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Crop Infrastructure looking to control supply chain in California

Last updated: 16:48 07 Nov 2018 GMT, First published: 15:33 07 Nov 2018 GMT

Marijuana plants at farm
Crop is working to increase marijuana production efficiencies and return on investment

Crop Infrastructure Corp (CSE:CROP, OTCMKTS:CRXPF) said Wednesday it is working to have complete control of its California supply chain.

The Vancouver-based company said in a press release processing continues at its farm in Humboldt County, California, and new automation equipment has arrived to increase efficiencies and continually increase return on investment.

Crop added that its Emerald Heights retail brand just completed the stage three interview process with the city of San Bernardino – a major hurdle before the final licensing review to open its first Californiaretail brand location.

READ: Crop Infrastructure tenant in Nevada completes harvest of cannabidiol hemp

The company is also going through the process of opening two Emerald Heights locations in Italy and one in Nevada.

“The significance of fully vertically integrating cannot be understated, and we are working towards that end as rapidly as is practicable,” Crop CEO Michael Yorke said in a statement.

Crop said a tenant is accepting and reviewing bids from distributors to handle production under the Hempire, Evolution and White Rhino brands. The tenant has applied for its own distribution license to represent its own production and the production of other producers.

Tenants are preparing an extraction license application for the Humboldt farm to maximize ROI and broaden the range of SKUs (stock keeping units) available to retail locations.

Plans submitted to boost output

Crop added that it has submitted plans to the Humboldt County, California, building and planning department to increase production of the California facility at a cost of $1 million. Of that amount, $250,000 has already been spent, according to the company.

The boost in output is projected by the company to result in an additional 12,000 pounds of high-quality cannabis and 3,000 pounds of secondary material per year.

The company's portfolio of projects includes cultivation properties in California, two in Washington State, a 1,000-acre Nevada cannabis farm, participation in West Hollywood and San Bernardino dispensaries and an international focus in Jamaica as well as Italy.

“With extraction and retail verticals now in process, the opportunity to maximize ROI on a significant scale presents the opportunity to control Crop's tenant destiny and maximize future profits," Yorke said.

Crop’s shares edged up $0.01 to $0.39 in Canadian Securities Exchange trading on Wednesday.