Hemp Benchmarks Archives - Green Market Report

Debra BorchardtJanuary 3, 2022
Seed.jpg

10min00

Hemp prices remain depressed causing hemp farmers to decide against planting crops for 2022. Hemp Benchmarks reported that December pricing for hemp crops remained in the doldrums as past overproduction led to too much supply and not enough buyers. Despite some promising end markets, the demand just isn’t enough for the farmers to take the chance. In addition to the low prices and oversupply, the hemp market is also facing supply chain issues like increased trucking costs. Plus, other crops like corn and soybeans have experienced price increases prompting some farmers to abandon hemp.

There are big hopes for industrial hemp fiber, but that market is also hobbled by a lack of processing facilities and a lack of industry standards. There are no government guidelines for hemp fibers like there are for say cotton, which has had standards defined since 1918. 

Price Declines

Delta-8 cannabis had been seen as the saving grace for hemp farmers when CBD product demand wasn’t able to keep up with the supply. However, several states began banning Delta-8 as the product faced little regulation. Hemp Benchmarks wrote, “The observed price for Delta-8 THC Distillate declined for the sixth consecutive month, slipping 4% from November to average $839 per kilogram in December. The low end of the reported price range fell to $450 per kilogram, down from $650 per kilogram in November. The high end of the observed price range declined as well, from $1,200 per kilogram in November to $1,100 per kilogram this month.”

The Benchmarks also posted the following prices for CBD:

Greenhouse-Grown CBD Flower (Bulk) 

  • Average $384 per pound (down 2% from November) 
  • Low – High: $80 – $700 per pound 
  • The average price is 44% higher than the overall 

CBD Flower spot price. Outdoor-Grown CBD Flower (Bulk) 

  • Average: $156 per pound (up 2% from November) 
  • Low – High: $50 – $400 per pound 
  • The average price is 41% lower than the overall CBD Flower spot price

Reduced Acres

Colorado was once one of the biggest states for hemp production is a prime example of the reduction of hemp acres being planted. The 2022 Colorado Business Outlook published in December even addressed the hemp market in its report. It wrote, “Hemp, which experienced a huge boom when first legalized as a commercial crop, has dropped from 2,000 registered Colorado growers in 2019 to about 500 in 2021, and from 87,000 acres to 21,000. Growers cite the lack of a market and processing facilities for hemp fiber and competition from other states legalizing industrial hemp, creating an abundant supply on the market. State government support for hemp remains strong, and there are still many ardent supporters of the crop. The Department of Agriculture continues to work on development projects for hemp flour, fiber, and other uses.” 

Farmers also faced extreme weather conditions. The west has experienced massive wild fires in Calirfornia and Oregon. Louisiana and Vermont both drowned in excessive rain, while Texas started the year with a catastrophic cold snap. Hemp Benchmarks also wrote that one veteran hemp cultivator in New York, Allan Gendlemen, told WSHU Radio that he lost one of his six acres to rain in 2021.“This whole thing got completely flooded and the plants literally just died,” he said. “And so now, this is empty field.”

Expensive Travel

If all that bad news wasn’t enough to scare away most hemp farmers, just getting the product to a processing facility also costs more. Hemp Benchmarks said in its December report that hemp logistics company Fide Freight provided data on rates to ship bulk hemp products by truck that showed significant increases in average shipping prices compared to last year. The report said, “As of this month, average rates to move bulk hemp products in a “dry van” from Denver, Colorado to various selected locations increased anywhere from 22% to 94% year-on-year, with the route from Denver to Los Angeles, California seeing the largest jump.”

Regulations Are A Mess

The lack of guidance from the FDA has certainly not helped CBD producers and hemp farmers. Last month New York Representative Kathleen Rice,  Morgan Griffith (VA-09), Angie Craig (MN-02), and Dan Crenshaw (TX-02) introduced a bipartisan bill that would establish federal standards for CBD food and beverage products to protect consumers and provide marketplace stability for farmers, producers, and retailers. CBD companies have faced penalties regarding product labeling and website claims, yet get no direction from the government hampering their ability to promote and sell their products. 

