Last Week, The Cannabis Act was officially passed by the Canadian government. Most of the world has been heavily focused on the new regulations set in place to legalize the recreational use of cannabis for adults but, how does this new bill effect the industrial hemp industry? Largely overshadowed by cannabis, the passing of this new legislation will revolutionize the industrial hemp farming industry for the foreseeable future.
One of the most substantial changes to the industry hemp industry is the following:
“The flowering heads, leaves and branches of industrial hemp will no longer need to be destroyed. Instead, these plant parts may be sold to another holder of an industrial hemp licence or a holder of a licence under the Cannabis Regulations. Please note that you will be required to store these plant parts under conditions that maintain their quality. Also, if intended for sale, these plant parts must be transported, sent or delivered in a manner that maintains their quality.”
Industrial hemp has been legally grown on Canadian soil for its natural fibers to manufacture a wide array of different textiles and its multipurpose seeds to produce cosmetics, nutritious health foods, and hemp seed oil. The Canadian government required hemp farmers in the past to destroy the leaves, flowers, and branches produced from their crops in order to remain compliant. This was essentially was forcing them to destroy a good portion of their operation that could have meant more profit for farmers.
The oil produced from the hemp plants flowers and leaves are rich in what is known as phytocannabinoids. They are all-natural plant based compounds that occur naturally in cultivars of the the Cannnabis Sativa plant. Non-psychoactive cannabinoids, such as CBD (Cannabidiol), can be extracted from hemp and contain a number of varied medicinal benefits. CBD has been found to be successful against inflammation, chronic pain, anxiety, and seizures associated with diseases like epilepsy. The demand for CBD products has been growing exponentially over the past few years.
The Hemp Business Journal has indicated that the CBD market is estimated to grow to $2.1B with a 700% growth rate by the year 2020. These numbers are a astronomical leap from 2017’s top sales of over $200 million dollars in CBD products. As acceptance for the multiple uses for the industrial hemp plant rises, product sales of CBD products are bound to exceed expectations.
The passing of the Cannabis Act opens farmers involved in industrial hemp cultivation to utilize the entire hemp plant, however they see fit. Farmers can either sell the raw bio-mass to properly licensed processing companies or setup their own operation to extract oils rich in profitable cannabinoids themselves. By allowing the extraction of cannabinoids in Canada it will fundamentally change the way the sector and financial markets value the hemp plant.