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'Every day it is delayed costs us money': Supply chain problems creating costly construction delays

Construction of HempRise's Jeffersonville facility is delayed six months because they're having difficulties getting building materials.

JEFFERSONVILLE, Ind. — A shortage of stainless steel and other needed materials has delayed the construction of a hemp processing facility in Jeffersonville by months.

HempRise's facility, which the company says will be the largest hemp processing facility in the country, is behind at least six months.

"Any of the delays that we are experiencing are a direct result of the COVID virus," said Kyle Einhorn, HempRise's vice president of sales. 

Einhorn said the company has made extraordinary efforts to get material to their plant so construction is not delayed even longer.

"We've had a container ship parked off the coast of Long Beach, California since May,” Einhorn said. “We've had the ship diverted to Vancouver, Canada, at which point that container is going to be loaded on a rail system and shipped down to Jeffersonville, Indiana. In the meantime, we've still needed material from that container so we paid for an airlift container to be sent here directly at a significant cost, but a cost we needed to pay because we need to get this facility operational."

'Every day it is delayed costs us money'

HempRise's situation is not novel. Construction materials, especially those coming from overseas, have been tough to come by. Around the country, small businesses are starting to report more and more issues with international supply chain.

Data from the U.S. Census Small Business Pulse survey shows in August 2020, 10% of businesses surveyed reported issues with international supplies. Now, almost 20% are reporting disruptions.

Credit: U.S. Census Small Business Pulse Survey
Small businesses report more international supply chain disruptions in recent months.

"Every day it is delayed costs us money,” Einhorn said.

Hemp was legalized in 2018, so there are only a handful of processing facilities for farmers. That's one reason the company is working to get up and running this fall as farmers start harvesting their crops.

"We want to get the facility up and running as soon as possible and work to get the hemp off the field and get it processed in our facility,” Einhorn said.

The company's supply chain concerns will not end when construction is complete. If the market does not level out, Einhorn said they will have issues getting replacement parts should they need to make repairs on their machinery.

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