“CBD products are exploding in popularity, but the lack of federal regulation surrounding them has put consumers at risk and left businesses looking for clarity,” said Representative Rice. “The bipartisan CBD Product Safety and Standardization Act will establish the clear regulatory framework needed to provide stability for business and ensure unsafe products stay off the shelves.” The bipartisan CBD Product Safety and Standardization Act would allow FDA to regulate CBD as it would any other food ingredient and subject these products to enforceable safeguards to ensure accountability. It also charges the agency with establishing CBD content limits and packaging and labeling requirements and determining in which categories of food CBD is appropriate for use. 

“We strongly support requiring the FDA to regulate hemp extracts like CBD as food and beverage ingredients,” said Jonathan Miller, General Counsel, U.S. Hemp Roundtable, the hemp industry’s national advocacy organization.  

States have also complicated the regulatory landscape with whipsaw decisions around Delta-8. Texas for example tried define Delta-8 as a schedule 1 substance causing retailers to fight back winning a lawsuit that temporarily lifted the ban. However, an appeal was filed causing the ban to go back into enforcement. The fate of Delta-8 in Texas is now mired in the courts. 

Promising Markets

Hemp farmers remain optimistic even in the face of so many obstacles. Even as CBD demand flattened, the projected market for hemp fiber and grain is $32 billion by 2030. Hemp Benchmarks wrote that Melissa Nelson-Baldwin is co-owner of South Bend Industrial Hemp in Kansas and that the company has been growing hemp grain and fiber since 2019 and opened its processing facility this past June. “NelsonBaldwin told Hemp Benchmarks that their decortication facility, believed to be the first of its kind in the Midwest, has been busy ever since it was first switched on. Business for hemp fiber, she said, has ‘grown exponentially. There was none three years ago, and now I need three shifts at my facility.’” 

Many believe that industrial hemp will be a bigger market than the diet supplement market. The National Hemp Association wrote in its Economic Impact report, “The average hemp fiber & grain processing facility employs 117 people, with an annual payroll of $6.1 million. The total economic output attributed to a single processing facility is estimated at more than $30 million.” It went on to say, “By 2030 industrial hemp can account for over $9 billion of economic output in rural areas.” 

So, the potential promise of hemp keeps many in the industry focused even as the current environment remains difficult. It looks as if only the strong will survive and growing hemp is definitely becoming a labor of love.


Julie AitchesonDecember 7, 2021
2021-2.jpg

5min00

With December upon us and hemp harvest season coming to a close, the cannabis industry is facing a sobering bust following the great CBD boom. The November 2021 Hemp Benchmarks Report contains results from an analysis of financial findings from publicly traded CBD companies, which reflect a stagnant 2021 market. However, hemp-derived THC (Delta-8) companies are seeing solid revenues despite some decline in wholesale prices. This was the case for LFTD, which saw $29 million in combined sales in the third quarter, while longstanding hemp CBD company Charlotte’s Web (OTC: CWBHF), which has the largest U.S. market share, reported a revenue decline of 6% year-over-year. Other publicly traded CBD companies such as cbdmd and CV Sciences reported similar trends.

Wholesale prices for various types of extracted CBD continue in a downward trend and, according to Hemp Benchmarks, the amount of hemp acreage planted and harvested successfully this year declined by roughly half compared to 2020.  The glut of hemp biomass and hemp-derived CBD products in the market, lack of growth in demand for non-intoxicating cannabinoids and the rise in popularity of synthetics manufactured from hemp-derived CBD point to more trouble ahead for CBD product sales. Other impacts include regulatory uncertainty and a drop in consumer spending due to the coronavirus pandemic. 

Still, a recent U.S. CBD Market Industry Update published by the Brightfield Group projects significant sales growth for CBD in 2022, with a holiday season jump and a possible boost from the passage of California Assembly Bill 45, which formally legalizes CBD production and sales in the state while also allowing it to be added to foods and marketed as a dietary supplement. This, coupled with the possibility that California may decide to restrict the sale of Delta-8 THC products to companies with state-issued marijuana licenses, may give non-intoxicating CBD products a much-needed lift in the market.

