(laser crackling) (logo whooshing) - [Narrator] Funding for "Working Capital" is provided by The Friends of KTWU and Go Topeka.

(gentle music) (screen whooshing) (soft techno music) (upbeat techno music) - And here we are at Kancanna and Butler Hemp Co. to talk about one of the newest, well, really, I guess, it's new again, but one of the oldest crops we had in Kansas.

So, today we're dealing with hemp, the processing.

We'll talk a little bit about the farming, how the farmers get it to here, but we're here with Heath Martin, president of Kancanna and Butler Hemp Co. And welcome, Heath, to the show.

- Yeah, thanks for having me, Jay.

Appreciate it.

- Great to have you on "Working Capital."

So, the main thing of the show today, which has a lot of stigma to it, so let's just get into it.

First off, what are the greatest properties of hemp?

What got you into this business?

- You know, one of the things that got me into this business originally is just understanding that this was a crop that had basically been prohibited for a hundred years.

And so, the possibilities of me seeing an opportunity again like that in my lifetime were slim.

And ultimately, it's a crop to me that fits very well in our agricultural climate here in Kansas, right?

So, it takes a grower, it takes a farmer, it takes industrial processing, obviously, like you see around you.

And then, it takes an end consumer.

And that end consumer any more is very conscious, not only about their health or the products that we manufacture here, but also about being green and helping the environment.

And hemp is a phenomenal crop to use in place of, you know, maybe some pharmaceuticals, maybe some products that are currently manufactured from the oil and gas industry.

And then ultimately, for some wood or insulation or fiber for homes, hempcrete, things like that.

So, what a great opportunity that this plant brings us.

And we're just here and happy to capitalize it.

- So many products, so many end uses.

But also just for the farming in general.

I've heard, put some of the helpful minerals back in the ground, it helps the other crops as they rotate through.

Is that true?

- It's a good rotational crop.

You know, from what I've seen, it doesn't do as much to put minerals or- - Nitrogen.

- Or I guess nitrogen or those things back into the soil.

But what it does do, it's a good soil amender.

So, if there are things that are potentially in that soil that you may not want or may not be at the right levels for the next crop that may be coming, it can help alleviate some of those.

It's also very, very good at being a water miser, if you will.

Hemp does not take a lot of water to grow.

And for the actual pounds of harvested biomass, the water usage is significantly less than that on an irrigated platform, less than that of corn or soybeans.

And the uses for it, they're continuing to grow.

We still find new ones every day, but they're very numerous.

- Okay, well, so we talked a little bit about farming.

That's not what we're dealing with here.

We're dealing with when the farmer gets ready, they're picking the flowers, what people call the buds.

- Correct.

- And that's what you guys get.

- Right.

- So as we see here, you're getting truckloads full of this ready to process, right?

- Yes.

Absolutely.

- So, take us through that.

I think we're in the first place you would kinda hit with this stuff.

So, you have a lot of ovens here.

Let's go through the process first of from when we get it from the farmer.

- Right.

- To when we're getting ready to make it into a product.

- Sure.

We'll start from the beginning, right?

And ultimately, any more we like to contract with our growers or buy hemp biomass off the market.

We call it biomass.

The first step is product testing.

We are in the nutraceutical business.

We manufacture products that you're going to be ingesting or applying to your skin.

So, we want those to be safe for you.

So, the first step ultimately is compliance testing.

And so, we go through four different tests.

One is potency to make sure it's federally and state compliant, below the 0.3% THC level.

Pesticides, we wanna make sure that it's free of any pesticides or herbicides.

Third is microbial testing.

We don't want any bacteria, mold, mildews in our product.

And then, the last one is we test for heavy metals as well.

- Okay.

- So, once our product is tested for all those and it passes, we then take it out of quarantine, that's what we call it.

And the first step is grinding and then decarboxylation.

So, we will take this hemp here, hemp biomass.

We will grind it up to basically a fine powder.

- Okay.

- Once we've got that done, we will load it into these trays and then put those trays in our oven.

A lot of people don't realize this, but CBD and THC both start their life on the plant in acidic form.

It's actually THCA or CBDA.

- Okay.

- So, there's a carbon chain holding that acid molecule on, and by adding a little bit of heat, we can actually break that carbon chain and turn this compound CBD into a form that's usable for the human body.

