USDA Reports Rising Yields and Prices in Hemp Industry After Years of Declines

The U.S. hemp industry, which has weathered years of tumultuous fluctuations, is now showing signs of stability and growth, according to the latest National Hemp Report released by the U.S. Department of Agriculture (USDA).

A Rollercoaster Ride for Hemp Growers

Since Congress legalized hemp in 2018, the industry has experienced significant ups and downs, making it challenging for domestic hemp growers to navigate market uncertainties.

Promising Trends

The National Hemp Report, authored by USDA statistician Joshua Bates, reveals encouraging developments for the hemp industry. This is the first version of the report since hemp was added to the USDA’s national agriculture census.

Pricing Trends and Market Opportunities

The report highlights stable or growing prices and acreage in many states, indicating a leveling out of the market after years of volatility. Notably, outdoor-grown hemp flower saw a significant increase in value, jumping 35% to $241 million last year.

Recovery in Indoor Hemp Production

Indoor hemp producers are also experiencing positive shifts, with prices for clones and transplants soaring by 61%. This marks a welcome change after two years of sharp declines in indoor hemp production.

Niche Markets and Surprising Growth

Even smaller niche markets within the hemp industry, such as hempseeds used for oils, saw remarkable growth. The value of hemp grown for seeds surged by 96%, reaching $2.91 million.

Recovery After Setbacks

While the hemp industry faced setbacks between 2021 and 2022, including declines in acreage and harvested hemp value, the latest report indicates a market rebound. Farmers are adapting to market demand more effectively, leading to reduced unsold inventory.

Demographic Insights

The demographics of U.S. hemp growers largely mirror those of the broader agriculture sector, with the majority identifying as white and male. However, there are differences in age demographics, with a lower percentage of hemp producers aged over 65 compared to the overall farming population.

Sunbelt States Embrace Hemp

Sunbelt states, including Alabama, North Carolina, and Texas, are emerging as key players in the indoor hemp production sector. Favorable climate conditions and agricultural traditions are driving hemp cultivation in these regions.

Optimism for the Future

The USDA’s National Hemp Report paints a picture of resilience and growth in the U.S. hemp industry. With stable prices, increasing acreage, and expanding market opportunities, hemp growers are poised for a more promising future.