An increase of interest in hemp fiber and grain offers some reassurance to hemp farmers as well. In December, the National Hemp Association submitted a requested report to the White House predicting that hemp and fiber grain would generate a $32 billion dollar impact by 2030. As a crop that sequesters carbon dioxide and creates nutrient-rich soil (and therefore nutrient-rich produce), hemp shows great promise as a rotational crop among farmers who currently rotate corn, soy, and wheat. Meanwhile, hemp fiber has the potential to serve as the basis for thousands of products throughout the supply chain. 

The success of hemp fiber and grain will require a considerable investment of time, resources, education, and promotion and is not without challenges, but as big brands like Georgia-Pacific, Nike, and Patagonia announce initiatives to make hemp-based products, the wheels are already turning in hemp fiber’s favor. Farmers growing hemp fiber and grain can buy certified seed to minimize their risks (an option which does not exist for CBD plant seed), and the availability of contracts for growing hemp for both fiber and seed is increasing as manufacturers research more ways, both old and new, to make use of this versatile plant.

 


Julie AitchesonNovember 1, 2021
hemp_field.jpg

5min00

Hemp Benchmarks has released its October report, with notable points including a 4% decline in observed prices for delta-8 THC distillate for the fourth consecutive month while sales numbers for this controversial cannabinoid made from hemp remain robust. This mirrors an overall dip in rates for CBD distillate, which is at an all-time low despite larger-volume deals. Newcomer delta-10 THC makes an appearance in the Hemp Benchmarks’ report for the month of October, though it is still unfamiliar to many consumers. 

Delta-10, closely related to delta-9, is one of the THC compounds found in hemp and cannabis that is responsible for making consumers feel high or euphoric. While delta-9 is more likely to have an effect on pleasure and memory and delta-8 is often used as a relaxant and sleep aid, some claim that delta-10 enhances energy, creativity, and productivity. (Little is factually known about how this cannabinoid functions in the body or what its effects are.) Unlike delta-9, delta-10 is only found in trace amounts in plant material and requires large amounts of plant matter and significant processing to extract a potent quantity. It exists in the same legal grey zone as delta-8 when derived from hemp and therefore is typically available in states where recreational use is illegal, though this is starting to change. According to Hemp Benchmarks, delta-10 THC Distillate averaged $3,580 per kilogram in October, which is more than four times the average price for delta-8 THC distillate. 

The FDA issued warnings about Delta-8 THC in September, which remains especially popular in states where recreational marijuana use is illegal. Since then, restrictions or all-out bans on delta-8 are being initiated that will likely affect sales of delta-10 as well. Both South Carolina and Texas have taken steps to articulate state-specific policies, with South Carolina Attorney General Alan Wilson issuing an opinion that the state’s Hemp Farming Act “does not provide an exception for, and does not legalize, delta-8 THC or any other isomer of THC in itself.” 

The Texas Department of State Health Services released an October update which specified that “all other forms of THC, including Delta-8 in any concentration and Delta-9 exceeding .3% are considered Schedule 1 controlled substances.” This is not settling well with some Texas retailers, who pushed back and petitioned for a temporary restraining order against the ruling. The restraining order was denied by a state district judge, rendering delta-8 illegal in Texas, at least for the time being. Meanwhile, the Michigan Department of Agriculture and Rural Development issued its own statement that beginning on October 11 “it is illegal for businesses to manufacture, possess, transfer, inventory, sell or give away delta-8 THC or THC-O acetate (a synthetic cannabinoid said to be more potent and have longer-lasting effects than regular THC) without proper licensing from the Marijuana Regulatory Agency.”

Despite this ongoing controversy, growers are dedicating larger portions of their operations to hemp cultivation for extraction and conversion to synthetic cannabinoids as the demand for them continues to rise. The swift rate at which new cannabinoids are being synthesized and new restrictions being issued around their sale and use bodes ill for stability in this corner of the market, though there is no arguing that demand is high, prompting producers to race ahead in search of the next big thing in synthetics.


Debra BorchardtAugust 30, 2021
hemp-2.jpg

6min00

As hemp prices continue to fall, farmers are leaving. When the Farm Bill of 2018 passed, farmers rejoiced at the ability to legally grow hemp. Visions of massive demand for CBD products caused farmers to plant thousands of acres. Indeed, it seemed a sure-fire thing. Seemingly overnight numerous products on retailers’ shelves had some version with CBD included. Body products, foods, and supplements all touted the benefits of having CBD added. Then it all fell apart as several problems combined to crash the market.

