As of June 2021, there’s a lot happening in hemp markets. This goes beyond the usual talk of CBD and hemp oil. Crude may still be king, but hemp fiber and hemp grain are getting into position to make a big splash for the industry.
At least that’s what Jason Sirotin, CEO at Arbor Vita8 and Seth Boone, VP of Business Development at PanXchange are speculating in this episode of the Arbor Vita8 podcast.
Here’s the latest in three very important areas when it comes to hemp markets.
Crude continues to take a big price hit as processors are still pushing through inventory from 2019. To say there’s a surplus is an understatement, but volume is going down which will soon mean a return to ‘normal’ when it comes to pricing.
At the very least, prices are tightening up even if they remain on the low side. Expect to see slight increases even as 2019 inventory is still getting sold. Once the inventory is clear, prices should rise more steadily.
These are broad speculations, but trying to get down to the nitty-gritty with price is hard, according to Boone, who cites inadequate volume data to make market trends clear. Without that information, it’s hard to cover the velocity of the market.
Waiting for numbers, and data, to improve, some processors are holding on to their existing inventory of crude. This may prove to be a solid strategy, but why not consider sending your hemp overseas?
International crude pricing
In the European Union, crude pricing is more reflective of what U.S. processors want to see. This is especially true for products like crude and isolate.
In Japan, hemp is still so new their rules and regulations make prices incredibly high. All incoming product must be t-free and only composed of seeds and stems. They’re not even marketing the other cannabinoids right now like CBC, CBN, or CBG. All their focus is on CBD, but to get decent amounts from just seeds and stems you need a lot of product. This drives prices way up.
Hemp fiber is the buzzword on everyone’s lips. We’re all waiting for big news to drop to make hemp fiber relevant, says Sirotin as he and Boone share industry rumors.
#1: There could be an auto manufacturer out there considering the use of hemp fiber to make a specific car part.
#2: The military may be testing hemp bast to replace the current material for their uniforms.
Rumor #2 has the most potential right now. Hemp bast is extremely strong, so making clothing from the fibers would greatly improve the quality of our military uniforms in a variety of capacities.
If any of these rumors prove true though, hemp fiber, as an industry, could change dramatically, for the better.
Grain is already making inroads when it comes to animal feed. Rich in omega-3 and omega-6, widespread approval of hemp grain into animal feed could make a huge impact. It could even save manufacturers money by replacing the fish oil and flax oil currently used to provide these healthy fats.
The food industry is working hard within this sector already, so we’re seeing changes in some states, while others are actively considering change. The dominoes might start falling in such a way to allow for federal legislation to boost hemp grain into the everyday market.
The most recent development comes out of Montana. They’ve made it legal to use hemp in commercial pet and horse feed. This means any animal not in our food system can ingest hemp in their treats and food as long as it doesn’t have any meaningful traces of CBD or THC.
Keeping an eye on the hemp market
At Arbor Vita8, we love sharing what’s new in hemp markets. Each development means a new market, and new earning potential, for this amazing and versatile crop. As a processor and retailer, staying on top of the hemp industry means we can maintain the right services and sell the right products to appeal to the widest audience. Visit us online to see what we mean.