Hartford Business Journal

26 Hartford Business Journal • November 2, 2020 • www.HartfordBusiness.com Suffield's Lasa Extract sees opportunity in burgeoning CBD market By Cara Rosner Special to the Hartford Business Journal R ick Sotil jokes that, as someone who's "never even smoked a joint," he may seem the unlikely leader of a CBD business. "My kids were laughing," he recalls, when he first began exploring the venture about two years ago. Indeed, it seems a far cry from the Cuba native's past as a professional world champion jai alai player; and from his other business, Sotil Tree Service, which he's run for more than 20 years. But these days he's bringing the same passion he brought to jai alai and woodworking to Lasa Extract, the Suffield-based business he runs on what used to be a tobacco farm. Unlike the dozens of CBD retail shops that have popped up through- out the state, Lasa Extract is a CBD manufacturer. Local farmers bring him hemp plants, which he dries out in a kiln. He can dry 3,000 pounds of wet biomass into 500 pounds of dry biomass in about five days, he said. Once it's dry, hemp samples are sent to be tested and approved for quality purposes by the state Depart- ment of Consumer Protection. Once he gets approval from the state, he grinds the dried plant matter very fine and runs it through an extrac- tion machine, which pulls out oil that is then deep-frozen and processed. His state-of-the-art extraction pro- cess, which relies on carbon dioxide rather than the more commonly used ethanol, results in a high-quality and cleaner product, he said. "From there, you can make what- ever you want," he said. Sotil, 59, originally planned to be a CBD oil wholesaler but said he believes so strongly in the quality of what he's producing that he now plans to launch his own line of CBD products. He aims to begin manufac- turing products within a few weeks. He'll start with tinctures and lotions, he said, "and then we'll experiment." Focus on quality CBD, which stands for cannabi- diol, is one of the active ingredients of marijuana, or cannabis, but is derived directly from the hemp plant and does not, by itself, cause a "high" in users. It lacks the THC found in marijuana. CBD is marketed for a wide range of uses, including pain relief and anti-anxiety uses, and has grown in mainstream popularity in re- cent years. Since it typically is sold as a supplement, not a medication, it is not regulated by the U.S. Food and Drug Administration. Nationwide, CBD is big business. The U.S. CBD market is projected to reach $4.7 billion in sales this year, up 14% from $4.1 billion in 2019, accord- ing to market research firm Bright- field Group. While retail sales have taken somewhat of a hit during the pandemic, according to the report, the industry largely continues to thrive. The total U.S. CBD market could reach $16.8 billion by 2025, as growth is being driven by expanding distribution channels, media cover- age, and natural wellness trends, Brightfield Group said. CBD also presents new oppor- tunities for Connecticut farmers, who could earn between $5,000 and almost $12,000 an acre for growing hemp, according to a February report by UConn's Zwick Center for Food and Resource Policy and Department of Agricultural and Resource Economics. There's a high demand for CBD hemp, but challenges for farm- ers remain since many states are quickly expanding their production, which drives prices down, and CBD imports could pose an additional threat, the report says. Sotil has owned the Suffield farm where Lasa Extract is based for about 18 years; he originally bought it to be the home base for his tree business, which he still owns today. But when someone suggested he consider getting into the hemp business, he looked around his 37,000 square feet of barn space — per- fect for hanging the plants — and said to himself, "Let me investigate." Once he learned how popular CBD products were on the West Coast, and after Connecticut legalized the sale of hemp products in May 2019, he was inspired to take the plunge, especially since he had most of the needed infra- structure already in place. The company name came eas- ily, too — Lasa means "calm down" in Basque, and is the nickname under which Sotil played jai alai. Earlier this month, Gov. Ned Lamont vis- ited the business, where he signed a bill that up- dated state law to keep Connecticut hemp producers in compliance with federal requirements. There have been some bumps in the road, Sotil admits, like when he tried to grow thousands of hemp plants a couple years ago. "Big mistake," he said. "I am not a farmer. We've made some mistakes, and we don't repeat mistakes." The COVID-19 pandemic has slowed his growth plans a bit, since he's limiting the number of contrac- tors he allows to work on-site. Lasa Extract currently includes Sotil, his wife Valentina, and a chem- ist, but Sotil says the business is poised to grow its employee base as it launches its product line and expands production. "I believe in this so much," he said, adding his process will give consum- ers a reliable, high-quality product. "When I take some CBD, even some- times from the same company and the same milligrams, it has a com- pletely different effect on me. That's what I don't want at Lasa Extract. What we're going to bring to the table is consistency. I'd much rather have product quality over quantity." COMPANY PROFILE U.S. CBD market size and forecast (2019-2025) 2019 $4.2B 2020 $4.7B 2021 $6.lB 2022 $9.7B 2023 $12.4B 2024 $14.8B 2025 $16.8B Source: Brightfield Group Lasa Extract Owner Rick Sotil (right) with lab director Nathaniel Huffman looking at a recent CBD sample. PHOTO | LASA EXTRACT

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