Will Hemp-Derived CBD Oil Save The Marijuana Trade?
With wholesale and bulk cannabis prices in Oregon plummeting, some growers are turning to the other green rush —hemp-derived cannabidiol (CBD). In fact, since 2015, applications for hemp cultivation licenses in the state have increased more than twentyfold.
Oregon's current inventory of marijuana is a staggering one million pounds of flower. On top of that, there’s also 350,000 pounds of marijuana extracts, edibles, and tinctures sitting on retail warehouse shelves in the state. Under federal law, none of it can leave the state.
As a result, the retail price for cannabis in the state has fallen 50 percent since 2015, from $14 to $7 per gram. The surplus is widely blamed on the state’s decision not to limit the number of available marijuana cultivation licenses.
The CBD “Green Rush”
Meanwhile, CBD oil is rapidly going mainstream, partially as a result of the exponential growth of CBD-infused edibles and cosmetics. The current price of concentrated CBD oil from hemp extract is thousands of dollars per kilogram. Farmers who produce hemp for CBD earn more than $100,000 per acre. Currently, more than 50 percent of hemp grown in the U.S. is earmarked for CBD extraction.
CBD advocates claim that the cannabinoid compound provides numerous health benefits. One of the most common reasons cited for using CBD is to reduce anxiety and relieve stress. Some pre-clinical studies suggest that CBD may also be an effective treatment of PTSD, chronic pain, inflammation, and substance-use disorders.
The Food and Drug Administration (FDA) is poised to approve Epidiolex, a drug derived from CBD which is used to treat epilepsy. Meanwhile, a report by market intelligence firm Hemp Business Journal projects that sales of CBD products will grow to $2.1 billion by 2020. Billion dollar companies will be built around CBD. It should be interesting to see how many of those start out as marijuana cultivators.