Although the hemp and marijuana plants are part of the same Cannabis species, hemp has no psychoactive effects and thus called industrial hemp in the U.S. In December 2018, FDA completed its evaluation of three generally recognized as safe (GRAS) notices for the following hemp seed-derived food ingredients: hulled hemp seed, hemp seed protein powder, and hemp seed oil.
The domestic hemp seed and fiber market is currently over $1.0 billion and the hemp CBD market, currently at $2.0 billion is estimated to grow to over $20.0 billion by 2022. The global industrial hemp market is projected to grow from $4.6 billion in 2019 to $26.6 billion by 2025, recording a CAGR of 34%.
Industrial hemp has been cultivated worldwide for decades and since the early 1990s, numerous countries have established hemp-based R&D and developed commercial production, processing, and distribution facilities. Acreage Holdings, a U.S company has former House Speaker John Boehner, former Massachusetts Gov. Bill Weld and former Canadian Prime Minister Brian Mulroney on it’s board, has agreed to be acquired by Canopy Growth, a Canadian company.
Universities in many states have rapidly moved forward since 2014 to cultivate state-specific varieties, production technologies and developed rigorous procedures to build out the value chain for a hemp-based economy. In New York, the Governor’s office supported this effort by providing over $5.0 million for academic research and an additional $2.0 million for breeding.
Colorado has given out over 2,000 licenses with 85,000 permitted outdoor acres (and 13 million sq. ft. for greenhouses) while Kentucky has over 1,000 licenses with over 60,000 permitted outdoor acres. Nebraska Department of Agriculture approved industrial hemp earlier this year with a short license window allowing for only 10 licenses and approximately 0.5 acres for production research.
Western Nebraska has the ideal growth conditions for this profitable crop. Farm-level economics show returns of about $625/acre for grain, $225/acre for fiber, $867/acre for dual purpose and over $36,000/ acre for CBD dry flower.
Even though the University of Nebraska system has world-class scientists mostly based in Eastern Nebraska, NU’s endowment, tax assessment, corporate partners, foundations and private funds can help fund a state-of-the-art Ag Tech Research + Technology (Innovation Center) of the future here in the Panhandle to advance critical research and industry collaborations and partnerships by licensing technology, pilot processing, production, commercialization best practices, develop start-ups, etc. to support long-term farm-to-consumer economic expansion, in Western Nebraska.’