HEMP EXPORT INCLUDED IN NEW U.S./CHINA TRADE DEAL
The new trade agreement requires China to import more American-grown hemp, opening trade flow for the next two years.
A new trade deal between the United States and China includes hemp export, boosting future hemp production for American farmers.
“It is expected that these changes and other trade liberalization being pursued by China will lead to improved trade flows benefiting China’s trade partners, especially the United States,” according to the U.S. expanding trade fact sheet.
On Jan. 15, U.S. policymakers signed the Phase One Economic and Trade Agreement between the U.S. and China. Under the new trade terms, China is required to open its economy and improve its trade regime. One of the 200 required agricultural goods to be exported to China from U.S. farmers is hemp.
While the trade deal did not place a specific dollar amount on how much more hemp China will be importing from the U.S., the document states that the country must spend at least $12.5 billion more than it did in 2017 on agricultural commodities, including “true hemp,” for the calendar year 2020. The terms state that in 2021, China must spend at least $19.5 billion more than the 2017 baseline.
In total, China’s imports of U.S. agricultural products will total at least $80 billion over the next two years. Additionally, China is expected to strive to purchase an extra $5 billion of agricultural products annually.
Jonathan Miller, general counsel for the U.S. Hemp Roundtable, told Marijuana Moment that hemp’s inclusion in the trade deal is a “really good development.”
“The fact that China would be importing our hemp and would be giving a new market for American farmers is pretty exciting,” Miller explained to Marijuana Moment, in reference to former U.S. importation of hemp from China.
U.S. Hemp Production
Hemp, a non-intoxicating variety of the Cannabis sativa plant, officially became an agricultural commodity under the 2018 Farm Bill and was removed from the Controlled Substances Act. The new law made it legal for U.S. farmers to grow, process, and sell hemp commercially.
According to a recent report from the United States Department of Agriculture (USDA), over the last several years the amount of acreage used to farm hemp jumped by 368 percent. Industrial hemp cultivation surged from 27,000 acres in 2018 to 128,000 acres in 2019.
Hemp is a versatile crop harvested for its stalk and seeds. Both parts of the crop can be utilized in the manufacturing of thousands of products, including textiles, paper, animal feed, food, body care products, and CBD oil.
With the exploding new hemp-derived CBD market, growth in the hemp industry is expected to surge in the next several years. According to a new analysis from Brightfield Group, the U.S. hemp CBD market will hit $22 billion by 2022.
CBD oil derived from hemp is now legal to purchase at the federal level in the U.S. and in roughly 40 international countries.