Today we have the honor of sharing our interview with Agropro, Europe’s largest producer, processor and supplier of hemp. Thank you to Skirmantas Nikstele for providing us with the story of Agropro!
We are thrilled to speak with you today about your company and its remarkable success. Let’s start with an introduction so our readers can get to know you better. Can you tell us a bit about you and your company?
Agropro started six years ago in Lithuania and we have constantly expanded our output and line of products. Today, we supply a huge range of hemp products across the world.
One of the founding principles of Agropro is to minimize our environmental impact by using the latest technology to farm, harvest and process hemp. We are a certified organic farm and processor, run on sustainable energy.
It was our focus on sustainably and efficiently producing mass market products that led to Agropro being acquired by Canadian medical cannabis powerhouse Aurora Cannabis (NYSE: ACB).
What experiences, of elements of your backstory, helped to motivate or inspire you in your endeavor to start your business?
I’ve always had a love of nature and the countryside. However, somewhere along the line I became a lawyer. When I noticed how the global perception and regulatory environment around hemp and CBD products was changing I decided to make the leap and founded Agropro with my own savings. The timing was perfect, we got up and running just before the law in Lithuania changed. Thanks to a joint venture with a large farming operator, we built a 107 hectare hemp farm. We didn’t look back from there.
I imagine it takes an enormous amount of effort to build a “hemp-empire”. Can you shed light on some of the obstacles you encountered as you grew and scaled your business and how you navigate those successfully?
Any farmer will tell you that it’s a tough job. There is so much out of your control and so much that can go wrong – the weather being a simple example. Add to this, the fact that hemp used to be a bit of an unknown quantity for our perspective customers and there were plenty of hurdles to overcome when we started out. Educating people on the benefits and versatility of hemp and its products was a huge part of our initial work. By partnering with like minded individuals and companies we were able to quickly build up a whole supply chain network – something a lot of producers struggle with. We focused on using the latest technology to grow, manage, harvest and process our hemp, which meant we were able to reduce cost and mitigate risk. Obviously, we had our fair share of good luck – all businesses need that – but the real key to our success was assembling a great and hardworking team. It is their dedication that has made us what we are now.
Take us through the process of designing, prototyping, and manufacturing your first product. What did that look like?
The first product we tried to produce is also our biggest lesson learned. We dedicated 80% of our first hemp seed harvest to produce hulled hemp seeds – now the best selling hemp food produce. Our mistake was to trust old-school dehulling operators from the buckwheat industry to do the job. It was only after we got our ‘product’ back we learned that it would not be competitive in the market due to the percentage of crushed hemp seeds and various impurities caused by the old process. Hemp is a new, niche crop, and so we had to forget about conventional and ‘easy’ processing methods because we could see it wasn’t working. To reach perfection, you have to control all parts of the manufacturing process, and the easiest way to do this is by using the latest technology. There are no easy solutions in hemp.
What makes your brand or product unique in this emerging industry of CBD?
We’ve really focused on hemp oil and hemp seeds. I’m a strong believer in the nutritional and wider health benefits of hemp. The positive properties of hemp are affirmed by an array of independent scientific research, which is not necessarily the case yet for a lot of CBD products that are now on the market. Combining this no-nonsense approach to marketing our products alongside the ethical and green way we produce our hemp makes us stand out. We use rigorous testing and monitoring of our farms to ensure consistent high quality produce . When people buy from us, they know they are always going to get the best hemp available. But mostly, we are different because of how safe our products are. This we achieve from two angles; all of our raw materials are certified organic, meaning they are free from anytype of chemical residues, and we are one of just two hemp processors fully certified under the BRC food safety system. BRC is the highest standard one can achieve.
Have you ever felt like you had to come up against any stigma around CBD? If so, how were you able to address that?
It’s pretty common that when new products come on to the market there is first suspicion, then a great deal of hype, before finally consumers and businesses get to grips with what the product can and can’t do, and everything settles down.
“We are getting past the ‘suspicion’ stage of CBD thanks to cultural and legal changes across the world. But that means we are now hitting a point where there are more and more CBD products on the market claiming to cure and help all kinds of things. Undoubtedly, this hype will die down relatively quickly and CBD will be treated no differently from other natural health products on the market. When we started out the challenge was differentiating between hemp, CBD and cannabis. However, people are generally quite smart and with a little education on THC, any concerns were quickly dispelled.
In terms of the market for your product, what would you say is your target demographic?
The appeal of hemp oil and seeds is pretty universal. Obviously, the health conscious 20-something is one of our key buyers, but I don’t see why we can’t appeal to anyone who wants to lead a healthier lifestyle. Attitudes change very quickly – people are much more open to new experiences and trying new products. I think hemp and CBD products will rapidly have complete mainstream appeal.
What do you do to attract and retain customers?
