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Hemp growers sowing seeds of expansion

By Yang Wanli and Li Yingqing | CHINA DAILY | Updated: 2020-03-25 10:08
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Cannabidiol, also known as CBD, a nonintoxicating extract of the Cannabis sativa plant, is highly valued for its uses in medicine, cosmetics and food. [Photo/China Daily]

Foundations

Early in 2009, Pan learned about CBD from a business partner in the United Kingdom who worked in the cosmetics sector. "He told me CBD was used overseas in cosmetics, healthcare products, pet food and even medicines. Moreover, it sold for about $4,000 per kilogram in the international market, which sounded very profitable," he said.

"He tried to persuade me to grow hemp in China and extract the CBD. I refused. After all, many people associate anything hemp-related with additive drugs. How could I dare enter such an illegal business?"

Despite initially dismissing his friend's suggestion and blocking CBD from his mind, Pan later began researching the subject. Having learned more about the extract and its potential, he founded Hankang in 2014 with the help of experts from the academy. The company was the first in Yunnan to be granted a certificate to legally process hemp.

Hankang now grows hemp on 333 hectares of land spread across several cities and towns, including Eshan, Xinping and Yuxi, and extracts about 5 metric tons of 99 percent pure CBD a year.

"Seventy percent of it is exported to the UK and the other 30 percent is sold to buyers in the United States. In addition to nutritional supplements, cosmetics and pet food, the extract is used in many foreign countries as an ingredient in drugs to treat childhood epilepsy," Pan said.

As a newly emerging trend, Pan said the sector lacks accurate global data about the scale of planting and production. Moreover, there is no regulated market price, but approximations are released by a number of industry associations and research institutes.

According to Brightfield Group, which collates data about the CBD and cannabis industries, China was the world's leading CBD supplier in 2018, with sales of nearly $1.2 billion. It was followed by the United States ($1 billion), Europe ($980 million) and South and Central America ($220 million).

In the past five years, the booming industry has attracting a growing number of companies looking to extract CBD from hemp leaves and flowers. Some are biotech specialists, while others operate in the pharmaceutical sector.

According to Yang, Yunnan is the global pioneer in large-scale CBD production and the province is home to more than 30 startups, seven of which have already begun operations.

"The high-purity CBD produced in the province now accounts for more than half the global market share, and our extractive technology is a world leader," Yang said.

"Yunnan is a renowned international producer of high-quality CBD, which is mainly exported to the US, Canada and European countries."

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