ECS Botanics Is Planning to Upend The Australian Cannabis Landscape

ECS Botanics (ASX:ECS) is an Australia based cultivator and producer of hemp and hemp-based food products, with plans to disrupt the Australian medicinal cannabis industry.

Founded in Tasmania in 2018 by Alex Keach, ECS Botanics (ASX:ECS) was born out of Mr. Keach's agricultural expertise, and his interest in the plentiful benefits of hemp plants, such as the omega provided by hemp foods, and the durability of hemp fabrics. In recognizing these virtually untouched benefits – due to the fact that hemp was only legalized as a food source in 2017 in Australia – ECS Botanics positioned itself as an early-mover in the space.

Within a year, ECS had obtained the full set of licenses needed to cultivate, supply, and manufacture industrial hemp in Tasmania, and by the end of 2019, ECS had also been given a growers license in Queensland, along with import and export licenses from the Australian Office of Drug Control (ODC).

Additionally, in 2019, ECS snagged a distribution deal with Woolworths that would see ECS's hemp-food products stocked in over 850 Woolworths stores, including its hemp seed oil and hemp soup ranges.

And finally, most recently, ECS Botanics (ASX:ECS) announced its plans last week to become a first-mover in developing an outdoor medicinal cannabis project at its wholly-owned site in northern Tasmania. According to the 3 phase Project, ECS Botanics may soon be producing more cannabis than its competitors, while at a lower cost per gram.

ECS is quickly positioning itself as a major player in the Australian Cannabis Landscape, so let's take a closer look at what they're all about.

Hemp Food Phenomenon

In 2018, Australia sold approximately $41 million in hemp-based products, two-thirds of which was cultivated in Tasmania, where ECS is located. This is no accident, argues Mr. Keach, who has a background in farming in Tasmania and points to the agricultural strengths of Tassie:

"From a climate point, [Tasmania has] a cool climate but warm long summer days which are perfect for producing hemp seed and a consistent and concentrated profile of secondary metabolites.  Tasmania also has an abundance of water supply, the state has a moratorium on genetically modified crops, some of the cleanest air in the world, plus has a clean, green image which is recognised globally."

Tassie is undoubtedly the best place to grow hemp in Australia, if not the world.Alex Keach, Founder of ECS Botanics

And not only is Tasmania the perfect place to grow crops but hemp, in many ways, is also the perfect food source.

Hemp seed oil is rich in polyunsaturated fatty acids (PUFAs), as well as two essential fatty acids (EFAs) linoleic acid and alpha-linolenic acid. Additionally, the ratio of omega-6 to omega-3 in hemp seed oil is normally between 2:1 and 3:1, which is considered to be optimal for human health. One tablespoon of hemp seed oil provides more than the daily EFA requirements suggested by the FDA.

Hemp seed contains approximately 25 grams of protein per 100 grams, comparable to most meat and fish. Hemp seed is an easily digestible protein and is also a 'complete protein source' as it contains all nine essential amino acids which the body cannot manufacture itself and needs from food.

With hemp being one of the most complete food sources on the planet and absorbing more carbon than any other commercial crop, hemp will be an important contributor to solving the issues such as climate change and making sure the battle to keep protein up to worlds expanding appetite for protein.  Furthermore, with demand for plant-based protein being lead by veganism, a disease linked to meat protein and companies developing plant-based meat products, the industry is poised for rapid growth

ECS Botanics recognizes all of these benefits and its business wholesales raw hemp food ingredients and retails products such as protein powder, shelled hemp seeds, hemp seed oi bottles, hemp seed oil capsules and soups.

Low-Cost Cannabis

ECS's plans to develop an outdoor medicinal cannabis operation could set the company apart from the rest, by lowering operating costs while producing higher amounts of cannabis. As we've stated previously, the high cost of cannabinoid medicines is one of the biggest barriers to their prescription, and by producing lower-cost raw materials, ECS could position itself as a key player in Australia's medicinal landscape.

By Stage 3 of the project, ECS will be growing 32,500 kg of dry flower, while costing the company only $3M to complete. Other ASX-listed cannabis companies are spending upwards of $70M to achieve that same yield.

You also have the fact that hemp crops can be used to produce low-THC CBD, which provides a host of medicinal benefits such as alleviating chronic pain, anxiety and epilepsy symptoms – all without getting intoxicated.

The first phase of ECS's 3-phase project will see the company producing plants that are rich in CBD, which may coincide with the Australian Government's plans to relax the scheduling of CBD medicines and make them available over-the-counter.

As the demand for plant-based protein and nutrient-dense foods grows, alongside the growing interest in cannabinoid and CBD medicines, ECS will be capitalizing on every corner of the cannabis market.

We are in the midst of a huge consumer shift toward using botanical extracts, including cannabis, for nutrition, medicine, supplements, cosmetics, flavouring, sanitiser and cleaning applications and we are seeing strong growth in both the cannabis extract market as well as essential oils, which is an US$8 billion market. Cannabis is no longer viewed as a 'one trick pony', containing an abundance and array of cannabinoids, essential oils, terpenes and flavonoids. Alex Keach, Founder of ECS Botanics

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Louis O'Neill
Louis O'Neill

Louis is a writer based in Sydney with a focus on social and political issues. Having interviewed local politicians and entrepreneurs, Louis now focuses on cannabis culture, legislation & reform.

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