While the higher THC market is really sexy, the industrial side is transformational.”


Beau Whitney of Whitney Economics is the NIHC Chief Economist. He closely follows the entire cannabis marketplace; medical adult-use and industrial. His foray began by creating data

in the west coast medicinal cannabis sector, then adult-use and ultimately in industrial. It has evolved into a focus on hemp as a grain commodity, where he sees the most significant potential in the coming years.

Drawing upon his previous hi-tech and supply chain experience, as well as agricultural and economic development analysis expertise, he gained operational knowledge by designing and implementing notable efficiencies into the cultivation, extraction, edible manufacturing, wholesale and retail distribution operations of a vertically integrated cannabis operation for a large scale operator.

Now focusing on data and analysis, Whitney has established himself as a leading economist in the hemp and cannabis industries with clientele in North America, Europe, Asia, The Middle East, Africa and South America.

Whitney took some time to discuss his support of NIHC, and how data can help the association’s industry advocates clear up regulatory and legislative ambiguities.


How is your company helping to move the industrial hemp industry forward?

Our mission is to provide the industry the data and predictive insights they need to make informed decisions. With our data we can help the industry lay the foundation to build a thriving sustainable market, as a global player.


What value do you see in being a member of NIHC?

I enjoy the collaborative participation as NIHC Chief Economist and serving on NIHC committees. In my work in the last 7 years, we are approaching the industry with similar mindsets, so there are synergies.

With the prior levels of experience that is present in the organization’s leaders and volunteers, the NIHC has the ability to impact, influence and shape overall policy on a high level. This is very important.

NIHC has been able to get data highlighting vital issues directly in front of federal regulators. The industry needs this critical advocacy, which is focused on industry viability, education and sustainability, and articulating on issues confronting farmers, cultivators, producers and manufacturers. This is half of the battle.

I believe when we can interject real data with compelling education, then legislators can make informed decisions that help all the stakeholders to move the industry forward. NIHC’s experience advocating for agricultural, as well as the ability to look at the global market, not just U.S., is exactly what the industry needs right now. Vision to see the bigger picture.


Grain uses are a game changer.

Why is data important and how can it help the industrial hemp industry?

Data shows trends and identifies potential successes and shortfalls based on historical evidence. I try to leverage that data to forecast where the opportunities will be in the future. In the beginning, I saw that no one was fighting for the farmer, so I went deeper into the data, collecting information through comprehensive industry surveys so that I could create benchmarks that we could track over time. The goal was to help the farmers use data to help operate businesses and scale.

My goal is to map out the entire hemp value chain so operators can understand their role in the industry. It also has helped organizations like NIHC to present accurate views to legislators.

As an observation, I would like to see industrial hemp growers become more business-minded. The numbers show that this is a real weakness. This might be where NIHC can help their members network to understand the business, and to connect the dots throughout the chain.

Since 2019, growers have typically planted crops without arranged buyers – a basic business function – with 65% of them over the past two seasons not able to bring their products to market. This is several hundred thousand acres of hemp.

In my research I found that pre-2020 harvest, there was approximately 135,000 million pounds of excess biomass. That is raw material without a place to go. It seems that farmers did not do their business 101 homework before entering into this space.

Some didn’t even know how to harvest. They did not have the skills to scale. They were unsure how to grow from 1,000 sq. ft. to 25 acres, basically from a hobby grower to commercial operator. Some did not even know how to harvest crops at this scale. How were they going to harvest 25 acres by hand?

Now, in the “second season” for some of the veterans, we are seeing decline in markets and acreage, where some farmers did not renew their licenses, some scaled back their operations, or some renewed simply to sell their product from last season.

Farmers need access to buyers in order to sell their harvest to processors, who, in turn can sell the product manufacturers. This are the steps to building a credible thriving marketplace of products. In earlier days farmers were mostly taken advantage of by unscrupulous brokers. Hopefully, as the market matures farmers and processors will become more savvy. What is really required is for all participants in hemp to really to understand the value chain for hemp.

Grain uses are a game changer.

Most of the previous hemp supply chain was focused on CBD-related products, but I am not forecasting that to happen much longer. In 2020, CBD was 82% of the market to the 13% for grain and 5% for fiber. I see these numbers swapping in the near future.

Grain is forecasted to overtake CBD in terms of acres licensed by 2023. Hemp for animal feed is in the FDA for approval process right now. Once this is approved, hemp for animal feed will increase opportunities for farmers and processors.

Fiber is still in is infant stages. Degumming process is an issue, but once it able to be supported domestically, the fiber market will grow. Automotive and textile industry uses are emerging. This too, will surpass CBD in terms of market growth and opportunity.


From the data, what are the most important needs of the hemp industry today?

In terms of what is most needed, it would be:

1) Policy deployment should be flexible and adaptable for a dynamic market, on both federal and state levels. It is too rigid right now and is actually suppressing the industry. If it becomes too oppressive, the industry will lose investor confidence.

2) Regulators have created current policies coming forth that are ineffective. We need to clear up the murkiness. The law is crystal clear: Hemp is an agricultural product and should be regulated as such. The current ambiguity is keeping much-needed investors from bringing in the resources to grow the industry, there is too much risk involved to bring a product to market, only to have it potentially deemed illegal.

3) The industry really needs infrastructural development so it can scale up to mass production. Farmers, processors and manufacturers should not enter a space unless they know the entire value chain business model they want to follow.


Participation in the process and being a voice in big issues such as testing protocols, especially for the smaller farmers, is important. Large commercial operators will have it all in house, but smaller farmers need to express their issues as well.

How can industrial hemp growers be a part of the solution?

The key for success is looking at the data, being involved in organizations like the NIHC, having a relationship with the state’s Department of Agriculture and getting to know your neighbors.

Participation in the process and being a voice in big issues such as testing protocols, especially for the smaller farmers, is important. Large commercial operators will have it all in house, but smaller farmers need to express their issues as well.

Smaller farmers need to pool resources, for example, in a cooperative model, to collectively drive scale to compete with the large players. This is actually starting to take shape now. Local cooperatives or hemp campuses will offer the services needed for testing. Whitney Economics has met with many economic development agencies to help educate them about hemp and how to successfully support the industry.

Right now, many successful hemp projects involve public/private partnerships. A private company will do research on deploying and scaling hemp and the state provides the funding to do it. There is usually a sponsoring university and industry associations, all invested in critical in development of that state’s industry. Then it is given back to the state to run.

The biggest wildcard issue industry-wide is a lack of money. Investors are waiting for clarity on the regulations before they enter and drive end-user products, which will drive a demand for supply. Investment money is like oxygen for the industry and without it, the development of the industry will stall.

However, given that regulation is unavoidable, the industry has to understand how to operate within regulations and, rather than stifle the market, the regulatory need to support and protect the U.S. marketplace. otherwise it will be overrun by suppliers from other countries. It simply takes education, partnership and creative flexible regulations.

Even with all of these challenges in the short run, farmers and processors will survive (maybe not all of them), but from my perspective, the long-term outlook is extremely bright.

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Whitney Economics Hemp Cultivation Report 2020 - Executive Summary