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The Fine Print
Spiro Sertsis, CPA, CMA
@SpiroSertsis
Production costs and price per pound within Canada seem to be competitive with their US counterparts. Coupled with the strong US dollar relative to the Canadian dollar at this time, make for attractive margins for Canadian companies exporting to the United States.
In the United States, the landscape for growing hemp could be even better than here in Canada, where control is still in the hands of Health Canada. The proposed bill discussed by Sen. Mitch McConnell, would remove hemp from the controlled substance list. The bill would legalize hemp as an agricultural commodity, something Canada has yet to budge on.
According to an April 12, 2018 article in Forbes, in addition to legalizing hemp under federal law, the Hemp Farming Act of 2018 would remove restrictions on banking access, water rights and other roadblocks that farmers and processors currently face. The U.S. Department of Agriculture would receive oversight plans from states, and then state departments of agriculture would regulate local production. The bill would also make USDA research funding available to farmers, and hemp plants would be eligible for crop insurance. The market for hemp-based products exceeded $581 million in 2013 with double-digit growth in year-over-year sales to approximately $688 million in 2016, and this is despite not having a federal framework for legalized growing in the US. The sales data on hemp foods and body care, collected by market research firm SPINS, was obtained from natural and conventional retailers, excluding Whole Foods Market, Costco, Alfalfa's Market, and certain other key establishments, who do not provide sales data — and thus it significantly underestimates actual sales. According to the SPINS data,