A Colorado biotech company plans to open a large-scale industrial hemp processing facility that will take the crop’s would-be waste — namely hemp stalks — and make it useful.
The hemp biorefinery is being established by Fort Lupton-based PureVision Technology, Inc., and illuminates the growing enthusiasm around hemp entrepreneurship. But the northern Colorado company’s recent announcement also points to the ongoing federal legal challenges to jump-starting American processing of industrial hemp. The plant, which is cannabis without psychoactive properties, has been grouped alongside heroin, MDMA/Ecstasy and other federal Schedule 1 drugs for more than 40 years. Hemp farming returned to Colorado last year on a limited basis.
Hemp in the USA
PureVision Technology already processes plant waste from such crops as corn and wheat into raw materials including pulp for paper and sugars for biofuel. The company sells those fresh raw materials internationally to consumer-product manufacturers.
“Our original business model was to better utilize waste and turn it into resources,” said company co-owner Ed Lehrburger in a telephone interview. He and his brother Carl Lehrburger founded PureVision Technology 23 years ago, along with business partner Dick Wingerson, a nuclear engineer who trained at the Massachusetts Institute of Technology.
Last year, PureVision Technology used its Colorado biorefinery laboratory to process hemp waste. In the lab, PureVision has successfully converted hemp biomass into sugars. Now it intends to also process the plant into lignins, pulp and cannabidiol (CBD) extract for various manufacturing applications such as sweeteners, plastics or packaging.
“The average consumer has no idea about the versatility of these hemp plants (or) about their healing and nutraceutical qualities,” Lehrburger said.
PureVision’s lab-scale testing started with 100 hemp stalks from the 2014 Colorado outdoor harvest. Based on those results, the company will move forward with increased hemp processing at an established industrial biorefinery in Boardman, Ore., owned by ZeaChem, Inc. The new initiative is called PureHemp Technology.
“The significant infrastructure in place at the ZeaChem facility will reduce the costs and timing to develop our 25-ton-per-day biorefining project,” Lehrburger said in a PureHemp news release. He added by telephone that his company expects to begin operations in Oregon in late 2016 or early 2017.
PureVision Techology’s hemp ramp-up coincides with a $10 million fundraising initiative, or what’s known among “angel investors” as a Series A Preferred Stock offering, or a private equity sale.
“We are very motivated to put together a Colorado biorefinery,” Lehrburger said, adding the company is “looking for collaborators” before finalizing plans for a large-scale hemp biorefinery in Colorado.
Under current federal law, transporting hemp across state lines is illegal. So Lehrburger said the Oregon biorefinery will source hemp from that state as well as from Washington state. Lehrburger said the company anticipates few problems transporting hemp between Oregon and Washington since, like Colorado, cannabis laws are more favorable toward industrial-hemp production in those states.
PureVision Technology’s lab tests were conducted after obtaining 100 hemp stalks from Sterling farmer Jim Brammer.
Brammer is a lifelong Colorado cattleman who also grows cattle feed and owns a small fleet of produce trucks for interstate shipping. “I’ve moved a quarter of a mile in 77 years,” he said last week by phone.
Last year, Brammer agreed to lease two acres of his farmland to a produce-broker friend who was interested in trying to grow industrial hemp. He said he was initially ambivalent about the new crop.
“I’ve seen hemp growing on the railroad tracks in Nebraska,” he said. “They call it ‘ditch weed’ down there.”
Besides the fact that hemp processing is limited and federal law makes hemp business difficult, some Colorado farmers shy away from hemp out of concern that their crop could unintentionally include a plant strain with THC levels above 0.3 percent. That is how the Colorado Department of Agriculture distinguishes between hemp and marijuana.
If that happens, the entire crop may be destroyed.
Now that Brammer has successfully harvested two acres of hemp, he says hemp entrepreneurs are calling him regularly in search of land to plant even larger crops. But they often fail to realize that there are currently few options for processing industrial hemp in the United States.
American hemp farmers currently process hemp by hand. That means physically separating the plant’s woody inner stalks, or waste, from its valuable seeds, flowers and fibers.
This is where PureHemp Technology may come in.
Last fall, employees from PureVision “just came out to the farm and got some stalks,” Brammer recalled. “I gave them some for free when they said they were going to experiment with them.”
Produce broker Bill Billings was the person who initially convinced Brammer to try growing hemp. Billings owns a produce transportation and brokerage company called Mountain Logistics. He and Brammer have collaborated on produce shipping for around a decade. It follows that Billings is intimately familiar with the challenging economics facing farmers.
In addition to arguing that hemp could be a gift for struggling American farmers, Billings turned Brammer on to celebrity doctor Sanjay Gupta’s coverage of the medical cannabis strain Charlotte’s Web.
“I said, ‘I think we should do this, it’s really going to help the farmers,’” Billings said of his conversation with Brammer. “Then (Brammer) saw on TV how the CBD was helping the children.”
Billings said that the two acres of hemp that took root on Brammer’s farm produced roughly 600 pounds of hemp seed. He had help with processing the crop by hand from well-known Colorado hemp farmer and activist Ryan Loflin.
As an agricultural broker, Billings said he easily found buyers for some of the hemp seed he grew last year. He also plans to replant some of it, de-shell some of it for edible hemp products, and turn some into hemp seed oil for a beauty products business run by other members of the Billings family.
This growing season, Billings said, he wants to plant “as much (hemp) as we can” in Sterling and at other leased plots around Colorado.
“The problem is,” he said, “there’s no processing plant.”