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PanXchange Launches Industry’s First Institutional Grade Industrial Hemp Exchange
Traders Magazine Online News, August 1, 2019
PanXchange, a physical commodities OTC market structure solutions provider, today announced the launch of the industry’s first institutional-grade industrial hemp exchange. The marketplace will allow producers, processors, trade houses and end-users to participate in a transparent and efficient cash market for industrial hemp products and will ultimately pave the way for the creation of hemp derivatives contracts.
The opening of the exchange follows PanXchange’s January 2019 launch of the industry’s first hemp price reporting facility, which has provided objective and reliable data to a market primed for explosive growth following its formal sanctioning with passage of the 2018 Farm Bill[i]. Both the exchange and pricing facility support transactions in the highly demanded raw materials used in the creation of CBD (cannabidiol) products – biomass, crude oil, isolate and distillate – and deliver users the assurance that they are they are interacting with thoroughly vetted counterparties.
“Despite the massive market demand for industrial hemp, the ability for producers to transact with processors and end-users in a transparent, efficient manner is woefully inadequate,” said PanXchange founder and CEO Julie Lerner. “Our robust, electronic trading platform provides much-needed price discovery capabilities along with an unprecedented level of functionality, which is key for market participants who seek to interact with other top-tier stakeholders.”
Commenting on the launch of the platform, PanXchange board member and former S&P Global Platts senior executive Andy Bose said: “PanXchange’s hemp market launch not only creates opportunities for physical market participants, but it also serves as the foundation for regulated exchanges to create derivative contracts that would allow involvement by a broader group of market participants – including institutional investors – eager to take part in this exciting market.”
Since 2011, PanXchange has steadily built a reputation for providing the industry’s most advanced market structure solutions for the physical commodity markets that feed and fuel the world – including frac sand data, which is now the industry’s de facto benchmark. The company’s web-based and mobile-optimized platform enables pricing, negotiation and trading capabilities for a wide variety of OTC products globally, offering market participants better market access, more efficient price discovery and the opportunity to maximize profit or minimize operating costs.
“I’ve watched Julie and team develop markets for frac sand and other OTC commodities for close to a decade now, and believe they have the technology, contacts and expertise needed to do the same for industrial hemp,” Bose added. “This is an incredibly exciting moment for the firm, and I couldn’t be prouder to be a part of it.”
About PanXchange
Founded by commodities trading veterans and backed by a highly influential roster of trading and market data executives, PanXchange provides market structure solutions for the physical commodity markets that feed and fuel the world. As these OTC markets have traditionally been bilateral, opaque and consequently expensive to operate in, PanXchange’s trading platform and price discovery capabilities bring greater efficiencies to all market participants: producers, processors, trade houses, end-users, analysts and investors. For more information, please visit www.panxchange.com.
[i] While hemp has been an agricultural staple for centuries, its widescale use in the U.S. was significantly hampered when it was classified as a Schedule I controlled substance in the 1970s (hemp is derived from the same plant as marijuana but it contains only trace amounts of the intoxicating agent, THC).
That changed with the passage of the 2018 Farm Bill on December 20, 2018, which made hemp an ordinary agricultural commodity and therefore removed any restrictions on the sale, possession and transport (including across state lines) of hemp-derived products. At the same time, market demand is exploding for hemp products, most notably CBD (cannabidiol), which Arcview Market Research projects will surpass $20 billion in the U.S. alone by 2024.
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