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The People’s Republic of Hemp

The People’s Republic of Hemp

The People’s Republic of Hemp

March 24, 2014 Cannabis Economics

Hemp Production in China

 

It might come as a surprise that the worlds most populous country is also the largest producer of hemp products. Yes, we’re talking about the same country in Asia with the giant wall, environmental issues that would give Head of the EPA Gina McCarthy a heart attack, and enough pandas to make Putin wear a WWF shirt. No one can deny how adorable they are when they’re tumbling down playground slides or doing summersaults on YouTube, but the point is that China’s got more skin in the global hemp trade than anyone.

With roughly 200,000 acres devoted to industrial hemp cultivation (more than three times that of Canada), China has ~40% of the world marketshare in hemp fibers and ~80% of the world marketshare in hemp seeds, processing more than 30,000 metric tons of hemp fiber annually. China clearly demonstrated their effect on world hemp seed prices when they fell 43% (from an average of 26.5 cents to 15 cents per pound) during the late 80s and early 90s, and then doubled in price in 1992 when they ceased exporting. While China mainly uses hemp domestically for food products, they’re also spending a fair amount on pharmaceuticals. According to the World Intellectual Property Organization, Chinese firms filed more than half of the patents relating to cannabis and hemp (309 of 606). So if it’s illegal to grow industrial hemp in the US, how have we been getting our cool hemp T’s and hempseed granola bars?

In the mid 90s, a Los Angeles native named Lawrence Serbin quit his day job and began developing a hemp trading company called Hemp Traders that works directly with the farmers, manufacturers, and hemp processing factories in China. Today, they’re the largest hemp supplier in the US, supplying everything from hemp moisturizing cream to hemp socks, with most sales stemming from hemp seed and oil. Many, like Serbin, have turned to importing from China, and more recently, Canada, after it lifted its 60-year ban on commercial hemp production in 1998.

Although hemp pales in comparison to cotton, and most people in China have never heard of it, the shift in global demand for hemp could spark a renewed interest in China exporting the hempseed superfood once again, earning its new nickname, the People’s Republic of Hemp!

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