- Fantastic.

- Yeah.

- Okay, so then, let's take a little walk then.

So- - Sounds great.

- We get to the biome, like you say, you grind it up.

- Ground the biomass.

- Huge, huge bag.

I call it a bag, but I mean these are... - Yeah, generally- - How much weight is in one of those?

- Depending on the size of the biomass itself, generally anywhere from 300 to 700 pounds per bag.

We like to bring 'em in, a semi load at a time, roughly 15 to 20,000 pounds.

We process here at Kancanna roughly a thousand pounds a day.

- Wow.

- So, you take that down, a thousand pounds a day in the large ag market doesn't sound like a lot.

But when you actually that down to how many milligrams we're able to extract and formulate into products, it's actually a gigantic amount.

But step one is grinding and decarboxylation.

You know, low and slow.

We heat it in our oven.

And then, we will actually go into our extraction room.

- [Jay] Okay.

- So, our extraction facility utilizes liquid CO2.

It's a solventless extraction.

Carbon dioxide is around us everywhere.

We don't want anything to touch the plant matter that could potentially be harmful for users down the road.

So we come in here, this is our extraction room.

We actually load these vessels full of the hemp.

We pump liquid CO2 through here at an extremely high pressure.

That removes all the cannabinoids.

That then comes over here into one of three collection vessels.

We alleviate the pressure.

The CO2 actually goes through a phase change.

It changes then from a liquid to a gas.

We push the gas on around through the back of the system completely recycling it.

But the oils that we extracted from the plants cannot turn from a liquid to a gas.

So, they precipitate out here into our collection vessels.

So, once we have it at this stage, we will drain our collection vessels and that's called, we call it raw crude or hemp crude.

This is the room where it actually goes from plant material to a liquid oil.

- That's fantastic.

A closed system.

So I mean, it's kind of regulating itself.

- Yeah.

- How many, do you know how many pounds?

How much has to go through to fill one of your tanks here?

- It all depends on the potency of the product that the growers brought us.

- Okay.

- You know, so we like to shoot for a 10% CBD concentration in all of our biomass that we bring in.

So give or take, at that point, it's gonna be roughly 20 to 25 pounds per kilogram or pounds per liter.

So, it roughly takes one tube, which is about 20 pounds to fill one of these.

We can fill up to three.

- Wow.

Wow.

So, a thousand pounds a day.

It's coming into here.

You're getting the crude.

Where do we go to next then?

- Okay, so- - What's the next step?

- From crude we go into our refinement laboratory.

So, most of the time in products, we're not using raw crude to formulate with.

We wanna take it a step further and go into a full spectrum distillate, which would remove any of the plant waxes or plant fats that were in the material.

So, we can go onto our next room and show you that.

- Okay.

Stick around.

When we get back, we will check out the next process.

You're watching "Working Capital."

(rousing orchestra music) All right.

Welcome back to "Working Capital."

Okay, Heath, this room, they all seem a little technical, but this one we're getting into something that screams science class.

I mean I see a lot of glass, a lot of, but tell us where we at now.

- Okay.

- What is this in the process?

- So, we are in a refinement laboratory here at Kancanna.

And ultimately, as you saw in the previous segment, we were in our extraction lab.

Once we get the raw crude from the hemp plant, there's a few things that we need to do to clean it up and refine it further before it goes into any end use products.

So, what we're actually sitting in front of is called a wiped film distillation apparatus.

So yeah, remember that one and say it three times fast, right?

But essentially what we're doing is we are taking the CBD crude and we are running it through this heated column, and inside this heated column, there's wiper blades.

There's the wiped part, right?

So, we wipe a film of CBD crude on the outside of these blades and we know when we have it set at exactly the temperature at which cannabinoids vaporize.

- [Jay] Okay.

- So, we essentially vaporize it on the outside of the column.

There is a condensing rod that runs through the middle.

It then condenses CBD, pure CBD condenses onto that rod.

It goes out this side of the distillation apparatus and the waste such as plant sugars, chlorophylls, things like that, they'll go out the waste side.

But this is one of the machines that we use to take our CBD from roughly 55% potency out of the machines to upwards of 90% potent out of here.

