KANSAS CITY— Grain-based foods companies interested in the expanding hemp market should take heed. Seeds and CBD (cannabidiol) are two parts of the plant that may present marketing opportunities, but flavor issues need addressing.
Products containing CBD, which people take for perceived benefits like anti-inflammation properties and reduced anxiety, may face regulatory issues. The Food and Drug Administration has not approved CBD for use in foods, beverages or dietary supplements.
Hemp and marijuana both are forms of Canabis sativa L. A plant that contains more than 0.3% tetrahydrocannabinol (THC) is classified as marijuana. Hemp must contain less than 0.3%.
FONA International, Geneva, Ill., cited information from New Frontier Data showing US consumers are expected in 2020 to spend nearly $3 billion on cannabis-infused products, which would include both products with hemp and those with marijuana. Meanwhile, New York-based Nielsen in December 2019 projected the US hemp-based CBD market to grow to a $2.25 billion to $2.75 billion industry in 2020 (still a fraction of the $70 bilion-plus combined size of the medical, legal recreational and illicit cannabis market).
Supply has risen. Licensed hemp acreage in the United States rose to 499,362 acres in 2019 from 78,176 acres in 2018, 25,713 in 2017 and 9,770 in 2016, said Beau Whitney, founder of Whitney Economics, Portland, Ore., and an economist for the National Industrial Hemp Council, Washington. He is working on research comparing the revenue and nutritional value per acre of hemp to that of corn and soy.
Whitney Economics estimated the US market for foods containing hemp at $175 million in 2019 and forecast the market to grow to $200 million in 2020 and then reach $375 million by 2025.
“One of the reasons that hemp has really resonated in the food industry is that it is considered a superfood,” Mr. Whitney said, adding it is high in plant-based protein.
‘A hidden jewel’
Hemp seed is a “hidden jewel” in the baking industry, said Brian Zapp, creative director for Applied Food Sciences, Austin, Texas. Once it is pressed or extracted, it materializes into two ingredients.
“One is a nutritional oil loaded with omega-3 ALA fatty acids, and the other is a protein with all nine essential amino acids, healthy fats and mineral content,” Mr. Zapp said. “Both of these offerings can be hugely beneficial for baked goods. For AFS, the process goes one step further in that we dehull the outer shell to deliver an oil and protein ingredient from just the hemp hearts. The removal of the shell presents a much cleaner ingredient that is white, instead of green, and is void of bitter, pungent flavor typically associated with hemp seeds.”
Applied Food Sciences has partnered with Victory Hemp Foods, Carrollton, Ky., to bring the plant-based protein ingredients to the natural products industry.
“Victory has demonstrated a deep commitment and expertise in working with hemp seeds, while AFS has over 20 years of experience in developing functional food ingredients,” Mr. Zapp said.
Interest in CBD
CBD has become a well-known hemp extract. Forty-three percent of US consumers either have tried or are interested in trying food and drinks that contain CBD as a functional ingredient, according to a survey from FONA International. Reasons for consuming CBD include pain relief, anti-inflammatory activity, anxiety reduction and beauty enhancement.
“Granolas, snacks and cereals that utilize an oil such as sunflower or canola in their ingredient mixture are perfect delivery vehicles for CBD and other hemp cannabinoids,” said Tara Froemming, marketing specialist for Healthy Food Ingredients, Fargo, ND. “As an oil-based ingredient, CBD can be easily blended with the carrier oil and accurately dosed for inclusion in the product.”
Since it is an oil-based ingredient, CBD’s texture is mostly smooth and creamy.
“Taste, however, can be another issue, especially when dealing with full or broad spectrum distillates, which will contain some level of terpenes,” Ms. Froemming said. “We have been able to overcome these issues with a very exacting extraction process that enables us to keep the percentage of terpenes extremely low while still ensuring the ingredients meet the requirements to be labeled as full or broad spectrum. A CBD isolate delivering 99.5% or more CBD would have minimal to no taste impact since all of the terpenes have been removed.”
HFI this year entered a supply partnership with KND Labs, a producer of domestic hemp-derived cannabinoids such as CBD, CBG (cannabigerol) and CBN (cannabinol). KND operates facilities in Lakewood, Colo., and Arvada, Colo. The partnership offers extraction, third-party testing and grower-direct supply assurance to the food, beverage, pet, nutraceutical and cosmeceutical industries.
“CBG and CBN are two additional hemp cannabinoids that are starting to create a buzz in the industry,” Ms. Froemming said. “Like CBD, they too are oil-based, making it easy to blend them with another carrier oil for easy inclusion in virtually any grain-based product that includes an oil in its ingredient blend.
