The Rise and Reasons for U.S. Hemp Fiber Exports
By Eric Singular, Director, Hemp Business Journal
It has been a bumpy ride, but passage of the 2018 U.S. Farm Bill has begun to foster a strong international market for U.S.-grown hemp fiber. From two years before Congress reclassified hemp, to three years afterward, U.S. hemp fiber exports have increased more than 11x in weight, and nearly sixfold in revenues.
When looking at the newly updated Hemp Data dashboard in Equio, New Frontier Data’s cannabis business intelligence platform, we see that in 2016 the U.S. exported 204,448 pounds of spun and unspun hemp fiber worth a combined $495,836. By 2021, those numbers were up to 2,307,096 pounds, with a value of $2,917,342, placing the U.S. firmly among the world’s top three hemp fiber exporters.
Between 2019-2020, particularly, exports skyrocketed with 2,023,833 pounds of material, worth $6,010,298, leaving the country, up from $479,415 the previous year. That has coincided with many fiber processors’ becoming operational in the past two years nationwide. Noteworthy is that while 300,000 more pounds were exported a year later in 2021, the price per pound had decreased dramatically, accounting for only $2,917,342. This drop in price signals market maturation and the glimmer of a shift toward economies of scale – key to achieving parity and greater adoption of hemp fiber as a renewable material.
While fiber has ironically been among the hemp sector’s slowest segments to develop since the Farm Bill, its versatility for broad applications (including paper, textiles, construction materials, and natural fiber-based biocomposites) has spurred investment and the development of infrastructure.
Since 2020, operators capable of processing between 1 and 5 tons of fiber per hour have opened their doors in states like Alabama, North Carolina, Missouri, Oklahoma, Montana, Texas, and Kansas.
Europe is a Key Strategic Trade Partner
In 2020, 95% of U.S. hemp exports were destined for Europe. Though that dropped to 74% in 2021, as competitors in Canada, Asia, and Latin America each ratcheted up their production, Europe remains key as the largest purchaser of U.S.-produced hemp fiber.
In 2020, Switzerland became the world’s third-largest importer of hemp fibers, spending $5.3 million. The promise of a carbon-friendly natural fiber has caught the attention of Swiss brands, like Lavie. The Zürich-based clothing and home goods manufacturer has recently launched a 100%-hemp bedding line.
Data from the U.S. Census Bureau indicates that Switzerland has been the largest importer of Harmonized System (HS) Code 530210 (i.e., true hemp fiber, raw or retted) from both the U.S. and globally. In 2021, Switzerland imported 1,488,947 pounds of U.S. hemp fiber worth $2,008,684.
Throughout 2021, Switzerland accounted for 69% of U.S. hemp fiber exports. As of May, U.S. exports of hemp fiber in 2022 reached 87,800 pounds, valued at $269,550. Switzerland again remains the largest importer, responsible for 38% of the trade volume.
With a long history of textile production, the Czech Republic, too, is a key European trade partner for U.S. hemp fiber. Between 1993-2017, its volume of textile exports grew by 281%, as its volume of clothing exports grew by 540%. The nation imported 85,950 pounds of hemp fiber from the U.S. in 2021.
Canada, Asia, and Latin America
Per HS Code 530210, the U.S. in 2020 exported 7,465 pounds of hemp to Canada for $3,261. A year later, those numbers jumped to 331,730 pounds (increasing 44.4x) and $122,551 (up 37.6x). While such increases seem unsustainable for 2022, use cases for the shared development of a market for hemp fiber and manufacturing in North America, paired with free trade enjoyed between the U.S. and Canada could forge a key strategic partnership between the neighbors.
Likewise, Mexico’s U.S. imports under HS Code 530210 have steadily increased over the past four years, reaching 61,048 pounds in 2021. Before 2022, Bermuda reported no imports of U.S. hemp fiber, but reached a substantial 65,707 pounds by May.
Brazil and Japan have also begun importing U.S. hemp fiber during the last few years and seem to be ramping up dramatically. As of May, Japan had imported 44,006 pounds in 2022, well beyond half of its total of 63,921 pounds last year. For its part, Brazil imported 19,213 pounds in 2021, and tipped 15,684 pounds during May.
Just the Beginning
As the U.S. fiber processing infrastructure remains nascent, operators are navigating a steep learning curve about how to separate and decorticate the long (i.e., bast) and short (i.e., hurd) fibers from the hemp stalk. For now, low-tech, hurd-based applications are driving the market and innovation as these cellulose-rich natural fibers have a diverse range of uses as a renewable alternative to wood.
As the industry has gotten underway, hurd’s early entry point has been through the animal bedding market. That has been partly due to there being no secondary processing required to achieve a viable end-product, which is in sharp contrast to what’s required for bioplastics or building materials like insulation.
One of the nation’s largest hemp operators, IND Hemp, has built a 52,000 sq.-ft facility for fiber and grain processing on a 10-acre greenfield site with a LaRoche bast fiber decorticator. IND Hemp’s new product line for ranch and farm animal nutrition and care includes equine bedding from hurd that is absorbent, chemical-free, offers superior odor control, and is 99% dust-free.
As the markets mature and evolve, U.S. hemp producers’ optimization, scale, and efficiency in agronomy and processing will increase exponentially. This will open further opportunities, positioning the U.S. to overtake France, which only leads by $4.7M, as the leading global hemp fiber exporter in the next few years. As detailed in New Frontier Data’s report, The U.S. Hemp Market Landscape, the country’s hemp fiber market is projected to reach a value of $77.7 million by 2025.
