Upper Street Marketing Inc. and its agricultural partners have fully planted their first hemp crop on 1,200 acres of Colorado farmland and are now less than 16 weeks from being able to start processing the biomass into high-grade cannabidiol (CBD) isolates and distillates. The company has also sourced the crop from roughly 900 additional acres owned and operated by Fox Organic Forms, which will be ready for extraction in late September or early October. Hemp plants generally require 16 weeks before the flowers are ripe enough to develop oil-bearing seeds. At that point, the mature biomass is ready for harvest, separation and processing. Getting the crop in the ground now puts UPPR on track to meet its extraction start date in early 4Q2019. Since the company owns a 100,000 square-foot facility in Center, Colorado as well as leases a 12,000 square-foot laboratory in San Diego, California, management anticipates that converting the biomass into high-grade CBD isolates and distillates will be a relatively straightforward process. The company has also retained FDA-licensed contract pharmaceutical manufacturer, PrimaPharma Inc., to ensure that all products meet regulatory and commercial FDA cGMP standards. Most recently, UPPR has partnered with ICC Inc. to build out the manufacturing systems that will turn industrial quantities of raw hemp into high-grade CBD products to meet parabolically increasing commercial demand. Previously disclosed yield projections suggest that this season’s overall 1,200-acre production profile translates to 45,000 kilograms of high-quality CBD. As demand for the newly legalized, non-psychoactive chemical compounds formerly locked within the hemp plant expands, UPPR is ready to help fill the gap. Fortune magazine and other publications have contemplated a 100X surge in CBD consumption between now and 2023, at which point UPPR and other producers will need to ramp up output from a currently minimal 55,000 kg of isolate to as much as 3.5 million kg. UPPR research indicates that approximately 55,000 acres of hemp were harvested in 2018 across North America, enough to satisfy only 2 million kg of retail demand. On that basis, cultivation will need to expand to over 250,000 acres simply to meet projected 2020 consumption. In the meantime, recent wholesale pricing on CBD isolates is running above $3,000 per pound ($7,000 per kilogram) and many organic hemp farmers target yields of 15% CBD or higher. As such, the acreage UPPR and its partners have planted can conservatively produce a crop worth the equivalent of $200,000 per acre, or a revenue event topping $200 million. Fox Organic Farms will receive 50% of the ultimate proceeds from biomass harvested from its land (roughly $150 million in total) while the rest goes to UPPR in exchange for its processing services. In addition, all revenue ($50 million) from UPPR’s 330-acre planting will pass to the company to validate its seed-to-consumer business plan. As such, while not all of the $200 million in total commercial value in this initial cultivation season will end up with UPPR, the company’s share of the ultimate harvest is tracking well above previously disclosed targets.