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Новости/Аналитика

Processes in the North American Hemp Market

11.09.2019

The fact that the hemp industry of the United States in the coming years will surpass in all respects the modern hemp breeding of Canada is completely obvious.

During the reports presented at the international conference “ Hemp breeding 2017 ”, the dynamics of the development of Canadian hemp breeding was already characterized . The pages of the profile electronic publication of Ukrainian hemp breeders in 2011 described how " In the hemp war against the United States, Canada wins by TKO ." How much the situation has changed as of today and what is the essence of certain processes that are already observed in North America, we will try to briefly analyze in this material.

Canada has a 20-year advantage over the United States in the cultivation and processing of hemp. Despite this, the sowing area of ​​industrial hemp in Canada decreased in 2018, as the country lagged behind its southern neighbor in the development of the hemp extracts market - information indicated in a report by the U.S. Department of Agriculture , which highlights the Canadian hemp industry . 

According to the above document, Canada, which has regulated commercial cultivation / processing / sale of hemp since 1998 , has established itself as a world leader in the production of commercial volumes of industrial hemp grain, as well as leaves and inflorescences of medical varieties. Moreover, most of the grown crop is sold in the United States . In particular, more than 70% of the 5400 tons of cannabis export from Canada in 2018 was shipped to the United States , and the remaining part of hemp raw materials was shipped to the EU member states and South Korea.

It is noted that in October last year, Canada changed its rules regarding the possibility of using the therapeutic properties of hemp in order to expand the legitimate use of the plant beyond the restrictions on seeds and the fibrous part of the plant, providing a legal opportunity for the production of Canadian extracts from leaves and inflorescences.

Despite this, the cannabis industry in Canada remains a “strictly controlled federal business business” with limited access to plant varieties with significant therapeutic potential. In particular, it states that “although the new hemp regulations are designed to open up additional sources of income and market opportunities by allowing growers to pick cannabisa flowers and leaves, cannabidiol-rich varieties are still not registered for use in Canada .”

Commenting on the materials prepared by the ministry, co-founder of the American Cannabis and Cannabis Trade Association (ATACH) Michael Bronstein said that “it’s clear that when developing a report on the cannabis industry in Canada, US government officials studied the regulatory framework of a neighboring country, and they think that must be done so that the hemp industry of the United States can compete with the country-northern neighbor. In particular, Canada is a fairly developed hemp market, especially in matters relating to equipment, production of seed material and grain consignments, seed certification - those moments that the USA is actively seeking to develop at the moment. "

Slow development of Canadian hemp breeding

A report from the U.S. Department of Agriculture details Canada's state in various areas of modern hemp breeding, including regulation, trade and industry development, the use of plants in animal feed , and the rules governing the use of non-drug cannabinoids.

While Canada regulated the use of industrial hemp in 1998, hemp plants were grown in the country mainly for use in food . In this regard, the industry has grown quite slowly over the past 20 years, as manufacturers worked primarily to solve agronomic problems, and a fairly limited number of processors developed new product manufacturing technologies and established sales markets.

According to the Canadian Ministry of Health , in 2018, about 31.5 thousand ha of industrial hemp crops were cultivated in the country. However, this value actually decreased from about 50 thousand hectares, which were cultivated in 2017. And this is despite the fact that government officials in Canada allowed hemp crop insurance at the federal level. At the moment, in the United States there is no mechanism for hemp crop insurance at the federal level, and despite this, in 2019, the cultivated area reached about 207 thousand ha. Already now, the fact that the hemp industry in the US in the coming years will surpass Canada’s modern hemp breeding in all respects is completely obvious .

The use of drug-free cannabinoids is regulated

In Canada, the legal regulation of the cultivation / processing / sale of legal psychoactive hemp. At the same time, there is no clear legal and regulatory framework that makes it possible to legally work with various types of drug-free cannabinoids in order to produce goods for human or domestic consumption . Legislation adopted in 2018 in Canada , which legalized the possibility of various kinds of operations with psychoactive hemp, includes, among other things, new rules related to the ability of industrial hemp producers to collect flowers and leaves and sell them to a licensed processor for further extraction of cannabinoids, opening up new opportunities for development hemp breeding in the country. It should be noted that the production and distribution of cannabinoids, as well as products containing cannabinoids, is still regulated as well as operations performed with psychoactive hemp. In particular, any Canadian product containing drug-free cannabinoids, including cannabidiol, can only be accessed through licensed retailers with the appropriate prescription from their healthcare provider for the patient in need. At the same time, the sale of other products / products containing non-drug cannabinoids is still illegal. The transportation of drug-free cannabinoids and the green mass of plants from Canada under export contracts is currently also an extremely bureaucratic event, which requires appropriate permission from the relevant government agencies. Canadian hemp associations, as well as representatives of several other areas of the country's economic activity, are consistently working to ensure that Canada adopts a simpler regulatory regime for products containing non-drug cannabinoids. 

Use of drug-free cannabinoids in the zoo business

Another similarity between hemp breeding in the USA and Canada is that at the moment in Canada there is no regulation on the use of hemp ingredients for use in the zoo business , including as feed ingredients for livestock. However, in Canada there is a mechanism for applying for approval of any ingredient in pet food.

On the other hand, veterinarians in Canada do not have a legitimate reason to prescribe non-drug cannabinoids or drugs made on the basis of the therapeutic properties of hemp for the treatment of diseases of domestic animals. In particular, the Canadian Veterinary Medical Association in 2018 submitted to the Ministry of Health of the country proposals that it is necessary to approve the use of drug-free cannabinoids (primarily cannabidiol) as an ingredient in animal feed and various veterinary drugs. Therefore, at the moment, only one company at the official level has received permission to conduct research and at the moment in Canada there are no officially approved products for pets , which include non-drug cannabinoids.

US Hemp Market Gets Investment Resource From Canada

Based on the exponentially larger US population - 329 million compared to 37 million in Canada - and the apparent consumer demand that drives the market, it can be said that the rapid growth of hemp industry in the United States has attracted the attention of leading northern herding companies. Despite the fact that Canada can step up its efforts in order to compete, the investments of leading Canadian companies specializing in the cultivation / processing / sales of medical hemp in an actively developing American market speak a lot.

 

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