by Eric Sandy
Hemp growers must contend with the price drop of an emerging commodities market.
The supply of hemp biomass is skyrocketing in the wake of legalization in the U.S. and with the anticipation of federal regulations late this year. Demand for hemp-derived cannabinoids has helped propel the adjacent extraction market, but analysts and growers are concerned that production is outpacing that consumer interest—leading to a price crash as the 2019 cultivation season has come along.
According to hempbenchmarks.com, there are more than 400,000 acres of licensed hemp cultivation land in the U.S. Not all of that is likely to have been planted this year, but that’s a steep climb from the nearly 80,000 acres licensed in 2018.
Wholesale trading platform and vendor network Kush.com entered the hemp space following the passage of the 2018 Farm Bill. The data that the company pulls in from its exchange can then turn into trends worth watching in the industry. Looking at the hemp extraction market, CBD isolate prices have fallen from a high of $9,470 per kg in October 2018 to $4,133 per kg in August 2019—a decline by more than half in under a year.