CropLogic targets Australian cannabis industry
CropLogic Ltd (ASX:CLI) has signed a Letter of Intent (LOI) with Boring Seed Company of Oregon USA, an initiative that could see the group establish a hemp trial farm in Australia, similar to the one it is operating in Oregon.
The award-winning global agronomy, farm management and agtech company is well supported in the US, having established itself as a credible authority in relation to agricultural practices across a broad range of crops.
After launching its product into Washington State in 2017, CropLogic is now servicing a significant portion of horticultural growers in this region, with a market share as high as 30% in some crops.
Following significant growth in Washington State and Northern Oregon, CropLogic expanded into the Idaho market.
The company offers growers of irrigated crops digital agricultural technology expertise based upon scientific research and delivered with cutting edge technology – science, agronomy and technology interwoven into an expert system for decision support.
After establishing itself in the broader horticultural sector, CropLogic gained approval to establish a 500 acre hemp trial farm in Oregon where the crop is well advanced.
As well as generating significant revenues from crop sales towards the end of the year, the hemp project has provided CropLogic with a valuable opportunity to showcase its agricultural management systems and expertise.
Given CropLogic’s technology was transferable into other countries and industries outside the group’s markets in Australia, it makes sense to revisit Australia, targeting a country and market it knows well in expanding its presence in the hemp farming industry.
Sowing the seeds
Harking back to the collaboration with Boring Seed, that group has developed the T2 hemp strain being grown on the CropLogic’s Oregon Trial Hemp Farm.
Distribution of this strain and other Boring Hemp genetics will be formalised in an appropriate distribution agreement.
Considering that CBD hemp cultivation has been legal in the state of Oregon since 2015, it is thought that Oregon may have superior CBD producing hemp genetics to other regions, such as Australia and New Zealand, where to date the focus of hemp production has predominately been for fibre and seed for consumption.
Management will investigate the viability of an Australian Hemp Trial Farm with the aim of the trial being to evaluate the effectiveness of CropLogic’s proprietary agronomy, farm management and agtech expertise gained at the company’s Oregon Hemp Trial Farm and also the viability of Oregon hemp genetics in the Australian growing environment.
The investigation will consider a Hemp Trial Farm of up to 100 acres.
Any eventual Australian Hemp Trial Farm and distribution and/or cultivation of Oregon hemp genetics will be subject to satisfactory regulatory approvals and the findings of this investigation.
Commenting on the prospects of such a venture, chief executive James Cooper-Jones said, “We have promising hemp cultivation operations currently underway in Central Oregon, US.”
“Much of this could be attributed to CropLogic’s agronomy, farm management and agtech expertise and perhaps the superior genetics found in Oregon.
‘’As such, CropLogic is now excited to investigate how this proprietary agronomic knowledge and Oregonian genetics may benefit the Australian and New Zealand hemp industry.”
Given CropLogic estimates it could generate approximately $50 million in biomass sales from the Oregon Trial Farm towards the end of this year, should the company embark on a similar strategy in Australia it could be very lucrative.
Consequently, it is a share price catalyst to look out for, particularly given that the company’s current market capitalisation of approximately $26 million fails to reflect the group’s anticipated income in the next six months.
Short-term positions in small, early stage ASX companies,
with high potential and near term price catalysts.
Focusing on resource exploration, early-stage tech, and biotech.
Exceptional opportunities across a broad range of
early-stage growth sectors with strong management.
Seeking 1,000% plus returns across medium to long-term holds.
Longer-term positions in a variety of sectors.
Seeking strong management where traction is established and have entered into a growth phase.
S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.
Conflict of Interest Notice
S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.
The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.