[PRESS RELEASE] – PORTLAND, Ore., Aug. 28, 2025 – Beau Whitney, chief economist at Whitney Economics and a world-renowned cannabis and hemp economist, presented new data debunking the U.S. Dept. It is not accurate to use the U.S. Dept. You can also find out more about us here. The hemp industry is booming, but it’s not helping farmers.
Whitney stated that “by publishing incorrect data regarding the value of hemp crops, the USDA inadvertently harms the farmers who they’re trying to regulate.” The lower price of the hemp crop makes it harder for farmers to get money. It also inhibits infrastructure development and reduces market growth. This USDA error is also discouraging growers from including hemp in their crop rotations. “In reality, hemp farmers benefit more from their contributions than corn and soy farmers.”
Farmers are required by the USDA to report information on their hemp operation each year. Some of the data collected pertains to the type of hemp grown, its purpose (fiber, grain, seeds or cannabinoids/floral), the amount grown, and the value of the crop harvested. The data collection for hemp is similar to that used with most agricultural crops. But the method of evaluating the hemp crop’s worth is difficult to use.
It is not difficult to determine the value for hemp grain, fiber and seeds. The products that are derived from them have a consistent value and are of limited use. But the method for calculating the value is faulty, because the output of flowers can be used in multiple ways, and the values of these uses vary greatly.
Whitney explained that the problem in the method of calculating floral output was the fact that the flower value is much higher than the biomass value. According to standard USDA practices the value is calculated by averaging the sale of both the biomass and flower. The combined average price of the pound severely undervalues this crop.
Hemp flower was worth more than $330 a pound in 2024. However, biomass is valued at $2 a pound. The USDA reported that floral cannabis production in 2024 will be 20.8 million pounds, valued at $386 millions. It is worth an average of $18.56 a pound. The $386 million worth of flowers would only require 1.2 millions pounds. The USDA undervalues the floral industry because of this error in determining crop value.
The investors are missing out on the potential of the market by undervaluing this crop. Whitney stated that in return, the farmers were less likely to plant or use it as part of their crop rotation. And policymakers used erroneous information to make decisions. In a recent hearing of Congress, for example, one senator argued that hemp farmers were only getting 1% of their total revenues from the market worth of $28,4 billion.
The wholesale value of 20.8 millions pounds, valued at 330 dollars per pound would equal $6.86billion. This represents 24,2% of total retail sales. The farmers would be able to get a lot more money from hemp (24.2%) than they do with corn (15%), or soy (7.9%).
Due to the fact that hemp’s revenue shares are higher than those of corn or soybean, farmers and investors would be much more willing to invest and cultivate hemp.
Whitney added that “highlighting how farmers benefit from hemp cultivation will also influence policy at the federal levels.” The USDA’s error has a significant impact on the hemp market and needs to be corrected immediately. Otherwise, the market growth and hemp production will suffer.
Resources:
https://www.nass.usda.gov/Newsroom/Executive_Briefings/2025/04-17-2025.pdf
https://www.fb.org/newsroom/fast-facts
https://www.ers.usda.gov/data-products/charts-of-note/chart-detail?chartId=108346
To read more about this report visit whitneyeconomics.com.