The problems ranged from a lack of guidance from the FDA, falling prices, less demand for CBD than expected, weather-related issues, and a pandemic. The crops planted in 2019  led to a glut of biomass that persists today. Farmers that were unable to make any money have left the business leaving only the truly committed. 

Price Crash

The glut of biomass caused the prices to slide as the market worked its way through the supply. Hemp Benchmarks’ latest August report wrote, “CBG Biomass and extracted CBG products also saw their observed wholesale prices continue to slide this month. In regard to Crude CBD Oil, Hemp Benchmarks observed USDA Certified Organic and THC Free product that helped to buttress the category’s spot price somewhat, but this month’s assessed price for Crude saw an overall decline on an increase in the frequency of reported deals settling under $100 per kilogram.” Indoor-grown CBD flower is down 3% from July, greenhouse-grown CBD flower has dropped 5% from July and only outdoor grown CBD flower saw its price rise by 7% from July according to the Benchmarks data.

One example of the drastic fall in prices comes from North Dakota, where Veronica Michael told the Hemp Benchmark, “When we first started extraction [in the spring of 2019], crude had been around $1,400 [per kilogram],” she remembered. “I got a call from two buyers in the last two weeks. One was in Colorado and one was in Washington. Both were offering from about $80 to $120 [per kilogram] for crude. That’s ridiculously low. When you look at distillates and isolates, the numbers aren’t good either. People want to buy distillates and isolates for less than we can make them for unless you’re a really big producer. It makes me nervous and scared for the future.”

Farmers Leaving

Hemp Benchmarks reported that it counted 10,881 hemp farming licenses issued nationwide for the 2021 season, down 45% from 19,799 hemp cultivation licenses documented in 2020. Brett Eaton, CEO and founder of Green Cherry Organics in Fort Collins, Colorado Told Hemp Benchmarks that “24 of the 28 hemp farmers he works with regularly are not planting hemp this year. Eaton’s company created the first USDA-certified organic hemp greenhouse in the United States. It also sells its CBD products and clones nationally, and works with hemp farmers in 11 different states.”

With no one to buy the hemp or prices so low that it doesn’t cover the expense of growing, many farmers returned to more traditional crops whose prices have soared. Corn and wheat crops affected by droughts have seen prices at three-month highs. The droughts in some areas contrast with overly heavy rains in other areas. The market has also seen a shift where hemp is being planted. Colorado hemp acres have fallen from 2020 to 2021, while Texas and Illinois have dramatically increased planting. Oregon, which has been a big state for hemp farmers, is seeing those acres face the criticism that the hemp plantings are masking actual illegal THC heavy cannabis farming. 

Outlook

For now, the outlook remains challenging. Many of the farmers cited in the August Hemp Benchmark report said that if the FDA would settle the issues around hemp regulations the market could recover. However, the FDA seems to be punting back to Congress and isn’t moving to take a stand. No one can do anything about the weather or pandemic forced quarantine issues. The industry could be helped by consolidation, but that doesn’t look to be happening. The THC side of the cannabis industry is awash in M&A deals, but the hemp side has just seen businesses close versus being acquired or merging. 

One thing that could help with the 2019 glut is that some of the remaining product is now turning brown and moldy. That suggests that at some point CBD brands will need to buy new CBD products and with fewer farmers planting less acreage, prices would surely rise. Still, the hemp farming industry is clearly becoming one for long-term players. It is not the quick turn on investment that the THC cannabis industry enjoys. 


Julie AitchesonAugust 3, 2021
hemp.jpg

5min00

July 2021 saw record-setting temperatures in parts of the country, alarming spikes in Delta variant Covid infections, and large numbers of Americans returning to summer vacationing after having last summer’s dreams of ocean breezes and lakeshore barbecues dashed by the pandemic. It was also a notable, if not promising month for hemp. Hemp Benchmarks, a division of New Leaf Data Services and leading provider of financial, business, and industry data for the North American hemp markets, recently issued its report for July, which touches on some of the most high-profile talking points of the hemp market to date.

