HELP FOR HEMP INDUSTRY

$60,000 grant will fund non-woven fibre matting line for Kenex operation

PAIN COURT -- Ontario's small, but growing, commercial hemp industry
received a financial boost Monday with help from a federal government
grant. A $60,000 grant has been awarded to Kenex Ltd. under the
Agricultural Adaptation Council's Can-Adapt Program.

"As one of the first supporters of hemp within the federal government, I am
pleased that Kenex is leading the way locally with this alternative crop,"
said Lambton-Kent-Middlesex MP Rose-Marie Ur. "The funding announced today
will help process the 1998 crop, leading to a tripling of the acreage for
expanding export markets." AAC will help fund a non-woven fibre matting
line that will create a value-added product from hemp fibre for use in the
textile, auto parts manufacturing and construction industries.

The new production line is just the start of hemp product development.
Kenex plans to market 400 tons of hemp fibre or matting by the end of the
year for various industrial applications with a target of 1,500 tons in 1999.

"This project will have a significant impact on Ontario's economy," said
Ralph Stephen, a director of the AAC. "The 2,000 acres currently under
contract with Ontario farmers is expected to triple by the year 2000 while
the processing facility will create jobs and require the development of new
farm equipment."

CanAdapt funds are available for projects designed to foster long-term
growth, financial self-sufficiency, employment and competitiveness for
Ontario's agriculture, food and rural communities. To date, over $1.8
million has been committed to 28 projects benefiting Ontario soil and water
conservation. Currently, Kenex has about 52 growers on contract -- 40 in
Chatham-Kent, six in Lambton, five in Essex and one in Haldimand-Norfolk.

"This year's crop will create direct farm income of $2 million to the
contract growers," said Ur. She said the project receiving the $60,000
funding will include a research facility to do fibre studies, oil seed
fatty acid levels and possibly product development. "This is an opportunity
to re-establish a crop formerly grown in Ontario, provide farmers with an
alternate crop and enter a market with large expansion potential." In the
long term, she said, the project is expected to result in production of
fibre, hemp grain and straw for sale in Canada and the U.S. "It will mean
the diversification of crops in southern Ontario, an increase in direct
farm income, with additional crop added to rotation, the protection of our
natural environment, as hemp usage increases in textile, auto and
construction industries with important replacement and great export
potential."

Jean Laprise of Kenex said his firm was pleased to receive the financial
assistance from CanAdapt. He stressed that it represents, however, a small
percentage of the $1 million in the project by his company. Laprise said
that so far Kenex has invested more than $4 million in the hemp industry.

For more info contact: Kenex, Ltd. Jean Laprise (519) 351-9922

Checked-by: Mike Gogulski