Panda Biotech president disputes 'dubious proposition' claim

The president of Panda Biotech Dixie Carter said she remains optimistic about the company’s hemp-processing plant in Wichita Falls and she was critical of a recent article on a hemp-industry website that called the venture a "dubious proposition.”

Hemp Today, which titles itself the “Voice of the Global Hemp Industries,” pointed to a series of delays in opening the plant in the former Delphi building on I-44 north of Wichita Falls.

“After Panda announced a plan to create the ‘Largest Industrial Hemp Processing Facility for Fiber and Cellulose in the United States’ in 2019, the project has repeatedly gone off schedule,” the publication said in story published Oct. 24.

The article is headlined, “Will widely hyped Texas hemp fiber processor finally get its factory going?”

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Panda president Dixie Carter said she thought the headline should read, “Panda Biotech has overcome every possible global challenge to bring the largest industrial hemp processing facility in the Western Hemisphere to Wichita Falls.”

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Those challenges have included financing.

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After announcing the choice of Wichita Falls for its $100 million plant in 2020, Panda Biotech received a $2.8 million incentive package from the city through its economic Development Corporation. The package included a $1 million loan. Wichita County kicked in a 70-percent tax abatement.

For the bulk of its financing, Panda Biotech put in a bid with the Texas Bond Review Board for $100 million in Private Activity Bond money, but later withdrew the bid.

Carter said at the time, “We’ve got other options. We’ve got other people who have been trying to get our business.”

Next, Panda announced in December 2021 the project would be financed by the sale of up to $85 million tax-exempt “green” bonds issued through the economic development corporation in Mission, a Texas border town.

That deal never went through.

“The day we were going to market the bond market collapsed,” Carter said.

In the two years since then, Carter said the company has been raising money “through different means.”

Panda closed on the purchase of the Delphi building from a local group in July 2021. Tax value at the time was $5.8 million.

Panda announced in March 2023 the company had entered an equity partnership with the Southern Ute Indian Tribe Growth Fund in Colorado. Carter said the fund is a minority partner.

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The heart of the incentive deals with the city is a promise by Panda to create at least 50 new jobs by 2023. Carter has predicted that number might surpass 100, in addition to 700 secondary jobs that might be created.

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Panda's optimist projections for the plant set off an alarm at Hemp Today.

“Panda has tossed around the superlatives from the get-go – always a red flag,” the article said.

Panda Biotech initially said the plant would begin production in early 2021, but later changed the date to early 2022 and then to late 2022, then Carter predicted the first quarter of 2023. That did not happen. Carter said the plant is still coming along despite the COVID-19 pandemic, a bond market crash and a stock market crash. While not everything is in place, Carter said online testing of equipment should begin this week.

She said the company has put 10 to 15 workers on the payroll, but she’ll go before the City Council on Oct. 7 to request a three-year extension on the 50-person hiring commitment, which would give her company until August of 2026 to fulfill the obligation.

“The contract that we had (with the city) was short and they have to be employees for a certain period of time, so we just don't want to have to go back and extend anything. We’re asking for a three-year extension on an incentive plan that they already have in place,” Carter said.

She said hemp is already being delivered to the site, with the smaller of two storage units half full. She said her company is offering area farmers incentives to grow the crop.

After a hiatus on its repayment of the $1 million loan from the city, Dixie Carter's father, Robert, the Panda Biotech chairman and CEO, personally guaranteed repaying of the note at a rate of $70,000 a month. Dixie Carter said the loan, with interest, will be paid off in December.

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When Panda Biotech picked Wichita Falls for its location, local government and Chamber of Commerce leaders proclaimed it would be the largest investment of private capital in the city in 40 years and predicted Wichita Falls would become the “epicenter” of hemp production.

But the crop has been slow to catch on in Texas.

Congress restricted growth of hemp in 1937 because of its connection to marijuana. The 2018 Farm Bill opened the door to legal hemp production and hemp was heralded as a wonder crop. The reality of heat, drought, crop insurance and market conditions have cooled the enthusiasm for the crop in Texas.

This article originally appeared on Wichita Falls Times Record News: Panda Biotech president disputes 'dubious proposition' claim