U.S. Hemp CBD Market to Triple by 2022
More comprehensive insight and analysis about the Farm Bill, including key developments shaping the hemp and CBD markets both within the U.S. and across global sectors, was released in 2019. The Global State of Hemp: 2019 Industry Outlook and its definitive research, market intelligence, investments analysis, survey results, data charts, and insights form industry leaders.
For now, readers should note that leading hemp companies are not currently in mass-market retailers like Walmart, Whole Foods, Target, or Costco. Yet, their revenues are already competitive versus the world’s leading cannabis companies. Now, the Farm Bill arrives to give hemp companies access to the largest retailers in the United States. Cannabis/marijuana-only companies will continue making investments and doing M&A deals with the hemp companies to develop their supply chains and reduce their ingredient cost by cultivating and processing cannabinoids from hemp.
Projected Annual Hemp Market Growth
12020: $1.1 million
22021: $1.6 million
32022: $1.9 million
What remains to be seen are the precise stances adopted by the FDA and DEA on the new policies. The industry should watch closely for any kind of public announcement or comment from the FDA to signal precisely how they will regulate hemp-CBD as a supplement: Will they ease regulations in line with the Dietary Supplement Health and Education Act of 1994 (DSHEA), or face backlash from Congress for not following the fullest intentions for the new law? Time will soon tell.
More broadly, the passage of the Farm Bill represents a sweeping change in the balance of power in global hemp markets. The United States has historically been an importer of hemp products from Canada, Europe, and China. Now, with the Farm Bill as its tailwind, the U.S. hemp market will expand to lead the global hemp industry by 2020, representing 32% of a 5.7 billion global market in 2020.
"Now, with the Farm Bill as its tailwind, the U.S. hemp market will expand to lead the global hemp industry by 2020, representing 32% of a 5.7 billion global market in 2020."
As the U.S. hemp industry matures, it will transition from being a seed, textile, and industrial product importer to a global exporter. Until now, the U.S. has lagged behind countries like Canada and France with hemp legislation. With final passage, the Farm Bill aims the industry to accelerate and establish itself as a global hemp powerhouse led by hemp-derived CBD.
“Though the passage of the Farm Bill is incredible news, it is similarly important to remember the work left to be done, which will of course take time — months, if not more than a year — to roll out,” cautioned Hoban Law Group in a statement.
“We look forward to rolling up our sleeves and continuing to work alongside hemp industry stakeholders and government officials in ensuring appropriate and sensible regulation at federal, state and local levels. The opportunities many in the industry have long awaited are at the cusp of being realized and this landmark announcement will certainly go down as a seismic policy shift in our nation’s history,” the firm concluded.
Over the last year, the hemp industry has experienced explosive growth, with most of the best of breed hemp “pure play” public companies experiencing double-digit growth.
CV Sciences (OTCMKTS: CVSI) experienced a 35% increase in revenue during the second quarter, followed by a slightly more modest 8% growth in the third. Charlotte’s Web Holdings (CWBHF) increased its revenues 6% in the third quarter, to a hemp industry-leading $17.7 million. With passage of the Farm Bill, such hemp companies will look to penetrate mass market retailers.
