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HempFusion (TSE:CBDu) continues to surprise investors with the pace of its international expansion. The health and wellness specialist recently applied to UK regulatory authorities for a distribution license, but it has now inked an agreement with Alibaba’s T-Mall Global, which means it will now be reaching 750m potential new customers in China.

HempFusion specialises in premium probiotic supplements and products containing CBD. Its Probulin Probiotics venture, a wholly-owned subsidiary, is launching on Tmall effective immediately. This is a major step in the company’s development, as it is already well-established in the US over the counter market and also recently launched an online store for US customers.

“This strategic launch provides us with a tremendous opportunity to reach one of the largest online consumer bases in the world and drive significant revenue for the Company,” said Jon Visser, HempFusion’s Chief Revenue Officer.

Hempfusion probiotic supplements to hit China market by end of March

With shipments expected to begin early next week, HempFusion anticipates its Probulin products will be available for purchase on Tmall with a go live date currently set at March 29, 2021, ahead of one of China’s largest single day shopping extravaganzas, the mid-year 618 shopping festival, which shattered records last year with more than US$98.52 billion in single day sales.

We have been following HempFusion since it first listed in Canada. The company is a leading provider of health and wellness CBD products with a number of successful brands in the space, including Probulin Probiotics and Biome Research. It sells in approximately 4000 retail locations in the US, in all 50 states.

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In 2020, health supplements and probiotics were among the most popular categories on the Tmall platform. Tmall regularly engages consumers with brands through livestreaming, educational videos and group chats.

Visser said that HempFusion would be launching further brands in China using Tmall. Probulin Probiotics is the first American company that is in a position to deliver cold and protected probiotic supplements directly to the Chinese consumer. Its probiotic products are now available in eight countries around the world.

Asia Pacific probiotics market is expanding rapidly

According to Mordor Intelligence, the Asia probiotics market is projected to grow at a CAGR of 9.6% during the five years from 2020. Mordor said the market, including China, is driven by robust demand for health-based products, especially among younger consumers. The market has experienced increased innovation and customisation of products, based on requirements and effective communication across various age groups.

Built on a foundation of regulatory compliance and human safety, HempFusion’s diverse product portfolio comprises 48 SKUs including tinctures, proprietary FDA Drug Listed Over-The-Counter (OTC) topicals, doctor/practitioner lines and more. With a strong focus on research and development, HempFusion has an additional 30 products under development.

Asia currently accounts for almost half of the global probiotic market, and within that China has 55% of the market. China is also the third largest market globally for probiotics dietary supplements, and is slowly overtaking Italy, which ranks in second place. Some Chinese market participants have already projected market compound growth of around 60%. This compares with 18% growth in the UK, which is considered the fastest growth market for probiotics in Europe.

HempFusion stock went live in Toronto in January at C$1.60. It is currently trading at C$2.71 It has a 52 week high of $3.56.

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Stuart Fieldhouse

Stuart Fieldhouse

Stuart Fieldhouse has spent 25 years in journalism and marketing, including as a wealth management editor for the Financial Times group, covering capital markets and international private banking, and as an investment banking correspondent for Euromoney in Hong Kong. He was the founder editor of The Hedge Fund Journal.

Stuart has worked at CMC Markets, supporting the re-launch of its global financial spread betting and CFD trading platforms. He is also the author of two books on trading, published by Financial Times Pearson. Based in The Armchair Trader’s London office, Stuart continues to advise fund managers, private banks, family offices and other financial institutions.

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