Growing demand for CBD is increasing pressure on companies that provide key cultivation equipment and industry supplies.
As part of its commitment to build a large and well-supplied sales channel, hydroponic supplier Sugarmade Inc. (OTCQB: SGMD) is in the process of making acquisition of companies that supply the hemp industry. An increasing need for supplies is coming from companies such as Canopy Growth Corporation (TSX: WEED) (NYSE: CGC), a major cultivator and processor making moves on the CBD drinks and well-being markets. Cronos Group Inc. (TSX: CRON) (NASDAQ: CRON) has entered into a supply agreement with another provider to ensure the materials it needs for its products. Global efforts by companies such as New Age Beverages Corporation (NASDAQ: NBEV) and Aphria (TSX: APHA) (NYSE: APHA) may further strain U.S. supply chains, due to greater cultivation restrictions in other parts of the world.