day of dried hemp biomass that, at an 8 percent CBD yield, will give over 400,000 grams daily of CBD and a sizable profile during the upcoming cultivation season. New equipment HTC Extraction Systems is installing at its Saskatchewan facilities will similarly allow the company to receive a projected 2 million kg of hemp biomass for extracting CBD Full-Spectrum Oil (FSO) distillate north of the border under a tolling strategy coordinated with highly recognized area farmers.
While year-end financial reports are pending, the company’s third-quarter statement reported revenues had grown by nearly 200 percent year-over-year, further demonstrating HTC Extraction Systems’ potential for financial strength (http://nnw.fm/eIQW2).
For more information, visit the company’s website at www.HTCExtraction.com
NOTE TO INVESTORS: The latest news and updates relating to HTC are available in the company’s newsroom at http://nnw.fm/HTC
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