According to Brandessence Market Research, the hemp industry projections are on a promising trajectory to grow at a promising 16.27% CAGR during the 2021-2028 period. The hemp market forecast estimated that industrial hemp accounted for USD 3.91 billion in 2020. Growing demand for hemp food products, nutraceuticals, beverages, alternative protein sources, among others remain key drivers in regions like North America.
The USDA also announced crop insurance, and incentives like farm loans for hemp market growth. This resulted in major oversupply, amidst a historic downturn in the economy. however, the USDA and industry experts believe the hemp market forecast remains optimistic. For example, the USDA noted that in 2014, acreage hemp production remained zero in most parts of the US, while it increased to nearly 90,000 acres in 2018. Similarly, licensed hemp growers were no more than 300 in 2014, which increased to over 3,500 by 2018.
The legalization of marijuana in 18 states in the United States has increased the promise of already robust growth of hemp market. At its peak, industrial hemp fetched $45-50 per pound in 2018. The covid-19 crisis has had a negative impact on industrial hemp with slowdown in demand. United States Agriculture Department (USDA) estimates farmers can produce as much as 2 to 12 ton dry-stem yields per acre.
Similar estimates are projected in Europe, where farmers produce 3.6 to 8.7 ton per acre. The USDA also estimated that the variable, fixed, and operator cost accounted to be $286 per acre for hemp fibre, $233 for certified seed, and $196 for seed. While these estimates are age-old, the promising new growth due to legalization of marijuana in 18 states is a promising new driver for growth of the industrial hemp markets. The 2018 Farm bill in the US, which removed hemp from a list of controlled substances, also promises a new opportunity for growers around the world to be a part of industrial hemp market.
While marijuana based products have fuelled certain frenzy for hemp production, these estimates also remain misleading. On one hand, due to economic downturn, marijuana sales have not soared as high as initial estimates.
Moreover, conventional uses of industrial hemp including textiles, paper, rope, clothing, plastics, paint, biofuel, insulation, food, and animal feed. Increasingly industrial hemp is also used in construction materials, body care cosmetics, among others. It is also believed that traditional use of hemp was common in medicine across Asia Pacific, and other regions.
Moreover, the prohibition on hemp items resulted in destruction of ancient knowledge in relation to the use hemp products. Despite tremendous damage to its reputation, hemp seed is commonly acknowledged as a good source of protein, fat, and fiber, with high nutritional value. Similarly, traditional oriental medicine also deployed hemp to treat and prevent ailment for thousands of years. The growing interest of hemp in key food categories like nutraceuticals is expected to soar hemp market growth during 2021-2028 period.
The growing demand for hemp products to treat depression remains a major driver along with several other key medicinal industrial hemp benefits.
The industrial hemp market is a fragmented, competitive, and innovative landscape. As industrial hemp production becomes a new possibility for growth, experimentation with hemp-produced food products, cosmetics, construction material continues to grow.
Rising applications in food & beverage, personal care, bio composite, and textile sectors is expected to power industrial hemp market size. Rise in hemp oil requirement due to high essential fatty acids level that alleviate and prevents ailments are the factors adding to growth of the global market from food & beverage industry. Shift in health trends & user sociological towards healthy foods, rising elderly population, and improving personal health will boost growth of the global market. Hemp seeds are employed in margarine, salad oil, dairy alternative, and protein flour due to its favorable nutrient profile. Solid development in food & beverage industry all over the world along with increasing user consciousness associated to essential oils, fatty acids, vitamins, minerals, protein, and fiber content present is expected to add towards product requirement.
Hemp seeds account for the most robust hemp market growth in the near future. Hemp seeds accounted for over 40% of total revenues in 2020. The growing demand for hemp seed cakes, demand for hemp oil, and growing demand for hemp nutraceutiacals remain key drivers of this growth. Furthermore, hemp oil continues to grow in a growing range of daily consumer products including personal care, food and beverages, animal feed derivatives, and personal care.
The hemp fibre are expected to continue their promising application in new areas including paper, home furnishing, insulation materials, construction materials, auto parts, and composites. Hemp fibres are laden with hemicellulose, with high absorbent capacities. These make them ideal for textile application. This application remains one of strongest area of growth for hemp manufacturers with new niche growth in areas like automotives.
The electric vehicle manufacturing, and increasing demand for mileage-driven cars has pushed automakers to bring in new products to produce lightweight cars. Hemp remains a growing prospect for interior décor for new autos, as well as motor vehicle parts.
Hemp hurd or shives is a short wooden fiber harvested from industrial hump. This fiber is cost-effective, and promises diverse applications, thanks to its high-absorbance quality for new applications like animal bedding. The material promises high absorbant properties ideal for soaking animal urine, and promises to hold four-times its initial weight.
CBD is increasingly gaining status as an acceptable treatment for clinical depression, and anxiety. This research remains in its primary stage, and it is often in pre-clinical evidence. However, the research is consistent with traditional appeal of hemp or CBD properties as neuroprotective, anxiolytic, analgesic, and anti-inflammatory, antiepileptic, anti-asthmatic, and anti-tumor. The conventional use of hemp in Asia Pacific as a medicine, and growing use of industrial hemp in treating conditions like depression, among others remains a major promise for hemp market growth.
The industrial hemp market promises robust forecast in North America region. This region is expected to witness highest growth during the forecast period. The legalization of marijuana remains a promising horizon in this market with growing number of individuals in the US remain optimistic about its recreational use. Furthermore, growing research into industrial hemp uses including medicinal, Nutraceuticals, food, and cosmetic products.
The demand for industrial hemp in regions like Asia pacific also remains robust. Asia Pacific is home to various regional herbs, and promises robust growth for natural food based ingredients. The growing demand for industrial hump in the region with its large population remains a bright spot in industrial hemp projections.
|Historical data||2015 - 2020|
|Forecast Period||2021 - 2027|
|Market Size in 2020:||USD 3.91 billion|
|Base year considered||2020|
|Forecast Period CAGR %:||
|Market Size Expected in 2027:||XX|
|Tables, Charts & Figures:||175|
|Industrial Hemp Companies||
Marijuana Company of America Inc. HempMeds Brasil Terra Tech Corp, LLC American Hemp Hemp ,Parkland Industrial Hemp Growers Cooperative Ltd. CBD Biotechnology Co. Botanical Genetics, Inc. American Cannabis Company, Inc. HempFlax B.V. Industrial Hemp Manufacturing, Boring Hemp Company Plains Industrial Hemp Processing Ltd. Ecofiber Industries Operations Valley Bio Limited
|Segments Covered||By Product, By Application|
|Regional Analysis||North America, U.S., Canada, , Europe, Germany, France, U.K., Italy, Spain, Sweden, Netherland, Turkey, Switzerland, Belgium, Rest of Europe, Asia-Pacific, South Korea, Japan, China, India, Australia, Philippines, Singapore, Malaysia, Thailand, Indonesia, Rest Of APAC, Latin America, Mexico, Colombia, Brazil, Argentina, Peru, Rest of South America, Middle East and Africa, Saudi Arabia, UAE, Egypt, South Africa, Rest Of MEA|
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