Wholesale cannabis prices have been experiencing a steady decline overall, with the exception of Crude CBD Oil and Broad Spectrum CBD Distillate. These products saw modest price rises in July but still fell short of the prices they topped out at a few months ago. There have been increases in transaction frequency and volume for CBD Biomass and extracted CBD products thanks to strong demand for delta-8 THC, which is synthesized from these products, but this has not been sufficient to move the needle on prices. Despite a steady demand, assessed prices for Delta-8 THC Distillate and Smokable CBD flower both dropped for the second month running, with indoor and greenhouse-grown products earning higher rates from buyers.

Delta-8 Demand

You might wonder why, with its steady-and-still-growing demand among consumers, Delta-8 THC has not been the rising tide that lifts all boats in terms of hemp sales. It may be due in part to state-by-state regulations and restrictions regarding its sale and use. As of July 1, The Connecticut Department of Consumer Protection established that businesses may no longer offer or sell products made using hemp or hemp-derived products with any concentration of THC, including deltas-7,8,9 and 10. A Senate bill signed into law on June 22, 2021 affirmed that products containing deltas-7,8,9 and 10 may only be sold by licensed cannabis retailers or medical marijuana dispensaries. New York has instituted similar restrictions. Delta-8 is also facing some opposition in states with legal cannabis markets as it is cheaper to manufacture than cannabis, is not taxed, and is cheaper to produce.

On the agricultural side, there has been an ongoing decline in the amount of acreage devoted to hemp production in 2021 due to farmers downsizing operations, fewer startups, and those who have cultivated in the past choosing not to grow this season. Meanwhile, existing hemp acreage endured threats posed by extreme weather conditions and the continued onslaught of Covid-19. 

In better news, fiber hemp is getting increased interest from farmers this year as a less volatile corner of the hemp market, being less prone to fluctuation due to changing regulations governing its use. Innovations in the industry abound as interest surges, such as the development of more precise and efficient processing equipment and proprietary technologies that meet the unique needs of customers. This is not to say that no hurdles exist, including developing cultivars that produce higher yields to make fiber hemp economically viable for farmers and the lure of growing other more financially rewarding row crops over hemp. And while there is less controversy around fiber hemp as opposed to hemp grown for CBD products, there is still a strong need for uniformity of regulation between states and better infrastructure in order for this market to flourish. 

The overall decline of the hemp market points to dramatic consolidation, a trend borne out by new data from The Brightfield Group revealing that the number of brands in the CBD industry has dropped from 3,500 at the end of 2019 to 2,000 today. Still, with new innovations on the rise and Delta-8’s stubborn but steady ascendance, there is hope that the rebound of the hemp market will not be a matter of “if” but “when”.

 


Debra BorchardtJuly 29, 2021
hemp_field.jpg

9min00

Delta-8 and smokable flower are the two products keeping hemp framers alive. The regulatory loophole that has allowed Delta-8 to be sold legally is also causing legal confusion. Delta-8 is a cannabis product that can be derived from hemp, but still give the consumer a light psychotropic experience. Some states have issued restrictions around the product, while others haven’t addressed it at all. Either way, the demand has been a blessing to hemp farmers who planted lots of acres in 2019 expecting a surge in CBD products, only to see the market contract and prices plummet. 

Hemp Benchmarks reported that after rising 4%in May, the average per-kilogram price for delta-8 THC distillate fell 1% in June to $1,215. “Notably, both the low and high ends of observed transaction data – $900 and $1,650 per kilogram – were up compared to May.”

In Georgia, Reginald Reese of Green Toad Hemp Farm told Hemp Benchmarks that delta-8 THC was here to stay. “The beauty of it is, Georgia refused the [delta-8] ban,” he said. “We have the right as licensed hemp growers to use every part of that hemp.” Reese also told Hemp Benchmark that he believes efforts to ban delta-8 THC are part of a “full-court press” from the businesses participating in licensed, state-legal marijuana industries, which do not want the competition. 

Smokable Flower Grows

The other product that has been welcomed by the farmers is smokable flower. The Benchmark reported that as of June 2021, the number of square feet registered for indoor or greenhouse hemp production – which is typically for the purpose of producing smokable CBD flower – is up significantly relative to last year. “Hemp Benchmarks has documented over 168.2 million square feet registered for indoor or greenhouse production. This figure is up 328% compared to over 39.5 million square feet recorded in June 2020 and up 85% from over 90.8 million square feet ultimately documented by the end of last year.”

