The past few years have been good for hemp. The cash crop had been outlawed for decades due to its close relation to the illicit marijuana until the 2018 Farm Bill was signed into law. The legislation classified industrial hemp as cannabis with less than 0.3% THC and instructed states and tribes to create their own hemp programs and submit them to the U.S. Department of Agriculture (USDA) for approval.
The state of Texas had its hemp plan approved by the USDA earlier this year, a move that State Agriculture Commissioner called a ‘victory for Texas farmers,’ adding that the state was one step closer to giving its agricultural producers access to an ‘exciting and new crop opportunity.” The Lone Star State will start receiving hemp applications on March 16.
According to Miller, the state has seen an influx of manufacturers and processors. “Basically, it will be two types of processors, one will be CBD oil and the other for fiber. We’ve got both coming.”
As a cash crop, hemp stands head and shoulders above the rest. It’s insanely versatile, with applications ranging from textiles and bioplastics to construction and nutrition. On top of that, it produces over 100 cannabinoids, a group of chemicals that have been found to have potent medicinal properties. THC, the main psychoactive element in marijuana and cannabidiol (CBD) are the main ones.
CBD is a potent natural medicine said to be effective against a variety of ailments, from high blood pressure and anxiety to chronic pain and insomnia. Its structure also allows it to be infused in a wide variety of products, and all these factors have left CBD with great demand. Just a year after legalization, the CBD market is worth millions of dollars in sales, and experts estimate a worth of $20 billion by 2024.
Although Texas growers will now be able to tap into this market, there are fears that it was saturated with hemp last year, leading to a spillover of supply into 2020 that will definitely affect prices, according to Calvin Trostle, a professor and agronomist at Texas A&M AgriLife.
John Kagia, Chief Knowledge Officer at New Frontier Data in Washington concurs. “Where we see some of the most compelling opportunities and applications for hemp are actually on the industrial side. Collectively, the diversity of applications for which hemp could be potentially used represents a very, very significant long term economic opportunity.”
It would be interesting to learn what other applications hemp industry players like HTC Extraction Systems (TSX.V: HTC) (OTCQB: HTPRF) are looking at beyond the extraction of CBD from hemp.
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