Long before you plant your crops, you should know where to sell your industrial hemp biomass.
Where exactly you end up selling your hemp biomass will fundamentally come down to the type of crop you’re growing: grain, fiber, or CBD.
Most American farmers jumping on the hemp bandwagon in the wake of the 2018 Farming Bill are focused on the incredibly lucrative CBD market. This is an especially important focus, due to China and Southeast Asia having the grain and fiber market pretty well sewn up.
So, in the US, there are basically two options for where to sell industrial hemp biomass. You can either go directly to a processing and extraction company or you can work with a broker.
Examining Extraction Companies
Having a middleman – a broker – can result in complicating a situation, though that’s not always the case. But with this in mind, if you are personally able to create the network and establish the connections to sell your hemp biomass directly to a CBD processing and extraction company, you’ll be better off.
However, you’ll want to be careful.
In today’s market, where investors are diving in on the CBD market and new companies are popping up all over the place, things can get dicey when the time comes to sell your harvest. The best thing to do is to work directly with an experienced, established company that is able to accurately assess the value of your crops based on CBD test results and give you a deposit to secure the transaction as soon as possible.
Selling directly to a buyer will usually give you a lot more room to negotiate deals, as well as the potential to build a relationship that can lead to future contracts and field profit-sharing deals.
One such direct purchasing company, based in Illinois, is Revolution Enterprises, which consists of a dispensary and medical marijuana cultivation facility. They also press CBD oil.
Revolution Enterprises told Farm Progress that they will not be contracting with farmers at this time due to price volatility, but expect to still be providing a competitive outlet for farmers to sell hemp biomass.
Revolution Enterprises is just one of a number of processing and extraction companies willing to buy hemp biomass for CBD production. In a worst-case scenario in which you are struggling to find a buyer and don’t want to deal with a broker, it’s possible to create a post searching for hemp biomass buyers on the National Hemp Association’s website.
But in the ideal situation, you’ll have the chance to work with a cash-in-hand buyer when you’re looking for where to sell industrial hemp.
Breaking Down CBD Brokers
Despite the serious investment by large corporations in CBD oil products and assets, it can still be difficult for you to determine where to sell industrial hemp biomass come harvest time.
This is when a hemp broker can step in and make all the difference — if they’re good at what they do. The primary concern many farmers have when working with a broker is dealing with someone who is either new and incompetent or someone who is downright dishonest.
However, the hope is that the broker will use their established network and relationships to connect your product with a buyer in a way that is mutually beneficial to everyone involved.
Unlike dealing directly with a buyer, when working with a broker, it’s possible that they won’t immediately have funds available to secure your contract. Additionally, there are some out there that might simply be making promises they cannot keep. Nonetheless, that doesn’t mean a broker is a bad fit for what you need.
Noting Novice Hemp Brokers
A novice CBD broker usually doesn’t have the infrastructure necessary to expand their brokerage business beyond just a handful of clients. However, they will have sales skills and be able to help build bridges between you and the marketplace.
Though they rely heavily on non-disclosure and non-circumvention agreements before making introductions between you and a buyer, such paperwork is fairly standard for any broker.
These agreements are designed to prevent the buyer and seller from working directly with each other and cutting the broker out of the deal. A novice broker is just more dependent than an experienced broker on these documents being signed first thing because nearly all the value they bring to the transaction is introductions.
Explaining Expert Hemp Brokers
The key aspect to understand about an expert hemp broker is that they have a deep knowledge of the hemp and CBD industry. Because of this, they are able to create value for your hemp biomass beyond introductions and sales pitches.
Until the CBD market settles down — and there is less volatility in the market — working with an experienced broker can make all the difference. They will bring a holistic view of the market, as well as an understanding of week-to-week changes in trends with regards to supply and demand. This means that they will not only know where to sell industrial hemp but when to sell it.
Breaking with Bad Hemp Brokers
Then, there are simply brokers who give the rest of the profession a bad name. Such brokers are either dishonest — trying to scam farmers to get rich fast — or just don’t care enough to put together a real business.
These brokers are usually charged with chasing “unicorn deals”, which are basically deals that are too good to be true. If you feel like you’ve accidentally fallen in with such a brokerage company, it’s time to hit the brakes and do some real research to see if your fears are justified.
Final Thoughts: Where to Sell Industrial Hemp
Where to sell industrial hemp as an American hemp farmer is something you should fully understand before designating any of your field space for the booming cash crop. As the hemp industry continues to grow in the United States, there is the possibility of the development of stronger domestic grain and fiber markets. However, as it stands, CBD is where Americans are making their money.
If you are able to develop relationships via social media or by other means directly with buyers, you’ll most likely be able to strike the best deal for both of you that way — there is a reason that people try to cut out the middleman.
However, if you aren’t able to directly connect with a buyer, an expert hemp broker who can help you navigate the tricky marketplace and add value to your crops via their own understanding of the industry is the next best thing.
Talk to the experts about what seeds and clones will be best for your hemp farm.