“CBG and CBN are typically provided as isolates or high percentage distillates, which means they contain little to no levels of other cannabinoids or terpenes. This helps ensure they have a cleaner taste profile making it easy for product formulators to use in a wide variety of grain-based food applications.”
Fuller hemp extracts and CBD oils that have not been distilled contain minor cannabinoids in addition to terpenes, said Collette Kakuk, vice president of global marketing for HempRise, Jeffersonville, Ind., a business of Layn Corp.
“Terpenes have a robust earthy, sometimes musky natural taste and smell,” Ms. Kakuk said. “Keeping the terpenes instead of removing them for what is often referred to as ‘pure CBD’ or ‘CBD isolate’ is increasingly desired by consumers as they are looking for whole plant benefits to receive what is known as an ‘entourage effect.’ While some consumers and brands desire this taste profile, others do not, and we apply a variety of complementary botanical solutions to assist in creating desirable taste profiles.”
HempRise suggests companies monitor storage and baking duration and time, which will prevent the destruction of cannabinoid and terpene profiles.
“Hemp extracts and CBD oil are fat-soluble, making them desirable and appropriate to use in any recipes calling for fats,” Ms. Kakuk said. “Consumers are increasingly desiring a variety of consumption formats with which they are familiar, showing keen interest in edibles, including brownies, cakes, bread, cookies and bars in single packaged servings.”
Viobin LLC, a business of Denver-based PHM Brands, offers CBD oils, CBD isolates and CBD lotions. Founded in 1936, Viobin has a long history in the oil extraction business. PHM Brands also owns Panhandle Milling, which is working on ways to incorporate CBD into baked foods.
Viobin already uses CBD raw materials (crude, distillate or isolate) in finished CBD products such as tinctures, topicals and softgels, said Tim Devey, marketing director for PHM Brands.
Hemp Synergistics, Leetsdale, Pa., offers a CBD cake mix that provides an ingredient at 20% CBD content by weight.
“CBD bake mix from Hemp Synergistics was designed to mimic traditional baking ingredients,” said Dan Kohler, chief executive officer. “CBD bake mix has the mesh size of flour and the moisture content of sugar. CBD bake mix is a dry, free-flowing powder that is formulated to be minimal in volume, resulting in no modification to existing recipes.”
Applied Food Sciences has a self-affirmed Generally Recognized As Safe (GRAS) status for its CBD-based extracts. AFS limits CBD use in food and beverages to basically certain beverages, bars, candies and smaller confectioneries, Mr. Zapp said.
“This is similar in pretty much every self-affirmed GRAS position that we have observed for the category,” he said. “So while not impossible, trying to incorporate CBD in your typical bread or cereal products would not fit the intended uses and therefore, would take on added challenges in bringing the product to market from a regulatory standpoint.”
CBD in almost any crude form is pungent, bitter and has a strong hemp flavor, he said.
“In our experience, we have seen this approached in two ways: those who embrace it and those who do everything they can to mask it,” Mr. Zapp said. “The reality is that because hemp tends to be the featured ingredient with a familiar smell and taste, it makes sense that the consumer should be able to notice that it is there. Some consumers even go so far as to believe that ‘if it tastes gross, it must be working.’ But we all know that there is a threshold that hemp can cross quickly to where it becomes virtually unpalatable.”
Certain nano-emulsion technologies or micro-encapsulation allow hemp to work in products without impacting the sensory experience, but consumers may be skeptical if the hemp is not detectable.
“Additionally, micro-encapsulation adds cost and will often add ingredients to the label that can disrupt the clean label approach,” Mr. Zapp said. “In our experience, the brands that are succeeding in this space use minor flavor-masking agents or naturally occurring emulsifiers to help tone down the flavor without completely removing it.”
Legal issues come with CBD
Regulatory questions may have food companies hesitant to enter the hemp category. One main question: May a company legally incorporate cannabidiol (CBD) in a food product? Another: How can one be sure the amount of tetrahydrocannabinol (THC) in the product containing hemp is under the legal limit?
Ultimately, we as an industry in order to be successful in this space, we’re going to have to have data, hard data, toxicological data, clinical data demonstrating why it is this ingredient is safe and be able to address these concerns that FDA has raised. — Martin Hahn, Hogan Lovell US LLP
Since CBD is approved for use in a drug called Epidiolex, the US Food and Drug Administration has ruled CBD may not be used legally in foods, beverages and dietary supplements. Yet promotions for CBD-containing products are seen throughout the country.
