(This is an abridged version of a column that appears in the February issue of Marijuana Business Magazine.)
One of the most important uses of data in any industry is giving companies a realistic picture of supply and demand.
When data began to reveal white-hot consumer demand for CBD products in 2019, mainstream retailers from nutrition to footwear jumped on the bandwagon and began stocking CBD products on their shelves. Farmers also took note and began planting hemp in droves.
Having a true sense of demand for hemp and its derivatives—notably CBD—can help prevent the kind of widespread overproduction that causes prices to crash. Low prices for hemp biomass could be good news for processors and end-users of CBD—but if hemp growers pull back after an oversupply, the response could be underproduction, causing prices to swing in the opposite direction.
Again, this could be good news for some: Market volatility will always provide opportunity for speculators (see “Responding to Industry Shifts” on page XYZ). But for individuals trying to build a sustainable business, market stability with sustainable growth will be the key to creating lasting brands, jobs and economic success.
That’s where publicly funded research can come into play.
Read more about the new data landscape for the hemp industry here.