CBDInsiderReport Vol1. Edition 1. Welcome to the CBD Era.

February 1, 2019

Welcome to the first ever CBD Insider Report.  A monthly report that will come out on the 1st of each month.

This CBDInsiderReport will serve as a consolidation and a “quick fix” to get all the news and updates relating to CBD.  There will many financial, business, and economic factors that will be changing the game in the near future.  The report will recap the previous month.

This monthly report’s mission is to clear up the vagueness and confusion that does and will continue to surround Hemp and CBD.  There will be conflicts between the FEDERAL and VARIOUS STATE laws. This will be a guidance year for the whole industry.

The Gold Rush is here.  Some are even calling it “The CBD era.”

Brightfield Group (a cannabis and CBD market research firm) recently projected hemp CBD sales to grow from $174 million to $22 billion by 2020; we expect marketing budgets to grow to meet that demand.”

December 20th, 2018 was a monumental day and launches the “CBD era.”  Donald Trump signed the bipartisan 2018 Congressional Farm Bill.

Why is this such big news?  Because CBD is derived from hemp.  

Hemp is the plant that CBD is derived from (As well as Cannabis) and was taken OFF the list of Schedule 1 Drugs.  The definition of a Schedule 1 drug is:

Schedule 1 (I) drugs, substances, or chemicals are defined by the federal government as drugs with no currently accepted medical use and a high potential for abuse. Schedule 1 (I) drugs are the most dangerous drugs of all the drug schedules with potentially severe psychological or physical dependence.

Keep Your Eye On

This Superbowl Sunday could be monumental…
CBD Commercials superbowl will feature Baristas Coffee CBD – A CBD product on the major stage of the Super Bowl is a huge win for the cannabis industry.

Basic Fundamentals

Cannabis, Hemp and Marijuana are not the same thing.  The CBD boom is the discovery of gaining the medicinal and healing qualities that cannabis and “marijuana” could provide without the psychoactive parts.

CBD is produced from hemp [Cannabidiol].  It is a non intoxicating product that is found in cannabis that is now ‘technically’ legal, if it is produced by a licensed grower in a manner consistent with the Farm Bill and associated federal and state regulations. 

Very simply with CBD, you can enjoy marijuana benefits without getting high.

Hemp and Marijuana are both species of the cannabis plant WITHIN the cannabis community.  Hemp had no business ever being on the schedule 1 list and has been moved to Schedule 5.

Scheduled Drugs

Source: DEA, Business Insider

It’s a decision that immediately affects CBD producers but also signals the agency’s first admission that the plant has medical value.

By The Numbers

The top 3 reasons for use according to Cannabis Industry Research Report (3,100 People Took Part)

Top 3 Reasons for Use:

66% Relaxationa
59% Stress Relief
53% Reduce Anxiety

Key # – 0.3%  

Hemp must be under this THC rate (THC the ingredient that gets you ‘high’) to be legal.  

Hemp fundamentally by itself has no THC.

Marijuana is known to have between 15-40% THC

33 States Legal
23 – Only Medicinally
10 – Fully Legal

The THC # allowed  in other international locations is 0.2% instead of 0.3%

Entertainment

The Sundance Film festival for the first time, added a CBD Lounge called Wellhaus.  The first floor of the event featured a panel and demos, the 2nd floor had a Gastropub-infusion cocktail bar.  Each plate served by “CBD friendly” chefs featured 10 MG infused CBD Oil.

Wellhaus, billing itself as the festival’s first “fully integrated health and wellness and CBD-focused concept house” was sponsored by Charlotte’s Web, partnered with Axcess Entertainment.   Wellhaus also added that you will see a similar lounge at popular events Coachella and SXSW.

Legal

The Farm Bill allows for someone that has has a felony drug conviction on their record to work in hemp related business after 10 years.

If you don’t live in these states, you may be able to acquire legal CBD oil.
Each state has its own specifics you need to be aware of.

Currently, there are 10 states in America where marijuana is legalized both medically and recreationally. This does not count Washington D.C., which also has full legalization.

These 10 states with legal cannabis are: Alaska, California, Colorado, Maine, Massachusetts, Michigan, Nevada, Oregon, Vermont, Washington

Michigan is the most recent state to legalize marijuana after state voters easily voted for the ballot initiative in the 2018 midterm elections.

In these states (and D.C.), simply go to a dispensary and you will be able to purchase CBD oil legally – provided you are 18 or over.

Illegal States

CBDInsiderReport has found a great resource for you see a map of decriminalized and illegal states for cannabis.

Fully illegal states: Idaho, Nebraska, South Dakota

Key Part of the Bill

EC. 12619. CONFORMING CHANGES TO CONTROLLED SUBSTANCES ACT.

(a) I N GENERAL
—Section 102(16) of the Controlled Substances Act (21 U.S.C. 802(16)) is amended—(1) by striking ‘‘(16) The’’ and inserting ‘‘(16)(A) Subject to subparagraph (B), the’’; and(2) by striking ‘‘Such term does not include the’’ and insert-ing the following:‘‘(B) The term ‘marihuana’ does not include—‘‘(i) hemp, as defined in section 297A of the Agricultural Marketing Act of 1946; or‘‘(ii) the’’.(b)

TETRAHYDROCANNABINOL

—Schedule I, as set forth in sec-tion 202(c) of the Controlled Substances Act (21 U.S.C. 812(c)), isamended in subsection (c)(17) by inserting after ‘‘Tetrahydrocannabinols’’ the following: ‘‘, except fortetrahydrocannabinols in hemp (as defined under section 297A of the Agricultural Marketing Act of 1946)’’.

