Um report published in February 2020 in the US Department of Agriculture Economic Research Bulletin (USDA), already showed a lack of optimism regarding the future and development of the industrial hemp sector, as reported by Cannareporter at the high. The document characterized hemp as a “special crop” and noted 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 a USDA bulletin titled “Economic Viability of Industrial Hemp in the United States: A Review of State Pilot Programs".
Hemp was already off the list of controlled substances in 2019
Although the DEA (Drug Enforcement Agency) said in August 2019 that hemp is not a narcotic, the sector continues to face difficulties. The agency clarified that “hemp preparations, including hemp plants and cannabidiol (CBD), below the threshold of 0,3% delta-9 THC, are not controlled substances”. Despite the DEA's announcement, the Food and Drug Administration (FDA) at the time drafted regulations for cosmetics, dietary supplements, foods and food additives, following the 2018 Farm Bill. The US Hemp Industries Association (HIA) has advised the FDA that the existing rules for these products be simply expanded to include hemp extracts. However, like in Europe, the hemp sector in the US has not had easy regulation either, with ups and downs. The last rules for growing hemp in the US were published in January 2021.
'Successful' pilot projects
While the USDA-published report noted that pilot hemp programs created under the 2014 U.S. Farm Bill were “successful,” primarily in recovering the hemp crop as a viable agricultural crop, the report concluded that “ some challenges appeared at the time of transition of productions beyond what are 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,” read the USDA Economic Research Service report.
The report conceded, 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 would 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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