So, it also eliminates some of the off-putting flavors that hemp might contain, any of the sugars that are contained within the plant material as well.

And gives you just an overall more pure and clean product when you take our Butler Hemp Co. products.

- And so, without, I mean it kinda like, if you have different strains or different varieties coming in, be able to distill it that far down, gets it to where it's pretty much similar across the board.

- Correct.

Correct.

- Is there any use for the byproducts, the chlorophyll, anything that's coming off the wayside?

Is it a good fertilizer?

Can there be any use for it?

Is it kinda just- - Yeah.

- It's a?

- I'm sure we'll find use for it.

Some of the plant fats and waxes that we remove, we have found uses for those on downstream.

But the actual waste material off of here, to be determined, right?

It does still have small amounts of cannabinoids in it, and ultimately good plant chlorophylls and nutrients of that capacity.

But we haven't found a market just yet.

- One thing I, speaking of that too.

After you've heated it and you've made the crude, all that plant fiber that's left, is there any use for that?

Or is it just gone because of the processing?

- Yeah, no, absolutely.

The plant material is still there.

And one of the things that we found is that hemp flour or fiber has a phenomenally high protein value.

- Okay.

- Much, much similar to dairy alfalfa or good alfalfa that's growing out there.

Our protein values are somewhere in the 24 to 26%.

We know there's been some state universities that are doing testing on this for animal feed and things of that.

And once that's cleared, we are gonna be very excited to play in that market as well.

- So with that kind of protein, I mean, for farming, to me that sounds like it's a... Oh, it gets it a healthier, quicker, I mean, you get more weight on and get it to market faster and actually make a higher profit with the feed like that than as opposed to like an alfalfa.

- I think alfalfa's always gonna be great, right?

- Yeah.

- But this certainly could be a staple or a substitute or a nutrient enhancer for that dairy grower or that beef grower that wants to have, obviously added protein in that animal's diet.

And there are studies out there that when incorporated with some cannabinoids, lowers the stress hormones, more resting time, better rate of gain on some of those animals as well.

- So, almost a Wagyu beef.

I mean, they're just calm and- - We're working on it.

Right.

- That's fantastic.

- Yeah.

- [Jay] Okay, so we get to this point.

- Correct.

- How many products are you putting this into here?

And how many products do you have in development?

I mean, what is that kind of cycle like?

'Cause it is not just, you know, like I say, a lot of people considered this, you know, they were afraid of it because it screamed pot or marijuana or cannabis to them where like- - Right.

- Oh, you're either smoking or eating it.

So, but this, there's so many different uses for it- - Sure.

- Product wise.

So, tell us some of your best sellers, some of the stuff you're working on.

And it's not just Butler Hemp Co., I think you also provide services to other retailers also.

So, just tell us about a little bit of the end products.

- Right, no, and thank you for asking that question.

So once it comes here, ultimately that's, we call that CBD distillate or CBD concentrate, right?

And we will use that in formulations from pet treats to tinctures that you would take sublingually, to gummies, topical products that you would rub on potentially sore muscles or achy joints, things like that.

And you also hit on a, we manufacture products for roughly 30 companies across the nation, so.

- Wow.

- Not everything that you see here in our Butler Hemp Co. line of products is everything that we do.

Ultimately, there's some of those companies that don't want all their secrets out, of course.

- Yeah.

- But we take our products that has been grown by one of our contract growers.

We then process it, manufacture it, distill it.

Then, we manufacture Butler Hemp Co. products here.

And ultimately, we have a little bit of everything in this case that you see.

We've got sublingual tinctures both for, you know, to maybe help treat pain or anxiety.

We've got one of our best sellers being our sleep product that helps people get a nice restful night of sleep.

And we've got those facts backed up by some of our smart watches and Cora rings and those things.

It's really amazing what we've seen.

And then, our most recent product release is a Butler Hemp Co. seltzer.

Zero calories, zero sugars with the benefits of the cannabinoids in there to help you relax and you know?

- Non-alcoholic or alcoholic?

- Non-alcoholic.

- That's fantastic.

So, another avenue within, seltzers are huge.

- Yeah.

- I mean, that is a huge market.

- It's a huge market.

- But it'd mostly be going alcoholic.

But with this- - Right.

