Panda Biotech’s first large-scale industrial hemp gin has found itself an equity partner.
The first-mover in the emerging U.S. industrial hemp fiber and hurd industry announced a landmark equity partnership between the Panda High Plains Hemp Gin (PHPHG) project and the Southern Ute Indian Tribe Growth Fund, which is owned by the federally recognized Native American tribe. Aka-Ag LLC, a Growth Fund subsidiary, inked the strategic alliance.
This investment advances PHPHG’s anticipated fourth-quarter 2023 launch, the company’s first large-scale industrial hemp gin that was most recently expected to be operational by the middle of last year.
“Panda Biotech could not have selected a better equity partner for our first project, the Panda High Plains Hemp Gin,” Dixie Carter, president of Panda Biotech, said. “The Southern Ute Indian Tribe and its subsidiaries bring numerous strategic opportunities to what is anticipated to be a successful, long-term partnership.”
The Southern Ute Indian Tribe is based in Colorado on the Southern Ute Indian Reserve and is the first tribe in the nation to achieve a triple-A general-obligation bond credit rating. The Growth Fund, the tribe’s business division, aims to support eco-minded business investment opportunities through Aka. The Growth Fund’s Aka-Ag division shares Panda Biotech’s vision for PHPHG as hemp offers a sustainable ecological option versus other textile fibers and requires less water and chemicals to grow compared to other crops used in textile manufacturing.
“The Growth Fund is honored to partner with Panda Biotech on the PHPHG project,” said Shane Seibel, Growth Fund’s executive director. “The Tribe and Panda have had decades of success in various business endeavors. We view the PHPHG investment as a complementary and strategic partnership that will align with our company values and result in a business providing sustainable solutions for the future.”
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Located in Wichita Falls, Texas, the project is set to be the largest hemp decortication center in the United States as well as one of the world’s largest industrial hemp processing facilities. To date, approximately 95 percent of the necessary hemp processing equipment has been manufactured and mostly delivered to the 500,000-square-foot facility, which will process only U.S.-grown hemp straw.
Panda Biotech previously expected the facility to begin its first operations in the first quarter of 2021 and be fully up and running by the first quarter of 2022, with full production producing more than 35 million pounds of apparel-grade, cottonized hemp fiber. In 2020, the company donated 60 tons of free hemp fiber seed to Texas agricultural producers in an attempt to jumpstart the industry and to help farmers gain experience from their first trial crop of industrial hemp and understand how the hemp seed would respond to the local conditions. Now, Panda Biotech is contracting with producers for the 2023 growing season as it has seed that’s been successfully grown in the region around Wichita Falls available for farmers.
The Dallas-based company previously received a $2.8 million incentive deal from Wichita Falls under the promise to create at least 50 new jobs, which included a $1 million loan that’s since been given extensions considering the delays that have plagued the plant’s opening.
“It took a while for us to find the right partner,” Mark Dsa, business development of Panda Biotech, said regarding the delays. “Because what we wanted was not just someone who would come with the money, but someone who had the right mindset, aligned with our values and understood exactly where we were going.”