How much to charge for THC removal?

We are interested in doing tolling or split arrangements for the first 3-6 months of capacity.
We will have relatively small capacity out the gate, around 100 liters per month.
We can take in crude, or distillate.

How much is the going rate for tolling services around THC compliance, ie. reducing a full spectrum hemp extract to 0.0% THC.
What would be a fair split arrangement if someone is providing us with crude, we were thinking something like 60/40 in our favor.
On the other hand, we can buy crude for Ā±$1500/liter, remediate and distill, and resell for Ā±$7000-$10000.

How would you go about pricing this service?

2 Likes

Well first of all what do You offer
Removing THCa from crude
Or removing THC from decarboxilated crude or Distillate

Then the question is how much of the T hca or thc can You remuve in %
Teck up to 2 % are for sale

Then the question is do You Return the thc in a seperate flask or is iT lost
Returning iT has the advantage that iT is hemp derived Wich has a diffrent tax on iT in Some states

So what do You offer ?

5 Likes

You might ask yourself what is the market value of the product youā€™re returning to the customer vs. the value of the product they gave you.

Example (prices are just rough examples):
Input - 1 kilo of crude, market value $2k
Output - 500 grams THC-Free distillate, market value $8/gram = $4000

So if you take 60% of that $4000 you have left your customer with a loss (40%x$4000=$1600).

Iā€™m just speaking from experience as a toll processor who sees a wide variety of customers and providers out there. The example above is of course based on some basic assumptions that you need to validate with your crude provider and local market. I have turned away offers to process our distillate to THC-free because of the split costs. Granted, there is a currently a bit of a shortage for THC-free due to the methods and technologies employed but anyone putting pen to paper can also figure out whether it makes good business sense to pursue that as well. In general, tolling regardless of whether youā€™re extracting, distilling, making THC-free or isolate needs to provide value to the customer. If they end up with less value than they started with then there is no incentive to engage you for your services.

9 Likes

No THC lost[quote=ā€œnomadgt, post:3, topic:18692ā€]
Example (prices are just rough examples):
Input - 1 kilo of crude, market value $2k
Output - 500 grams THC-Free distillate, market value $8/gram = $4000

So if you take 60% of that $4000 you have left your customer with a loss (40%x$4000=$1600).
[/quote]

You make an excellent point. I think your rough numbers are off, since $8/g is $8000/kg. So we would split 40% of the $8000, $3200, that seems still profitable for the crude supplier. Sorry if I misunderstood.

Nope, you are going to lose product converting crude to THC Free Distillate. Hence why it went from 1,000 grams to 500 grams and multiply by $8 = $4,000. Canā€™t take $8 x 1,000 grams.

6 Likes

What happens to the THC that is removed from the crude? You need a state license to work with THC in the US because it is federally illegal correct? Would it be legal to take this isolated THC and repurpose it? For example isomerization from THC to CBN?

3 Likes

You are thinking difrent than me
If i Where to make a cbd chocolate bar
Of 100gr and iT had a 0,2% thc content
There is 200 Mg Thc in that bar
Hemp derived thc diffrently taxed then cannabis derived thc
But thats a spacy dose of thc
So for Some products i would leave Some. Thc in :grinning:

1 Like

What about charging for each gram returned to owner? Charge like 1.50 a gram for whatever they get back. As for the THCā€¦you can charge them for thatā€¦but only if they have licenseā€¦other than that the THC should be destroyed

5 Likes

I have been asking around and these are the rates asked
To take out a maximum of 2% thc asking
250$ a liter beeing Thca No Return of thca
To take out up to 8% thca/thc
10% of the volume procesed When done
And No Return of the thc

1 Like

We are expecting to have 5-10% loss, not 50%. The less THC, the less overall loss, but it shouldnā€™t exceed 10% even with 5% THC.

We will be removing THC from decarboxylated winterized crude, or distillate.
As far as THCa, we will need to run some R&D using a sample, but we believe that we can separate THCa from non-decarboxylated winterized crude. It seems like there is demand around non-decarboxylated crude remediation, can you share more about that?

We can remove up to Ā±5% confidently, higher than that and Iā€™m not sure we are dealing with hemp, but we will be able to remove greater amounts as well.

The THC is mostly recovered, what is done with the THC depends on regulatory compliance. What can you tell me about the tax rates of hemp derived THC? It seems like a rather grey-area now since neither the Farm Bill nor the US Hemp Roundtable makes any mention of what is suppose do be done with ā€˜hotā€™ hemp extracts, let alone the THC from hemp extracts.

1 Like

You may want to test that theory. Going from crude even to regular distillate loses 40-50% of content. THC-free will lose even more so.

New york state wants to tax cannabis but not hemp in the near future.

Crystallization and re-crystallization are free my man.

Im working on this as we speak and am wondering the same thing.
1K crude 1800-2k
1st pass distilate ~60% yield from crude (gives 600g Cannabinoid Distilate)
Lab tested cannabinoid distilate and it came back @ 80% cannabinoids of which 75% CBD 4%THC (600x.75=450g CBD) assuming no loss
To make a kilo of iso you need 1000/450= 2.2-2.5 Kilos of Crude @ 2k each =$4444-5000
now want to go to T Free distilate ā€¦

Any suggestions?

2 Likes

You could just buy the T Free distillate for $8k/kilo or look into smaller scale THC remediation machines that arent as expensive. You can get a 5-8 kilo/day chromotography unit for $50-$60k plus $0.25-$0.50 per gram it produces.

2 Likes

Iā€™ve heard that most of the t free distillate that is priced around $8/9k does not have minor cannabinoids that it would have in the flower. Iā€™ve heard this from a relatively major private label manufacturer.

If it doesnā€™t have any other cannabinoids in it then it loses any value it might have over isolate. The only difference would be potency with isolate being more potent and cheaper. Ive seen this brand of T-free too. I suspect itā€™s from labs using chromatography and theyā€™re saving the other cannabinoids to sell separately at a much higher price.

1 Like

Does anyone know the average value for THC free crystal resistant distillate?

I guess the stuff Iā€™m working with could be considered broad spectrum as it still has minor cannabinoids.

Depends upon geography i think. Prices are cheaper in CO for instance compared to the East Coast. $10k or so for that here in CO but can be had for less if you shop around.

1 Like