In 2023, U.S. Hemp-derived Cannabinoid Sales are Larger than Legal Cannabis Sales
The U.S. cannabinoid market is a major national industry. At over $28 billion in revenue and with a nationally integrated supply chain, the hemp-derived cannabinoid market is currently larger than the entire legal U.S. adult-use and medical markets.
Will Proposed Federal Fixes Do More Harm than Good?
Hemp operators are looking for federal support in terms of standardizing rules and regulations related to hemp-derived cannabinoids so that the industry can maintain its extensive supply chain, support consumer demand and continue interstate commerce. Right now, a one size fits all policy is doing more harm than good, and has reduced the fiber and grain opportunities by $20 billion alone in 2022/2023.
Many groups are involved, and policy makers are getting conflicting inputs. As a result, policies are haphazard, when they should be focused on specific sectors and issues like public safety, youth access, and product testing. Issue-specific policies would be beneficial because they would limit unintended impacts on other hemp sectors.
The Focus on Hemp Cannabinoids is Hurting the Future of Fiber and Grain
Policies related to hemp fiber and grain are being overshadowed by cannabinoids. This may result in a lack of federal support for fiber and grain infrastructure. Hemp fiber and grain opportunities are already picking up, with a greater percentage of acres being licensed for fiber and grain each year.
While the industry is preparing for a stepwise growth in hemp fiber and grain, will federal regulators be ready for the surge in acres required to support this growth? To illustrate the point, here’s an example: The average U.S. hemp farm in 2022 was 17.1 acres. In order to support one million acres of demand for hemp, the U.S. would require 58,480 licenses to be issued. That is equal to issuing 160 licenses per day. Will the farm bill provide funding to support this explosive growth, or will its focus on cannabinoids be an obstacle for this emerging industry?
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