It seems farmers are leaving the outdoor growing and focusing on indoor growing in order to fulfill smokable flower demand. The Benchmark report documented that smokable CBD Flower has maintained its value in the U.S. hemp wholesale market better than perhaps any other hemp-CBD product. “Flower grown indoors or in greenhouses also typically commands a premium price compared to that cultivated outdoors.”

The Benchmark report said that smokable CBD Flower saw its average price decline in June after cresting above $300 per pound in May. “Despite some reports of still-stagnant demand for CBG, the price for smokable CBG Flower rose 15% in June to average $326 per pound, exceeding the price for its CBD counterpart. The significant increase in the assessed price for CBG Flower this month follows an over 50% jump observed in May.” This shift away from biomass and towards flower farming could potentially stabilize the biomass market. A reduction in supply could help wholesale prices. 

Grasshoppers?

The problems affecting hemp crops this season could end up helping reduce the glut of hemp inventory. Excessive heat and drought in the western part of the U.S. have affected hemp farmers. Wildfire threats and water reductions have also conspired to challenge hemp farmers. And if that wasn’t bad enough – it seems grasshoppers love warm, dry weather. 

Last year, farmers fought grasshopper infestations and it looks like this year conditions are ripe for an even bigger outbreak. The Hemp Benchmarks June report noted that the U.S. Department of Agriculture is said to be taking steps to mitigate damage to crops and rangelands by spraying pesticides in areas where infestations are likely to occur, including roughly 3,000 square miles of Montana, which is home to significant hemp production, primarily for grain. 

Less Hemp Acreage

Hemp Benchmarks reported that there is less hemp being grown as farmers head into the 2021 season. Several reasons have caused the less than stellar outlook for the market. A glut of biomass and CBD caused a plunge in prices reducing the profitability of the crop. Farming more mainstream products have become a better investment. The hemp market has also been affected by a lack of regulatory guidance has also caused farmers to back off from planting more acreage. 

Hemp Benchmarks said it has documented the following hemp production licensing and acreage data for 2021: 

  • 8,298 licenses issued (down 8% from 9,066 counted in June 2020; down 58% from 19,799 ultimately documented for 2020); 
  • 107,702 acres registered for outdoor production (down 55% compared to 236,732 acres documented in June 2020; down 75% from 429,300 ultimately documented for 2020).

CBD Collapse

It seemed that almost every product on the retail shelves had some form of CBD in it. Food, beauty products and supplements popped up on every retail counter. The future looked bright for hemp farmers, but the demand didn’t follow at the expected levels. Thousands of CBD companies sprang up overnight and the flood of products created a confusing and competitive landscape. 

A new Brightfield Group report says that the CBD industry has lost more than 1,000 players in the past 12 months—some through corporate consolidation and others to bankruptcy. Hemp Benchmarks also quoted farmers who said that there was a lot of low-priced inventory on the market due to bankrupt companies. Earlier this year the Phoenix Business Journal reported. that Integrated AG, the parent company of Integrated CBD, filed for Chapter 11 bankruptcy protection on Jan. 20 and disclosed over $20 million in outstanding debt. 

Despite all the negative news, last month California-based Kadenwood, a privately held CBD consumer packaged goods company, completed a $30 million cash Series B capital raise. The company said it will use the money to buy advertising and acquire more companies. Kadenwood said the raise also includes a $20 million media campaign to raise brand awareness, bringing the total value to $50 million.


Julie AitchesonFebruary 22, 2021
Delta-8.jpg

4min00

According to the January 2021 Hemp Benchmarks report, there is an increasing demand for delta-8 THC, which is not derived from hemp plant material but synthesized from extracted CBD. This is helping drive sales of crude CBD oil, CBD Isolate, and some wholesale CBD products. As the popularity of delta-8 THC increases, Hemp Benchmarks observed a consistent decline in prices. Despite the fact that trading volumes of delta-8 THC remain a small proportion of those for CBD products, it is the fastest-growing product in the hemp sector as of the January report. A Tennessee processor told Hemp Benchmarks that they have seen as many as about 20% of their CBD customers shift to purchasing delta-8 THC.

