European Hemp Market

Hemp / Industrial Cannabis has undoubtedly seen a rise in its market potential in the past few years. This article aims to propose some summarising remarks on the progression of hemp as an economic crop. Distinguishing between two major categories of derivative products – a) Utility Products b) Consumable Products – our focus will remain on the latter.

Consumable Products – Cosmetics, Food Products, Self-Care, Body-Care, Lifestyle Products etc. – enjoy a much more significant profit margin. This is due to mainly two things: 1) Cannabinoids & Terpenes 2) Nutritional Content of Hemp Seeds. However their path to marketability is not clear with volatile production & retail prices and systematic legislative ambiguity.

Legislative Harmonisation & Compliance

The legislation encompassing the circulation of hemp-based products remains ambiguous on a European level. This ambiguity is doubly paradoxical given the fact there are very clear laws regulating the production of Hemp. The cultivation of the plant is legal (albeit regulated) however major gaps appear in terms of legal categorisation of derivative products. This issue is exacerbated by the controversial debate surrounding cannabinoids – THC & CBD in particular. Legal limitations on THC in the plant do not translate into clear limitations of the same molecule in the context of a finished, consumable product. The variability of legal status of molecules before and after processing (extraction, concentration, dilution, etc.), and other issues of the same nature, constitute difficult conditions for the cementing clear marketability avenues.

The current environment strangely resembles situations whereby a particular X is formally legal, however there are no institutional instruments in order to access it (formally or informally). This is evident in the case of Hemp also from the European Subsidies point of view – with Greece being a case at hand. Albeit the legal status of Hemp and subsidies for farmers are defined on a European level, the national institution(s) designed to deliver those instruments were only set-up in 2015/6.

Disambiguation of Production Life-Cycle

Something to be expected from a flourishing but immature sector is the lack of a clear articulation of its Life-Cycle locus points. This translates into poorly defined distinctions between R&D and Manufacturing, Processing & Post-Processing, Extraction and Purification etc. The distinct operations needed to bring a product to the market are poorly understood as well as poorly legislated, often hopping between separate pieces of legislation. Furthermore, these necessary conceptual locus points have not found their articulation in terms of actual task separation and economic distribution.

Clear Business Strategy

The combination of Legislative disharmony with a still germinating Product Life-Cycle clouds the ability of entrepreneurs to focus their strategies and investments. This is further aggravated by the fact Hemp has a very high potential for applications. Whilst some value-added components (cannabinoids) are clear candidates for specialisation their legal status remains uncertain – whilst on the other hand more straightforward exploitations of Hemp are undervalued (nutritional content – proteins, omega3/6 etc.).

It is imperative for all Hemp Entrepreneurs to establish a clear business & financial plan. Understanding clearly the various components necessary in the development and mass-manufacturing of a product is crucial, as well as choosing the particular angle of approach and the service/product provided. Identifying one’s own position and function within the supply chain will increase individual and overall performance.

The Ideology of Hemp

Hemp wishes to sell itself as Hemp – exclusively. This is the expected, albeit harmful, over-identification reflex exhibited following a traumatic episode. Yes, Hemp was brutally repressed for decades, irrationally, or more precisely with an over-determined rationality: economic monopolies. However, clinging on to a particular image coupled with the compulsive need to be ‘alternative’ is impeding the industry from securing the legitimacy and mainstream audience it deserves. There is a need to attentively analyse the particular components of the plant that represent a financial opportunity, how these are coupled with existing or anticipated market demands and lastly, how Hemp can be the (anonymous) base or raw material for a vast number of related (or not) industries.

Open Thoughts

Any pessimism that comes through the critical appraisal of Hemp in economic terms is offset by the plant itself and its remarkable riches. The key word of the plant is Quality – form Utilities to Pharmaceuticals the products derived have intrinsic qualities. This aspect needs to be reflected in our efforts as Hemp Entrepreneurs. Quality assessment of the situation, quality arguments to mobilise stakeholders and finally, quality products bearing the fingerprint of the plant.