December 02, 2020

PanXchange Hemp Market Reports – November 2020

In this month’s PanXchange episode, Tom Dermody steps in for RJ Hopp to discuss developments in the hemp markets.

Tom Dermody, Senior Markets Analyst at PanXchange brings a wealth of experience in the hemp industry and currently responsible for hemp grain and the true hemp market – stalks, fiber, or hurd that will be processed into products. He helps determine what the value is in a particular hemp-based product.

Hemp Biomass Pricing

In this month’s report, Tom highlights areas of interest in hemp biomass pricing. He says, Transaction volumes are rising but still limited. Lingering 2019 product still available is creating hesitation for some farmers, and there’s a short window of opportunity to liquidate the older stock.

On 2020 crops, processors report that the average CBD content in hemp has fallen to between 6-8%. He theorizes that there are two reasons for the decline: adoption of new THC compliance regimes and early snow and wildfire impact.

The December PanXchange Hemp Market report will dive much deeper into detail with a forecast of supply and demand of cannabinoid products for the 2021 and 2022 seasons.

USDA Pilot Program Extension

The pilot program was extended to October 2021, but Tom reminds us that we need to be cognizant of the tradeoff. What activities will be pushed down the line until the pilot program is formally ended? Real-time tradeoffs are already happening, most notably, the USDA has extended when production loan eligibility will occur, and that isn’t until the 2022 season. Tom believes this is just the start of other programs that will be delayed as well.

EU Designation on CBD

With our neighbors across the pond making decisions regarding CBD’s public safety claims, Tom believes that we’ll see other laws and legislation to come later this year. Additionally, Tom believes that the growth of the global imports/exports opportunity for CBD increases exponentially. He believes there’s at least a 3-6 month wait before we see any significant movements.

Industrial Hemp & Grains

Tom encourages listeners to sign up for the PanXchange report for the reasonable justification regarding the industrial hemp market (grain and fibers) to eclipse the cannabinoid market in the 2021 season. The 2014 farm bill’s intent was to chip away at the previously import-only market sector in hemp grains and fibers.

Listen to the full report here or wherever you listen to your favorite podcasts!