Featured Business Innovations

Elixinol advertises Hemp CBD products and brand in Times Square.

“I think the Farm Bill legalizing hemp is going to encourage a lot of marketing platforms to open up to cannabis related product advertising. We expect this to be our biggest year spending on traditional advertising,” O’Malley said.

DSW, the discount shoe retailer, recently said it would start selling CBD-infused products, including body lotions, foot creams and muscle balms, at 96 of its more than 500 U.S. stores.

Stock Market and Wall Street

Canopy Growth gains New York Hemp licence (CGC) and plans to open up a Hemp Industrial Park with plans to invest between $100-150 million in its New York operations and create 400 jobs.  The facility will be the company’s first American plant and will source hemp exclusively from American farmers.

The stock CGC was at $28 and at the time of this article was trading at around $44.

A former Bain and Co consultant Jay Lucas has launched a $50 Million Dollar fund called LB Equity that will be deployed by the end of 2019.  LB Equity is focused on cosmetics and beauty products derived from hemp. The fund’s first investment was in Standard Dose, a brand and e-commerce site that strives to be a “Mini-Amazon” for CBD.  A former L’Oreal executive Jim Morrison has joined the fund as partner.

Merchant Processing/Banking

We have seen minimal guidance as to when Paypal, Stripe, Square and other major merchant processors are going to allow CBD and Hemp companies on their platform and embrace this new movement.  Many companies still relying on smaller and ‘offshore’ merchant processing companies and paying higher percentages than the typical 3% standard.

CannaTrac launches cashless cannabis payment app on Google Play and Apple Store.   “We aim to serve the cannabis industry as the go-to cashless payment solution as we promote safety by removing cash from the equation and provide consumers with an easy way to support their favorite retailers.” – CEO Thomas Gavin states.

https://www.cbdforshopify.com/ has launched to help with CBD stores to accept online payments.  Stripe currently does not allow for the sale of CBD through its merchant processing platform: Shopify Payments.  Shopify allows for other payment gateways to be used on its own platform.

Major global processor Elavon has been tentatively approving some brands with the help of the long known brand Authorize.net

Agriculture

Featured State: Kentucky
Kentucky has approved 42,000 Acres of Hemp Farming up from 16,000.  1,035 applications have been approved by the KDA (Kentucky Department of Agriculture).  Also, 2.9 million square feet of greenhouse space for hemp cultivation has been approved.  Keep an eye on this state moving forward as a friendly environment for the progress of Hemp and CBD.

Endorsements

NFL

Terrell Davis a Hall of Famer from the Denver Broncos recently went on record saying that if CBD was around when he played, it would have extended his career.  His knee injury forced Terrell Davis to miss a few years of his prime.  Terrell knows the benefits of reduced swelling and inflammation. Terrell is a stakeholder with his performance drink and CBD option called DEFY which is set to launch in the Spring of 2019.

Kathy Ireland a former supermodel has joined the NFL Players INC., a wing of the NFL Players Association to lobby for CBD and help with the marketing and advertising.  Ireland believes the league and players could benefit and her line is seeing great results already.  The supermodel turned business-mogul also has her own CBD Wellness product line with the brand Isodiol.  This is another key endorsement for the industry as we wait for one of the major leagues to greenlight CBD and would also be a big win for NFL players with pain.

FDA

The has FDA approved its first nonsynthetic, cannabis-derived medicine, a CBD preparation for rare types of epilepsy. The drug, Epidiolex, is made from cannabis grown in the United Kingdom.  This action came a few months before the farm bill was signed.

Another key category to track is the FDA now that they will be instrumental to give the industry guidance.  

Though the new law loosened restrictions on the hemp industry, it did not limit FDA’s authority to regulate CBD. Since 2015, the agency has asserted products containing CBD and THC can’t be sold in dietary supplements and that it’s illegal in interstate commerce to sell a food to which either of the compounds has been added.

Senators are urging the FDA to secure the pathway for CBD in supplements and foods.

Global

Cannabis will be joining the 2019 World Economic Forum.

The world economic forum mission is: “Committed to improving the state of the world by engaging business, political, academic, and other leaders of society to shape global, regional, and industry agendas.”  The WEF takes place in January every year in Switzerland. Top business leaders, international political leaders, economists journalists and celebrities will discuss most pressing issues in the world. Major Cannabis executives will share their ideas of an improvement in the industry.  

Among those expected to be there are former Israeli Prime Minister Ehud Barak who serves as chairman of the Israeli medical Cannabis company, and Bruce Linton, CEO of Canopy Growth Corp.

Many consider this a true sign of growing legitimacy of the global marijuana sector.  The 3 hour session at the WEF will be known as the “Cannabis Conclave.”

Thank you for reading.  Next edition will come March 1st.

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