The true CBD sector of Colombia
Colombia is considered to be the next hemp or CBD hub of the world due to its geographical location (between Asia, Europe and North America), biodiversity/different climates and low investment/operation costs. All of these characteristics are true, and we definitely believe in the opportunities that Colombia has, however, the reality of the past 2 years has shown something different.
Consultants, lawyers and investments in long-term assets are frequently overvalued due to lack of knowledge from foreign investors that are taken advantage of. Besides, prices seem to rise automatically when the hemp industry is involved. In addition, high returns are promised based on old numbers. This is not always the case, but there is a tendency that these things happen.
Many companies focused on buying as much land as possible but forgot to focus on investing in high tech extraction laboratories to transform the hemp in actual products. Besides, certification of the production chain and product is a focus point that needs to be taken into consideration to be able to export products to the US or Europe.
We know several ‘big’ companies that pretend to have it all, but are not able to provide quality products with good pricing or are not able to provide anything at all even though their marketing machine is running at a 100% and spreading positive news on exports and growth only.
The US and European CBD market has exploded in growth and imploded in price over the last few months, especially in the United States where high quality products are now available at very low prices. Now that a few companies obtained a GO from the Colombian government, it is time to pay back the investment costs and start to make a profit. Problem here is that there is almost no product available due to lack of technology. When the product is available, it is 2 or 3 times more expensive compared to the US.
As a result, companies have been investing millions of dollars in land, services and marketing, but not in creating a well organised company with high quality and competitive products and long-term ambitions. We think that several of these companies will get in trouble sooner or later.
We want to change this because we see and understand the real opportunity on the long-term for the country and its actors rather than just an opportunity to make a quick buck. Therefore we have studied the market for over a year regarding real costs, activities, time and key actors to get a good indication of what and how to take advantage of the potential.
Nvest provides an offline platform to our clients and partners that have interest in starting operations in Colombia. As a result, we have access to all key actors in Colombia regarding to:
– Farmers and operators that are willing to both invest and participate actively
– Long-term assets such as land and laboratories
– Knowledge, experience and technologies from our US partners
– Seed varieties
– Certification companies
– Local finance possibilities, if it’s necessary
In addition, we can plan and execute the project where we focus on obtaining licenses, implementing the foreseen goals and activities, and become a long-term local partner in managing the project to make sure that the objectives are getting achieved.
The road to success in Colombia is not an easy one due to long waiting periods for the licenses, and finding the right people to start these projects with. However, it is definitely possible to successfully start a hemp business in Colombia and we believe 100% in the potential if it’s implemented correctly.
At the moment, Nvest is sourcing CBD products from the US to Europe due to it’s good quality/price ratio. In addition, we are in talks with several companies that showed interest to expand to Colombia. We hope to be able to source high quality and good priced CBD from Colombia soon and we participate in this process where we can.
Do you have any questions regarding the Colombian or United States hemp or CBD sector?
Please get in touch with us and we will be more than happy to help you!