USA: Report questions economic viability of industrial hemp

Um report published in the US Department of Agriculture (USDA) Economic Research Bulletin, which summarizes the development of the hemp industrial sector, reveals a lack of optimism about the future. The document characterizes hemp as a “special crop” and notes that “it is difficult to imagine a demand for hectares for growing industrial hemp that matches the demand for hectares for growing corn or soybeans for animal or human food.”

The 77-page analysis was published in February 2020 in a USDA bulletin titled “Economic Viability of Industrial Hemp in the United States: A Review of State Pilot Programs".

'Successful' pilot projects

While the report notes that pilot hemp programs created under the 2014 U.S. Farm Bill have been “successful,” particularly in recovering the hemp crop as a viable agricultural crop, the report concludes that “some challenges have emerged.” at the moment of transition of productions beyond what are the pilot programs.”

“While the number of acres planted and participants in the U.S. industrial hemp industry have increased rapidly in pilot programs, and at a time when hemp cultivation is legally permitted in nearly every state, long-term trends for U.S. industrial hemp US is uncertain,” says the USDA Economic Research Service report.

The report admits, however, that “the recent rapid growth of the alternative plant protein foods sector shows some possibility of a 'specialty' crop suddenly becoming a growth market sector”.

The challenges

In other challenges outlined in the report, the authors wrote that the long-term economic viability of industrial hemp in the United States will be affected by:

• The availability of reliable and transparent data, as well as peer-reviewed market research and information;

• Competition for the area cultivated with conventional crops and cannabis (medicinal or recreational);

• Well-established foreign competitors for hemp product markets;

• The ability to reduce production and price uncertainty through transparency and risk management.

“The coming years should see a resolution of the legal and regulatory issues that restrict hemp production in the United States and it will be imports, consumer demand, domestic production and exports that will dictate the growth and size of the market over the long term. term”, concludes the report.

You can read the full report below or download it here:

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Featured Photo: Esteban López on Unsplash

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Antonio João Costa

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I am one of the directors of CannaReporter, which I founded together with Laura Ramos. I am from the unique Island of Madeira, where I currently reside. While I was in Lisbon at FCUL studying Physical Engineering, I became involved in the national hemp and cannabis scene and participated in several associations, some of which I am still a member of. I follow the global industry and especially legislative advances regarding the different uses of cannabis.

I can be contacted by email at joao.costa@cannareporter.eu

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