Greenfern Industries has secured a lucrative export deal that could be worth more than NZD$1.6m.
The initial two-year agreement is an offtake order for the purchase of Greenfern’s Taranaki-grown medicinal cannabis.
An offtake agreement is a binding contract that formalises the buyer’s intention to purchase a certain amount of the producer’s future output.
Managing director Dan Casey said the cannabis will be for use in an overseas medicinal market and, depending on which chemotypes are supplied, could be worth in excess of NZD1.6 million over the contract's duration.
This comes just days after Greenfern’s previous market announcement that it had received the globally recognised Good Agriculture and Collection Practices (GACP) certification via global certifying body Control Union Medicinal Cannabis Standards (CUMCS).
“This is another great milestone for Greenfern and our shareholders. As we go from strength to strength in what is very much a sunrise industry here in New Zealand, the progress that we are achieving is a testament to the solid foundations we have laid to date,” Casey said.
As the company looks to raise new capital in the second half of 2022, its phase one cultivation facility will be utilised until the larger phase two facility comes online.
“It’s quite a strategy to not get too far ahead of ourselves by over capitalising on infrastructure before the markets are ready and the regulations are met, but at the same time we don’t want to miss opportunities as they present themselves. It’s a real balancing act.”
Casey said the company was currently preparing a medicinal cannabis consignment for testing to meet New Zealand minimum quality standards. Once that is completed, the first batch will be ready for shipment.
This latest agreement shows a clear path to revenue for Greenfern’s cultivation business and from this the company will scale accordingly to meet overseas demand.
Greenfern’s Australian business, GFI Pharma, continues to acquire patients month on month through prescription medicine tincture sales. That, together with its hydroelectric power station in full swing with winter energy demands, the company is solidifying itself as a progressive and diverse cannabis company.