“The legal terminology is, this area is stinking complicated,” said Martin Hahn, a partner for Hogan Lovell US LLP, Washington, in a presentation at ShIFT20, the Institute of Food Technologists’ virtual meeting in July.
The FDA has posted safety concerns, including how CBD affects the liver and the kidney as well as how it reacts with other drugs. A study published online July 7 in Medical Cannabis and Cannabinoids said cannabinoid use potentially could impact 57 prescription medications. The study involved researchers from Penn State College of Medicine in Hershey, Pa.
“Ultimately, we as an industry in order to be successful in this space, we’re going to have to have data, hard data, toxicological data, clinical data demonstrating why it is this ingredient is safe and be able to address these concerns that FDA has raised,” Mr. Hahn said. “Without that data, we’re going to continue to have a great deal of uncertainty because you certainly can’t expect a regulatory agency like FDA to issue a regulation authorizing marketing of CBD when they continue to have safety concerns with it.”
So far the FDA has issued warning letters only to companies that claim their CBD products are effective against diseases like cancer and COVID-19, he said. States also may have their own CBD laws, he added.
Kathy Musa-Veloso, PhD, senior director, health claims and clinical trials, for Intertek Health Sciences, Inc., also spoke at ShIFT20. She cited a study from Wheeler et al 2020 showing 63% of respondents said they strongly agreed that CBD products are legal to use and another 21% said they somewhat agreed.
“The reality is there are millions of Americans every day that are relying on CBD for various reasons,” Mr. Hahn said. “A lot of them are using it for pain management. A lot of people want to have access to these products. They are widely available even though FDA continues to say these products cannot be marketed lawfully as a food or dietary supplement. It’s hard to walk down any street, city block or even in rural America without seeing a store that is advertising CBD.”
Companies entering the CBD category need to know the law, Mr. Hahn said.
“My best guess is we’re going to see a lot of confusion, a lot of craziness over the next several years, but I do believe this market is going to be here,” he said. “I’m optimistic that five years from now, there will be a little better clarity.”
Getting below 0.3%
Both marijuana and hemp are Cannabis sativa L. Any cannabis plant that is more than 0.3% THC legally is considered marijuana. Hemp contains less than 0.3% THC. Mr. Hahn said hemp-derived ingredients include full spectrum oil, which includes all the cannabinoids in the plant, broad spectrum hemp oil, which removes part of the plant (typically THC), and the seed, which is not part of the marijuana definition. Food companies thus will need to work with hemp ingredient suppliers that can verify their hemp is under 0.3% THC.
“We provide third-party test results showing that THC levels are less than 0.3%, which are the benchmark most customers look at to help ensure the hemp ingredients they are buying are compliant with current federal regulations,” said Tara Froemming, marketing director for Healthy Food Ingredients, Fargo, ND. “I would encourage customers to dig a little deeper to fully understand who did the extraction of the ingredient, if they have been audited to ensure procedures are in place to comply with all safety regulations and do they hold certifications such as cGMP (current Good Manufacturing Practices).”
Viobin, a business of Denver-based PHM Brands, sources American-grown hemp, said Tim Devey, marketing director of PHM Brands. Viobin submits a sample of the grower's hemp to a third-party laboratory to ensure it is less than 0.3% THC. After extraction at Viobin's facility in Michigan City, Ind., the finished CBD raw material (crude, distillate or isolate) is tested again.
The technology to remove THC from a hemp distillate is the same technology used to separate any molecule in analytical testing, said Dan Kohler, chief executive officer of Hemp Synergistics, Leetsdale, Pa.
“At Hemp Synergistics we use reverse flash chromatography in our remediation process, then proceed with internal and third-party party external lab testing to verify THC has been removed,” he said.
Applied Food Sciences, Austin, Texas, sources its hemp from Europe.
“The EU has verified seed banks that help guarantee consistent and reliable strains of hemp grown with less than 0.3% THC,” said Brian Zapp, creative director. “AFS has partnered with farms that have experience in growing true industrial hemp for decades as opposed to only a few years. Thus, AFS can put manufacturers’ minds at ease with their ingredients because we are using non-narcotic hemp.”
HempRise, Jeffersonville, Ind., a business of Layn Corp., is vertically integrated, said Collette Kakuk, vice president, global marketing. HempRise selects the proper seed, monitors through farming, cultivation, drying, storage and processing. HempRise has its own laboratories perform third-party testing.