Should you build your own extraction lab?

With demand for THC and CBD distillate products skyrocketing around the world, it’s never been a better time to be a cannabis cultivator or producer of edibles, topicals, or beverages.

“Long term forecasts predict that US sales will reach $37 billion by the end of 2024.”

–MJBizDaily, June 30, 2020

As cannabis cultivators continue to refine their growing techniques to produce better biomass, and THC and CBD product companies continue to push their brands forward, it seems like the process of extracting distillate from biomass is one of the biggest hurdles facing those trying to capitalize on this rapidly expanding market.

How to Build a CBD or THC Extraction Lab

Since CBD and THC extraction is a complex process resulting in a product that will be ingested or used topically by humans, governments have implemented a ton of regulatory requirements you’ll have to meet to produce your own CBD or THC distillate.

As jurisdictions legalize hemp and cannabis for medical and recreational use, they’re implementing strong licensing, quality-control, and compliance standards for cultivators and producers.

To build an extraction lab, you’ll need to obtain professional engineering reports, permits for fire and electrical, and local processing licenses. You’ll need to hire a GMP consultant and develop standard operational procedures (SOPs) that pass a third-party review. You’ll have to source the right equipment, install, calibrate, and test it, and hire and train scientists and lab staff. Sadly, we’ve seen companies venture quite far down this road before realizing that they lack the necessary resources or technical expertise to complete construction of their own extraction lab. Many have indicated that they would have rather brought in a knowledgeable partner so they could remain focused on what they do best – building their brand.

Challenges in Building an Extraction Lab

If you are going to build your own extraction lab, you’re going to face a lot of challenges along the way. Here are just a few:

The build can take 12-24 months to complete
Start-up costs for a typical 2,000 sq. ft. lab can run as high as $7.5M
The time it takes to conduct technical research into which process and equipment
Developing and refining SOPs requires expert consultants which can be costly
You’ll have to hire and train staff to operate the lab
Extraction equipment and technology is rapidly evolving, meaning your lab could already be outdated by the time construction is completed

Alternative Options to Building Your Own Extraction Lab

One option for those who don’t want to build their own extraction lab is toll-processing: the practice of outsourcing your extraction to a large-scale, 3rd party facility that performs extraction services for a fee. While this option solves problems for those that don’t want to build their own lab, it also brings obstacles. First there’s the timing, costs, and concerns related to transporting your biomass to the toll-processor.

Another major obstacle is the fact that you’re at the mercy of the toll-processing company’s pace.

Thankfully, a new option has recently entered the market: a turnkey mobile extraction lab partner offering an extraction-as-a-service model. These labs arrive at your location within a few months of the contract being signed and are ready to start producing once the quick installation process is complete. Labs will comply with all local regulatory requirements and come fully staffed with documented SOPs. Since labs are owned and operated by the partner company, you’re not responsible for maintenance or upgrades to the equipment. Finally, they’re a more environmentally friendly alternative to most other extraction methods and require no extraction lab CAPEX.

View our webinar with MJBizDaily, How to tackle extraction and stay competitive, for a more in-depth examination of your options when it comes to building a THC or CBD extraction lab.

You can also download our discussion paper, Proprietary construction or a self-contained extraction lab: what’s right for your company? to learn more about the pros and cons of working with an extraction-as-a-service partner.

extractX Mobile Labs

If you want to save time, money, and headaches while building an ethanol extraction lab, reach out to extractX today to learn about our full range of mobile lab solutions. Our mission is to build the best mobile THC and CBD extraction labs in the world, keeping you hyper-focused on cultivating or procuring the best biomass, and/or developing and marketing the best CBD and THC distillate products. extractX labs process up to 500,000 pounds of biomass per lab, per year.

Have a question, comment, or topic that you’d like to see covered in one of our blog posts? Engage in the comments section or reach out directly and our team of experts will get back to you as soon as possible!