As might have been predicted, the in-rush of farmers looking to cash in on hemp as a new crop lead to a severe drop in prices. Many farmers who went all-in on a make or break effort are coming up broke, and are now desperately trying to pick up the pieces.
The prices for CBD are continuing to remain low even as the winter drags on. In Colorado, the price for CBD is the highest at $0.72, while the midpoint in the Great Plains is hovering at $0.62. That compared to a price the same time last year of $3.50. The numbers reflect the price that is paid per percentage point per pound. That means that an average crop that contains 10% CBD by dry weight is now fetching $7.20 per pound right now as opposed to $35.00 last year.
Caused by the boom in supply, this crash in price has made it a buyers’ market, and many brokers are taking advantage. With the upper hand, some brokers are making decisions based solely on price, and they are raking in the profits as farmers make a race towards the bottom to unload their crops.
The other reason for this hardship is that regulations are still catching up to the burgeoning industry. The uncertainty that the federal government is creating with its current ambiguity is stirring the pot even more. Laws will have to evolve and evolve quickly to keep up. Especially when the crop completely switches jurisdictions from the USDA when the crop is being grown to the FDA when it is being consumed.
These temporary setbacks are a long ways from killing the industry, however, with work underway to accept hemp as animal feed, and the infrastructure being built up to create many other products from hemp biomass, the viability of the crop will continue to grow for those farmers who make it through the gauntlet.