US COMPANY TO BUILD 2 PLANTS FOR HEMP PROCESSING IN CANADA

A U.S.-based agricultural company plans to build two hemp-processing plants
by 2001 in Canada's western province of Manitoba, the head of the company's
Canadian operations said.

"There will be two distinct plants located on the same site. One is
dedicated to food and one is dedicated to fiber," said Douglas Campbell,
president of the Canada division of Consolidated Growers and Processors.

Consolidated Growers will spend 25 million Canadian dollars (US$16.5
million) to build the plants to process hemp, which until last year was
illegal to grow in Canada, he said Monday.

Mr. Campbell said the stalk-processing plant could handle 100,000 metric
tons a year and the seed-processing plant could handle 15 metric tons
annually.

"It was not even legal to grow the crop until 13 months ago," Mr. Campbell
said, adding that plantings in the agricultural Prairie provinces of western
Canada were expected to increase to 18,000 acres this year from 600 acres a
year ago.

The Canadian government approved the growing of the plant in 1998.

Mr. Campbell said the seed-processing facility would produce oil, to be used
for human and industrial consumption. It would also produce meal, used in
animal feed and beer, and hulls for animal feed and building materials.The
stalks would be processed for use as building materials such as insulation,
auto parts such as car door panels, and pulp and paper for cardboard
production.

The plants will be located in Dauphin, a small community some 300 kilometers
(180 miles) north of Winnipeg.

They would use hemp grown in Manitoba as well as the neighboring province of
Saskatchewan, Mr. Campbell said.

He said Consolidated Growers would probably export much of its production to
the United States. "Now it's not legal to grow seeds in the U.S., but it's
legal to use its products," he said.

A decision late last year by Body Shop International PLC to sell hemp- based
skin-care products has helped grant some legitimacy to the plant.

Legal authorities in Canada had frowned on the growing of industrial hemp
because the same cannabis sativa plant is used to produce marijuana. But
industrial hemp, which is still illegal in the United States, contains much
less of the drug than its illegal brother.

Up to and through World War II, the United States produced hemp products
similar to those it now imports. Indeed, hemp production was encouraged as
part of the war effort. But a subsequent crackdown on marijuana use led to
stiff laws against the drug and a revision of laws involving hemp
production.