This growth is notable given the many unresolved questions regarding delta-8’s legality. The compound is a psychoactive cannabinoid, which means it can get users “high”, giving rise to numerous legality issues. Newly proposed regulations from the Drug Enforcement Agency would classify delta-8 THC as a Schedule I controlled substance, which would make it illegal at the federal level. For this reason, laboratories and manufacturers are keeping a restrained and realistic eye out for delta-8’s true market potential. The uncertainty extends to the lack of defined standards around compliance and purity of products containing delta-8 THC. The Hemp Benchmarks report quotes an email from Stephen Crowley, Compliance Specialist and Hemp Processing Technician with the Oregon Liquor Control Commission, who wrote that one of his concerns is “what else might be in these products other than delta-8 THC.” This includes a number of chemical impurities that can be generated during the isomerization process.

If the proposed DEA regulations go into effect, delta-8 THC synthesized from CBD would be illegal and its popularity among manufacturers would hit a major roadblock. Until regulations are finalized, The Hemp Benchmark report predicts that some processors might entertain the idea of synthesizing delta-8 THC from their surplus CBD and selling it for significantly higher prices in order to recoup losses from declining CBD and CBG extract prices. 

The consumer market for delta-8 may correlate more strongly with the delta-9 THC demographic as they are both psychoactive, which may limit the delta-8’s appeal for the broader CBD consumer base. As a “novel cannabinoid”, delta-8 THC education and promotion will be necessary to ensure that it does not see the same fate as CBG, which has not generated sufficient interest to purge the excess inventory of what was supposed to be the cannabis industry’s newest rising star. From February to August 2020, the price for CBG Biomass dropped by a staggering 82 percent.

Delta-8 THC is currently a bright light in a stumbling market. Whether or not it can sustain that upward trajectory is dependent on which way the regulatory wind blows once the grey areas in the 2018 Farm Bill are clarified regarding synthetically-derived forms of THC. Until then, this controversial compound is making its way into all manner of products on the hemp market, and earning top dollar for those willing to take a chance on its uncertain future.

 


StaffAugust 25, 2020
HEMP.jpg

3min00
Hemp Benchmarks recently released its July 2020 report reviewing wholesale prices for the hemp industry. The group found that price assessments in recent months have shown stabilizing rates for numerous wholesale products that are part of the hemp-CBD supply chain. “For example, from April through this month the aggregate price for CBD Biomass and wholesale prices for smokable bulk CBD Flower have both steadied. While the downward trend in CBD product prices has largely subsided in recent months, that for CBG biomass and extracted forms of the cannabinoid has continued.”

Crop Declines

Hemp Benchmarks also found that the 2020’s licensed acreage declined by over 30% from last year, while indoor and greenhouse square footage registered for hemp cultivation is down by roughly 64% year-over-year. “These numbers bear out what we have reported earlier this year, that many farmers are taking a more conservative approach to cultivation, if not exiting the sector entirely. The just over 18,000 cultivation licenses that we have counted nationwide to this point in 2020 represents about an 8% decline compared to the over 19,500 recorded in 2019. This indicates that most growers registered smaller outdoor plots or indoor / greenhouse sites.”
The report also said that overall, the reduction in licensed acreage, entrance of a significant amount of new farmers, tough market conditions, and difficulties related to the COVID-19 pandemic suggest that total U.S. hemp production for 2020 could decline substantially year-over-year, particularly in regard to how much CBD or other cannabinoid-rich biomass is generated.
“In our June report, we analyzed data on costs to transport hemp and hemp products. We also pointed out that such costs can change based on a variety of factors. This month, hemp transportation costs were on the rise in July due to fallout from the COVID-19 pandemic.” Jon Wilcox, co-founder of hemp transportation company Fide Freight, attributes the rise in shipping costs to states across the country reopening after coronavirus-motivated shutdown orders. He stated, “It is assumed that shippers are trying to make up for lost time and … make as much money as possible due to short-term uncertainty.”
Additionally, U.S. ports are overloaded with goods that shippers are trying to move. This has resulted in bidding wars for trucks.

