China's Shunho to Get Into Industrial Hemp Business in North America
Tang Shihua
/SOURCE : yicai
China's Shunho to Get Into Industrial Hemp Business in North America

(Yicai Global) Jan. 20 -- A  Hong Kong unit of Chinese packaging materials firm Shunho New Materials  Technology will make inroads into industrial hemp business in North America after it secured a permit to plant the versatile crop on its home turf. 

Lvxin Packaging Resources Holdings will establish an affiliate in the US with a registered capital of USD4 million, the Shanghai-based parent said in a statement  yesterday. The rationale may be to sell the fruit of Shunho's unit  Yunnan Luxin Biological Pharmaceutical which secured a related planting  license in southwestern Yunnan province in mid-January.

The 2018 Farm Bill, that  the US Congress passed last December, removed hemp that contains less  than 0.3 percent of tetrahydrocannabinol from the Controlled Substances List, which has essentially made the less intoxicating  variety of the plant legal. It may be used for dietary supplements, paper, cosmetics and cattle feed.

Shunho's stock price [SHE: 002565] rose by the daily limit of 10 percent today to CNY12.72 (USD1.90). Its equity has been aspirational since the planting permit  came through.

The global industrial  value of cannabidiol will reach USD5.7 billion this year and USD18.1 billion in 2021, according to US market research firm Brightfield Group's estimate. CBD is a cannabis-derived compound that can be  extracted from hemp and used to medicate anxiety, pain, and movement disorders. 

Editor: Emmi Laine 

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Keywords: US Subsidiary , Industrial Hemp , R&D , Shunho , CBD , Cannabis Stocks , Lvxin Packaging Resources Holdings