the number of cannabis extraction companies grows as a significant sector in the cannabis industry. This extraction market is growing even faster than the rest of the industry due to the fact that cannabis-based medicine is driving both current and future market growth.
With the growth in demand for products created with cannabis extraction more pharmaceutical companies are coming into the marketplace. Many are moving into CBD extraction rather than working with the dried flower to get the raw material that is required to make their various products.
Along with the pharmaceutical market, the oil segment is growing as well. States that allow both medical and recreational use of marijuana, such as Colorado and Washington, see cannabis extracts as almost half of the market share. It is numbered such as these that are boosting interest from pot stock investors as they begin to focus on cannabis extraction over the traditional marijuana businesses. Many cannabis extraction companies have formulated business plans that give them consistent cash flow reducing investor risk and market volatility. They can offer higher price points than plant-based companies.
Top Cannabis Extraction Companies
This company is a Canadian Licensed Producer started in 2015. Their focus is on purified cannabis oil and concentrates that is pharma-grade quality. These products are then used to make extracts and various cannabis-based products.
The company owns its 70, 000 square foot facility in Barrie, Ontario that has top of the line technology and equipment to do cannabis extraction, fractionation and distillation.
It was targeted to be a top performer in 2020 and has done just that. They are now the largest extraction producer in the industry with an annual extraction capacity of 300, 000 kg per year. This will increase to 500, 000 kg when their new extraction line is up a going.
MediPharm has also expanded its business beyond extraction with its White Label Production. This division is similar to pharmaceutical manufacturing done under contract. They do the research, creation, production and packaging for other third-party clients. This added revenue stream has boosted sales and profit.
In addition to White label and extractions, they also own the Australian subsidiary MediPharm Labs. They have a cannabis manufacturing licence there as of 2019 and are one of the early leaders in the cannabis market down under. They are currently building a 10, 000 square foot building to do supercritical C02 extraction with the processing ability to do 75,000kg annually. They will also be able to produce purified and high concentrate distillates. This Australian arm will strengthen the MediPharm supply chain.
MediPharm profits grew through 2020 and should continue to do so throughout 2021 even with the slow down of the markets as they have lots of working capital, unused credit and other cash options to hold them if times slow somewhat.
Now known as The Valens Company, this business is one of the biggest extraction companies in the market. It is a huge player in the market that has agreements in place with some of the key cannabis companies in the world. Their stock has climbed steadily with profits exceeding expectations.
Valens can offer services that include C02, ethanol, hydrocarbon and terpene extraction methods along with analytical testing and white label product work. It is perfect for outside companies who want to create edibles or extract products. In addition to these services, Valens also uses centrifugal partition chromatography and emulsion technology to help research and develop new products. This continued versatility and agility mean they can target a wider swath of the cannabis market.
Neptune is one of the cannabis extraction companies that is based in both the US and Canada. Their business focus is on extraction, purification and the creation of cannabis products. They offer high-quality broad-spectrum health products. They are based in Quebec Canada and North Carolina in the US with over 75,000 square feet of facilities combined. These facilities have an annual extraction capacity of over 3,000,000 kg.
Neptune has a strong client listing that includes a major farming service in the US for which it will be processing crude oil extracts from raw hemp biomass. This contract is higher than $20 million in value allowing Neptune to have a steady income for the next 2 years.
The demand for extraction and formulation services, especially in the United States, is strong and Neptune’s ability to ride the wave of product demand is high. Their diversification strategy is well thought out. The added strength in Neptune is its division called Neptune Ventures which works with technology and strategic investment. The hope is this division will push for innovation and partners in the cannabis and wellness areas. Innovation is important as it has the potential to create products increasing future sales.
The cannabis extraction companies are a part of a sector that is doing exceptionally well even in times of global trial such as the Coronavirus Pandemic. The demand for products in the area of cannabis extraction is going to experience continued growth and expansion with both recreational and medicinal requirements growing around the world. Cannabis is no longer a product relegated to the back rooms of the black market. It has become mainstream and is here to stay. There are many great business and investing opportunities.
The companies who are latching on to this market and working to offer a variety of products with different forms, dosages, composition and ways of consuming are going to keep growing if it is done correctly. A well-run cannabis extraction company is going to allow for premium prices and larger margins for good profits and positive cash flow. 2021 is going to be a good year for the extraction market and its players. With legalization in Canada and more states coming on board, these companies have established early on that they can make good money and be a great investment for those who want to get into the cannabis market early.