The consistency and quality of our product is key. We invest a lot of time and resources on the cultivation and processing of our hemp. There is a rigorous quality control process, all of this is underpinned by the very latest technology. We want our customers to know when they buy from us they are consistently getting the best product on the market. And in our case, size matters. Our customers know that we will be able to supply hemp products throughout the year on time and at whatever capacity requested. There are plenty of competitors who, for example, run out of certified organic hemp material within six months of their hemp harvest.
9. Have there been any helpful resources, tools, or platforms that you’ve relied on to get your business off the ground and keep it running smoothly?
I used my own savings to get started, however, I would not have gotten far without quickly partnering with other businesses. It goes without saying, that the best resource any entrepreneur has is their family and friends.
And right now, after selling Agropro to a Canadian Licensed Producer Aurora Cannabis (NYSE: ACB), I am proud to say that their help and resources we are about to change the face of Agropro. We are going to get to another level of business efficiency, speed and scope.
10. What has the general reception of your product been, in terms of the feedback you receive most frequently from consumers?
We provide a large range of products, but what unites the first reaction of our customers is surprise that our claims are backed up with reality. For example, hemp seeds are a really tasty and nutritious food, however, as they say the proof of the pudding is in the eating!
As a follow up to that last question, can you tell us about some of your best-selling products and the benefits they provide?
One of our most demanded food products right now is hemp seed oil. One of the reasons for this demand is that hemp seed oil is often used as a base oil in CBD tinctures and sprays. But there is something that consumers still mostly miss; it has a nearly perfect Omega 3 to 6 ratio (3:1). Consumers get plenty of Omega 6 from eating meat or seeds, but our diets often lack Omega 3. Hemp seed oil is a perfect source of this essential ingredient. Did I mentioned it is certified organic and plant based?
Are your products third party lab tested by batch? If so, are you willing to attach and share your lab results?
Certainly. Each batch is tested three times; right after harvest, to make sure we are not accepting any off-chart raw material to our facilities; after seeds / biomass are dried and cleaned, to make sure we ourselves did not contaminate the seeds / biomass while preparing it for further processing; after processing, to make sure no contamination is present and products meet stringent specifications. All of this is done at an accredited third party laboratory,and all samples are kept forever in our sample vault. We are proud to say that the largest and most respected European food safety laboratory in Germany provides us with a dedicated specialist just to handle our quality control requests.
Alongside these external tests, we test each batch while it is still in production, taking flow samples every 1-2 hours,testing various parameters in-house.
We all know that the political environment and legal regulation on hemp is ever-evolving and often somewhat ambiguous. How do you navigate those regulations and how do they impact your business?
Agropro was born out of anticipating the legislative changes in Lithuania and getting a first mover advantage. This lesson has never been forgotten so we are constantly keeping an eye on the legal environment right across the world. A key part of this is monitoring how the media are portraying hemp. If it is getting increasingly positive we know that it is only a matter of time before politicians feel they have the cover they need to liberalise regulations. It is also important to team up with like minded businesses in the industry to both help advise on how regulations work and educate stakeholders such as politicians on the realities of hemp production. This is why I helped found the Fiber Crop Farmers Association – which is dedicated to hemp growers – and I represent Lithuania on IFOAM EU (the EU umbrella organization for organic food and farming advocates).
Since being acquired by Aurora, their dedicated Regulatory Affairs team works day and night to help us navigate stormy waters in the legal environment.
In terms of advice, what would you say to someone who was wanting to break into the burgeoning CBD industry?
Pick a specific niche and do it better than anyone else. There will be no substitute for hard work and passion. So do not get involved just because it is trendy, do it because you think you can make a real difference and create something that people want.
What do you think is the key to staying relevant and becoming successful in one of the most competitive industries?
Keeping your standards up and listening to your customers. They are an invaluable source of market intelligence. By constantly getting feedback you can predict new trends, refine your products and react to the movements of competitors. Maintaining high standards will ensure your customers stay loyal.
What do you foresee in the future for the landscape of CBD-related products and services?
That really is a million – or billion – dollar question. Broadly, I think we’re going to see the global regulatory landscape continue to liberalise. As I’ve said before, we are in the hype stage of CBD – everyone is coming with new ideas and consumers are getting increasingly excited. This is going to die down eventually and the industry in mature markets like the US and Europe are going to see a period of readjustment. This may see a reduction in the variety of products using CBD or, depending on how government regulation and scientific evidence evolves, we may see a boom in a completely new strand of CBD-product that is not yet on the market.
So, what are some of the exciting next steps for your company? What does the future look like for your business?
Each year we increase the amount of land we have under cultivation – breaking new ground in new places is always incredibly exciting. I can’t say too much about the new products we might bring out, but I think it’s safe to say we’re always looking to surprise and delight our customers. Watch this space!
