After a brutal shake-up that halved hemp area in two years, the industry is focusing on hemp as a source of grain and fiber, a less profitable but possibly more stable market than hemp oil. cannabinoids (CBD), used in food, beverages, and dietary supplements. Analysts say the unclear regulatory status of CBD has strangled sales.
Producers rushed to industrial hemp after the legalization of cultivation by the 2018 agricultural law, attracted by reports of high-income hemp sold for processing into CBD oil. But the pandemic and an excess of hemp crushed wholesale prices.
Licenses were issued for nearly 285,000 acres in 2021, below 466,000 acres in 2020 and more than 511,000 acres in 2019, when production was the highest in history, Hemp Industry Daily reported last fall. .
The 2022 Hemp Industry Opportunities Report said licensed acreage fell 55% “to levels observed before the 2018 agricultural bill.” The 2014 Agriculture Act allowed pilot and hemp research programs.
CBD prices fell below production costs, but the “bright spot was the supply and demand of fiber and grain,” the report said. “We are just beginning the renaissance of hemp.” Economist Beau Whitney, a contributor to the report, said hemp plantations for grain and fiber are expected to surpass the CBD area by 2024-25.
Wendy Mosher of New West Genetics, a hemp seed developer, told Hemp Industry Daily that demand was increasing for seeds to grow hemp for fiber. “We’re seeing the change from CBD to fiber.” Mosher was also optimistic about the potential hemp grain market.
The USDA is scheduled to release its first national hemp report on Feb. 17, with data on area planted and harvested, yields per acre, production and value of industrial hemp, according to a survey of 20,500 growers. The report will be a benchmark for the crop and will help farmers decide how much and what kind of hemp to grow, said Kevin Barnes of the USDA statistics agency. So far, analysts have relied on state licensing data and rudimentary USDA data.
By law, industrial hemp cannot contain more than 0.3% of tetrahydrocannabinoyl, the psychoactive substance in marijuana.
Based on the interest of farmers and processors, two hemp trade groups said last year that they would collaborate on a control program proposal to pay for industrial hemp research and promotion.
The USDA operates 21 control programs for commodities ranging from cotton to mangoes.
