US Farmers Expand Hemp Acreage, Many Switching from Marijuana Production

News provided by

Jul 15, 2019, 09:37 ET

CLEVELAND, July 15, 2019 /PRNewswire/ -- Following the passage of the 2018 Farm Bill, the production of hemp (or industrial hemp) is legal nationwide, and hemp is removed from the Controlled Substances Act. Marijuana, on the other hand, remains illegal at the federal level.

Farmers in the US are quickly expanding hemp acreage to take advantage of the booming demand for CBD compounds used in therapeutic medical treatments and foods and beverages.
In states where marijuana prices have plunged due to a flood of new entrants and oversupply issues, a significant number of outdoor marijuana growers are switching to hemp production.

Consequently, the majority of additional cannabis capacity in the near term will be dedicated to hemp production. The study Cannabis Growing Market discusses the regulatory environment, production of marijuana and hemp, demand for consumables and growing equipment, and trends by state.

Analyst Carolyn Zulandt writes, "Demand for equipment used in cannabis growing applications is expected to reach $2.7 billion in 2019 and expand 10% annually to $3.9 billion by 2023."

Growth will be driven by:

new entrants in the cannabis industry, as they must make the initial capital investments necessary to compete with other growers
cultivators with existing operations who will continuously need to replace light bulbs and parts, and/or upgrade to new equipment
expansions in canopy size that will prompt new equipment purchases by established cultivators

Water tanks, irrigation equipment, and hydroponic systems – relatively high-cost items and a major expense for indoor marijuana operations – will account for the largest portion of sales in 2019. Fans and HVAC equipment – important for indoor operations and for outdoor growers of marijuana and hemp that also maintain on-site greenhouses – will represent the second largest equipment segment. Security equipment, lighting systems, and replacement bulbs are also major expenses for cultivators.

More information regarding the Cannabis Growing Market study is here: https://www.freedoniagroup.com/industry-study/landscaping-products-3738.htm

Additional studies covering outdoor living and landscaping trends are available from Freedonia's Consumer Goods research group.

About The Freedonia Group – The Freedonia Group, a division of MarketResearch.com, is a leading international industrial research company publishing more than 100 studies annually. Since 1985 we have provided research to customers ranging in size from global conglomerates to one-person consulting firms. More than 90% of the industrial companies in the Fortune 500 use Freedonia Group research to help with their strategic planning. Each study includes product and market analyses and forecasts, in-depth discussions of important industry trends, and market share information. Studies can be purchased at www.freedoniagroup.com and are also available on www.marketresearch.com and www.profound.com.

Press Contact:
Corinne Gangloff
+1 440.684.9600
[email protected]

SOURCE The Freedonia Group