Canopy Growth, a global cannabis giant that muscled its way into the U.S. hemp market, has announced that it is shutting down its hemp-growing operation in New York state, citing a glut of hemp from last year.
The Canada-based company will cease farming operations in Springfield, New York, but will continue using its hemp supply to produce hemp-derived CBD products for the U.S. market, the company said in a Thursday statement.
The move is part of a shift in global strategy to optimize production and better align supply and demand in the current market, Canopy said.
“I believe the changes outlined today are an important step in our continuing efforts to focus the company’s priorities, and will result in a healthier, stronger organization that will continue to be an innovator and leader in this industry,” CEO David Klein said.
The company made no mention of its industrial hemp processing facility Kirkwood, New York, which was being renovated from a former vacuum-cleaner production plant.
Klein took over as CEO in January. His predecessor Bruce Linton was fired after Canopy’s disappointing financial performance in the first quarter of 2019.
