A review of commercial hemp production and its economic viability

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University of New Brunswick


With hemp (Cannabis sativa L.) being grown commercially for the first time since its ban in 193 8, interest in growing the crop and its potential markets are of interest among farmers. This paper addresses issues surrounding the hemp crop and explores potential markets farmers may target for products derived from the crop. The study was done for the Province of Manitoba in the Wawanesa and Morden areas where hemp trials have previously been conducted. In this study it was found that growing the crop for bast and hurd fibres was not profitable for farmers. The high costs of transportation combined with the low returns contributed to this. However, the potential of a portable pulp mill located on a farmer's landbase is an attractive option for farmers. A specialty pulp market, assumed to exist in Winnipeg, was targeted for the operation. A before-tax approach could potentially bring in returns ranging from 42.7% up to 172.9%. A sensitivity analysis was used to assess the effect of varying pulp prices on the returns which were found to significantly affect these. An analysis of reduced transportation costs were found to significantly increase potential returns for hemp full stalks. It was found that returns for the crop could range from $759.05 per hectare up to $1536.42 per hectare.