- You're getting the calming properties, the more relaxing properties as opposed to the, I'm not gonna be able to drive properties.

'Cause on this level, I mean, is it more like a microdose of what you're getting from it?

- Very, much so.

Right.

There's nothing that is intended to be psychoactive or put anybody in a state where they couldn't function normally.

Now, different people do react or have different results from cannabinoids.

So, if you're new to these products, take it easy, take it slow.

Low and slow is what we preach, and then understand how it's gonna affect your body because people's dosages is often different as well.

You may need 50 milligrams or 100 milligrams to feel the desired effect, whereas I'm a notorious lightweight when it comes to cannabinoids.

I may need 15 or 20.

So, we suggest people start slow, start low, try it out, and then custom tailored to the dose that works for them.

- Are doctors getting to where they'll at least talk about this with their patients?

Can someone go in and like, "I'm thinking about CBD."

Are the doctors at least away from the stigmas to where they can, they'll talk to 'em at least and being like, "Oh, don't go near that stuff."

Can someone go in like, you know, "I need help sleeping, I've heard about this, what should I do?"

- Right, right.

And the jury's a little bit still out on that, right?

I would say we're probably 50/50 on most of the physicians out there understanding that there are benefits to cannabinoids.

And some that really don't see it as such.

One of the issues that we have is you're really crossing two paths there.

And one is that doctor may not be, he just may be uneducated about cannabinoids and how they can be beneficial to the human body.

And so, he doesn't feel comfortable in prescribing, if you will, or advising the use of cannabinoids.

Whereas the other side, we've got some doctors, some physicians that very much have embraced that.

We're doing a study right now with a doctor outta Connecticut, and he is actually using cannabinoids before opioids.

That's his shtick.

And one of the things that we see with cannabinoids is they're non-habit forming, they're non-addictive.

And even if taken by accident in very high doses, nobody's gonna die.

You're not going to have that risk of death or overdose with cannabinoids like you do opioids.

And we are really pouring our heart and soul here at Butler Hemp Co, in Kancanna into supporting this study so that it, you know, we can help as many people as possible.

- I wanna talk a little bit more about this, but it's time for another short break.

Stick around.

We'll be right back.

(gentle bright music) Welcome back to "Working Capital."

Okay, Heath, tell me some of the stories of the people who come to you.

What are some of the things that this is trying to help with?

I know they're not passed, we can't make any claims of this.

- Sure.

- You know, I know people who use it for migraines and just other symptoms.

So, what are some of the stories you've heard?

- Yeah, so, you know, we have a robust customer list, I guess, of people that have reached out to us with our Butler Hemp Co. products.

And if we wanna start kind of from the top down, we've got a ton of people that seek relief for anxiety, pain, sleep is huge.

And ultimately, if you get a good night's rest, the health benefits of that alone are- - Helps everything else.

- Right.

- Yeah.

- Are significant.

But ultimately, one of the things that was interesting to me when we started this company.

I didn't realize that I'd be having some of the hard conversations that I did.

And some of those conversations were people that had advanced cancers or Parkinson's, or any type of seizure disorder.

Children with epilepsy, things of that nature.

And like I said, I didn't anticipate when people oftentimes were at the end of their rope that they would find relief in cannabis, and I would oftentimes help them down that path.

But sleep, anxiety, convulsive disorders, and we've had a lot of good luck with Parkinson's patients as well.

- On that note, this is, if you wanna look up a story, just look for this on YouTube, but Charlotte's Web CBD.

This is where I think I first started hearing about CBD, I don't know if you knew the story, but I believe a little girl in Colorado, but she suffered from I think grand mal seizures or bad seizures every day.

- Horrible, but yeah.

- So, they looked for, at that point everything was still THC or everything's THC and medical marijuana.

But they figured out that CBD was such a good thing that they created a strain that was all CBD.

And just the few little drops for this little girl took the seizures from multiple a day to, I think, maybe one or two a week.

So it really was, like I said, there needs to be a lot more testing and all, but it was a miracle for that little girl.

I mean, she has since passed because of her ailments and all.

But if you really wanna see a real success story, check that out.

And there's some other ones like that.

But I'm sure you've had people who have then tried it and come back and have it.

Has it really opened their eyes?

I mean, have you had where they're coming back and thanking you?

