According to Arcview Market Research, the legal cannabis industry in North America is expected to grow from $9.2 billion in 2017 to $47.3 billion a decade later. As marijuana continues to be legalized in North America, many companies have started to position and differentiate themselves to capture much of the market. One such company is Future Farm Technologies Inc. (CSE:FFT) (OTCQX:FFRMF).
Future Farm Technologies is a Canadian company that has not only diversified its holdings of production facilities throughout North America including California, Massachusetts, Florida, Maine, Puerto Rico and Newfoundland, but also its business model to include indoor farming lighting technology, agriculture technologies, extraction technologies and end user VR/AR applications.
We interviewed William Gildea, the CEO of the Future Farm Technologies Inc. to get a better picture about what Future Farm is currently working on.
Future Farm’s mission is to bring to market the most valuable products, services and technologies in the cannabis industry.
1. There is a glut of medical cannabis and hemp companies appearing in the markets over the past few years. Tell us why should investors start following Future Farm Technologies?
We consider ourselves a leader in our field. While Future Farm has only been around for a couple of years, my partners and I have been involved in vertical farming, environmentally friendly technologies, plant growth and cannabis related fields for many years.
Future Farm is committed to using only the highest quality processes and products. Towards this goal, we acquire or partner with licensed cannabis operators, and acquire or develop leading technologies in cannabis production, breeding, genetics and Controlled Environment Agriculture (CEA). Future Farm’s scalable, indoor CEA systems utilize minimal land, water and energy resources.
As Future Farm continues to expand and as laws continue to become more lenient, we will be strategically positioned to capitalize from the market segments and geographies on which it has focused.
I am particularly proud of the management team that we have been able to assemble this past year. Not only is each person knowledgeable and effective at his/her role, but we are all truly inspired by the vision and opportunities we see for Future Farm.
2. Future Farm Technologies has a diversified portfolio of assets relating to cannabis, hemp, food and other agricultural growth technologies. Can you briefly describe the assets Future Farm has in its portfolio and the plans the company has for each one?
Current assets and operations include:
- White Sand Nursery, Florida is a 10-acre operating greenhouse business with the option to acquire another 10 acres. It currently runs as a $3M revenue nursery business (approximately $450K in EBITDA). However, it fits the criteria to apply for a cannabis license and so we are in the process of that application now.
- Medical Marijuana Cultivation & Dispensary, Attleboro, MA: Future Farm has a strategic partnership with a licensee in Massachusetts, which is currently building out its facility for medical marijuana cultivation. In addition, the licensee has applied for adult-use licenses in the state and was granted priority application review. The Cannabis Commission’s decision for the application is imminent.
- Build-out of Cultivation and Extraction Facility in Providence, RI: Future Farm purchased a building in Providence to house a RI-licensed medical marijuana cultivator. That building is under demo and construction for tenant improvements.
- Hemp Farming and Processing Lab in Maine: Future Farm’s majority-owned subsidiary, Future Farm Maine has three licenses for the cultivation of hemp providing the company with the opportunity to be a major player in the production of CBD oil and isolate.
- Clinica Verde Dispensaries in Puerto Rico: The Company is in a joint venture to build out and own 5 medical cannabis dispensaries on the island. Those locations are being identified, leased and constructed, with the first one expected to come online in June.
- LED Canada, Vancouver, Canada: The company’s LED business is able to provide cultivation partners with both lighting and expertise, providing synergies to the whole.
The Company also has the following additional partnerships under development:
- Cultivation of Medical Cannabis in Puerto Rico: FF has an LOI with a potential partner that holds a pre-qualified cultivation license in Puerto Rico.
- Rahan-Future Farm-CEPG Partnership in California and Newfoundland, Canada: FF is under LOI with two parties to breed and propagate elite clones of cannabis.
- Produce Farms in Baltimore, MD and Mobile, AL: This partnership to build and operate urban vertical farms will demonstrate Future Farm’s vertical farming technology and support local economies.
3. Why did Future Farm decide to diversify its business to include its various business lines?
Diversification of the business has always been at the core of Future Farm’s business model. Synergies between the divisions, whether it be cultivation of cannabis, extraction of oils from cannabis and hemp, or LED lighting that is used to grow the plants, inherently impact the bottom line.
4. As Future Farm continues to develop more business lines, how are these additional business lines complementary to each other to bring more value to shareholders?
As I mentioned, we are always aware of how each business line can complement each other’s business model, and of course the economics of each project. Our priority must always be the shareholders – how will this investment provide a return to them? Having a diverse portfolio of projects enables the Company to hedge its investments depending on regulatory requirements and take advantage of regulations and market trends as they progress and become more amenable to the cannabis industry.
5. Future Farm has been focused on developing its CBD and hemp cultivation operations in Maine. Do you see the CBD and hemp operations becoming a bigger business than cannabis for the company even though cannabis continues to become more and more legalized all over the world?
The industrial hemp opportunity is significant. We see a great opportunity in this early stage of the industry with few players and a broad market. According to the Brightfield Group, the U.S. market for hemp-derived CBD had $291 million in sales in 2017 and will grow to annual sales of $1.65 billion in 2021.
Thanks to recent initiatives by senator Mitch McConnell, federal hemp legalization is imminent. Demand for feminized seed is high and there are few accredited sources. When it is legal, we will be well-positioned as one of few suppliers of organic feminized CBD seeds with an outlet to farmers who want to include CBD hemp in their crop rotation.
We are not replacing our cannabis business with hemp – we’re enhancing it.
6. How has the legalization of cannabis impacted Future Farm’s investments and businesses in general?
Legalization of cannabis is essential for most of our investments. The nuance of the law is critical in determining the best market position. This is where we have an advantage. We have positioned ourselves in states such as Massachusetts and Florida, where we have first mover advantages as laws progress.
We are especially excited about merging traditional fields of science and agriculture with cannabis. We are fortunate to work with highly experienced partners in our operations, partnering with such esteemed scientific companies such as Rahan Meristem, where we will be able to apply their expertise in research and technologies with our cannabis and cultivation knowledge to identify, breed and propagate elite clones of cannabis.
Whether it be cultivation, oil and isolate extraction, or retail dispensary operations, Future Farm will find the best possible opportunities and make them work.
We want to thank Mr. Gildea for taking the time for this interview.
Disclaimer: NAI is being compensated for this article. Materials contained in this article is for information purposes only and is not intended to constitute an offering of securities in any jurisdiction. Nothing on this article should be construed as an offer, solicitation or recommendation to buy or sell products or securities.