Cynthia SalarizadehApril 24, 2019
HEMP.jpg

3min00

New Leaf Data Services, LLC (NLDS), the cannabis and hemp industry’s only independent Price Reporting Agency, has officially launched a pricing vertical for hemp called Hemp Benchmarks®.  It is now collecting, assessing and reporting on the wholesale price of biomass, dry flower, clones, seeds, crude hemp oil, refined hemp oil and CBD isolate.

As hemp is considered the future for the cannabis plant as a global commodity, the launch of this platform is a major step in the right direction. This signals to Wall Street that the commodity is ready for prime time trading.

“With the passage of the 2018 Farm Bill last year, the hemp market is poised for massive growth with unprecedented interest from farmers, processors and consumers, fueled in part by the extraordinary demand for CBD-based products. Industry participants will be seeking price transparency to analyze and navigate what we believe will be a dynamic and chaotic market as the projected supply and demand for hemp and hemp derived end-products comes into focus over the next few years.” said Jonathan Rubin, CEO of NLDS. “We are pleased to offer the market another independent reference benchmark to support strategic, operational and investment related decisions.”

These new assessments expand NLDS’ portfolio of benchmarks, which include more than eighty weekly benchmarks covering the wholesale price of cannabis in legal U.S. and Canadian markets through its Cannabis Benchmarks® division.

“We expect volatile hemp and CBD markets until supply and demand reach an equilibrium,” noted Rubin. “Price Reporting Agencies play a critical role in managing risk associated with volatile markets, enabling buyers and sellers to transact with confidence, support fundamental analysis by investors and equity analysts, and provide definitive benchmarks for commodity traders.”

 


StaffApril 24, 2019
img_hempbenchmarks.jpg

3min00

STAMFORD, Conn., April 24, 2019 /AxisWire/ New Leaf Data Services, LLC (NLDS), the cannabis and hemp industry’s only independent Price Reporting Agency, has announced that Hemp Benchmarks® is now collecting, assessing and reporting on the wholesale price of biomass, dry flower, clones, seeds, crude hemp oil, refined hemp oil and CBD isolate. For more information, please visit: www.hempbenchmarks.com.

In the months ahead, Hemp Benchmarks® will expand its price assessments to cover additional end markets for hemp fiber and grain and begin to report on international markets as well.

“With the passage of the 2018 Farm Bill last year, the hemp market is poised for massive growth with unprecedented interest from farmers, processors and consumers, fueled in part by the extraordinary demand for CBD-based products. Industry participants will be seeking price transparency to analyze and navigate what we believe will be a dynamic and chaotic market as the projected supply and demand for hemp and hemp derived end-products comes into focus over the next few years.” said Jonathan Rubin, CEO of NLDS. “We are pleased to offer the market another independent reference benchmark to support strategic, operational and investment related decisions.”

These new assessments expand NLDS’ portfolio of benchmarks, which include more than eighty weekly benchmarks covering the wholesale price of cannabis in legal U.S. and Canadian markets through its Cannabis Benchmarks® division.

“We expect volatile hemp and CBD markets until supply and demand reach an equilibrium,” noted Rubin. “Price Reporting Agencies play a critical role in managing risk associated with volatile markets, enabling buyers and sellers to transact with confidence, support fundamental analysis by investors and equity analysts, and provide definitive benchmarks for commodity traders.”

About Hemp Benchmarks®
Hemp Benchmarks® is a division of New Leaf Data Services, LLC. Our mission is to bring price transparency and efficiency to cultivators, processors, distributors, investors, traders and other hemp market participants through validated, standardized wholesale price benchmarks and market intelligence.

Media Contact:
support@newleafdataservices.com
(888) 502-7298


Get the latest cannabis news delivered right to your inbox

The Morning Rise

Unpack the industry with the daily cannabis newsletter for business leaders.

 Sign up


About Us

The Green Market Report focuses on the financial news of the rapidly growing cannabis industry. Our target approach filters out the daily noise and does a deep dive into the financial, business and economic side of the cannabis industry. Our team is cultivating the industry’s critical news into one source and providing open source insights and data analysis


READ MORE



Recent Tweets

Get the latest cannabis news delivered right to your inbox

The Morning Rise

Unpack the industry with the daily cannabis newsletter for business leaders.