- Yeah.

- For these products?

- I actually had a gentleman, we had gone to a trade show and he suffered from Parkinson's disease severely.

And he was walking with a cane and pretty frail.

And he came up to me and we had a long discussion about what cannabinoids, CBD in particular could do for him.

And that was a trade show that we visit twice a year, every six months.

And six months later I had a gentleman walk up to me, he had no cane, he had obviously, he gained a little weight and he said, he goes, "Can I give you a hug?"

And I was joking, I was joking with him.

I said, "Sure, hugs are free," right?

And I gave him a hug and he goes, "You don't recognize me."

He goes, "Because I was 60 pounds lighter, I was walking with a cane."

And these products have alleviated some of the symptoms that he was facing with Parkinson's that he could actually be mobile, feed himself, get rid of some of the tremors.

It absolutely changed his life.

- I like how you said the one doctor was thinking CBD before opioids.

'Cause as you mentioned earlier in the earlier segment, the one thing we do know is you can't overdose from this.

You can't take too much and and die from it.

I mean it, so it is- - Right.

- It is a really, it's kind of a no brainer to start there.

You can always go past it if it's not working, but to try something like this, whether it's your, you have a wrist pain or you do have seizures or some other ailment, it's an easy way in the door to maybe finding some relief.

- Yeah, absolutely.

I mean, ultimately I think there's gonna be a place for both in all things, you know?

You're not gonna break your leg and hope for some CBD, you know?

- Yes.

- Ultimately, at that point, opioid or other- - You're gonna need something a little more.

- Agreed.

But for acute pain or less severe pain, things like that, why don't we start with a near harmless alternative as opposed to something that can be habit forming, and obviously lead to other issues down the road?

Cannabinoids before opioids is that doctor's theory.

And ultimately, he's not a hundred percent in this, but he said, he told us at last update, of course, we've got other data as well, but he can treat up to 50% of his patients that come into his pain clinics with CBD, full spectrum CBD, or even a minor mix of THC, and they're still legal and federally compliant, without having to go to a much stronger drug.

- Wow.

Let's get back to then, then.

Legal compliant THC.

We've seen that pop up in places.

That's a big marketing thing now too.

How does that differ from say, the states like, if you go to Colorado and they're just full-blown recreational and they have a different landscape?

- Yeah, absolutely.

- How how does that evolve here in Kansas?

- So ultimately, hemp is designated as a cannabis plant that contains 0.3% or less THC by dry weight, okay?

But full spectrum products are still legal.

And our threshold for those products is also 0.3%.

So, a small and minor THC component in our full spectrum products is legal.

And what that actually does, THC and CBD both bond to cannabinoid receptors in our body.

And I guess the easiest way of explaining that is, is THC in very minor doses, not psychoactive, not anything that's gonna get you high, but it excites those receptors and allows the CBD molecule to bond more freely.

- Okay.

- So it's, we call it the entourage effect, right?

Full plant botanicals.

The blend of all the cannabinoids from the hemp plant at a federally compliant 0.3 or below taken together, it gives much, much greater relief than maybe just a CBD.

- Okay, so where can we find these products?

- Yeah, so currently Butler Hemp Co. products are distributed through about 300 stores.

- Oh wow.

- All throughout the Midwest.

We've got some product penetration in Southern California, Arizona, Texas, all the way up through Iowa and Illinois.

Ultimately, you can buy them direct from us at butlerhempco.com.

- We'll put that down for everybody.

- Yeah.

Thank you very much.

- And you can go directly to our website and take even a product.

We've got a product quiz on there that may be very helpful for some people that are just starting their CBD journey.

Might lead them in the correct direction on which product to try first.

And ultimately, we hope you find relief.

- That's fantastic.

Well, this is a great business you have going here.

I love seeing all the phases.

I always love when anyone is working with Kansas farmers 'cause you know, we are one of the, if not the best farming state in the United States, so.

- Oh.

Absolutely.

- This is great.

So, thanks for joining us today.

We hope you've enjoyed this highway to hemp and we'll see you next time.

You've been watching "Working Capital."

(soft rhythmic music) (soft upbeat music) - [Narrator] Funding for "Working Capital" is provided by The Friends of KTWU and Go Topeka.

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