However, that scenario would only be possible if the current regulations, which largely prevent the industry from utilising the cannabidiol (CBD) parts of the hemp plant, are reformed.
The report, commissioned by the NZ Hemp Industries Association Inc, funded by AGMARDT and authored by Nick Marsh, aimed to inform investors and politicians about the opportunity hemp provides to the New Zealand economy as it faces coming out of a covid-19 recession.
While the cultivation of hemp is permitted in NZ for the production of hemp seed oil and hemp seeds, as well as fibre products containing CBD containing less than 2% Tetrahydrocannabinol (THC), must be prescribed by a doctor.
Changing those rules and allowing the industry to use this part of the plant would allow it to create products in the lucrative nutraceutical industry.
Of the $2bn scenario, products made from hemp nutraceuticals derived from cannabinoids, terpenes and flavonoids could be worth $1.5bn.
The report also predicts $183 million from seed products and $317m in fibre products.
If the status quo is kept, seed and fibre products would earn $500m and bring 5000 new jobs in the regions.
“For the New Zealand hemp industry, and those lawmakers who have the power to remove the constraints on its growth, the question that is begged by this review of the global growth and opportunity in the hemp industry is: ‘If not now, then when?’,” it asks.
The report says the industry would grow substantially if a regulatory framework is put in place enabling the manufacture, sale, import and export of non-medicine hemp products containing CBD.
“This would facilitate investment in research and development, infrastructure and new product development, to enable substantial export activities,” the report said.
Its vision was to have hemp grown across the country in different climate zones which allow for variation in cannabinoids, seed and fibre crops, similar to NZ’s wine regions.
NZ’s small population meant that substantial industry growth could only be achieved through an aggressive export strategy, similar to the horticulture and viticulture sector.
“These industries have played to the country’s strengths and built profitable niches in global markets,” it said.
“The hemp industry has much to learn from the wine industry, which has implemented a high-value export strategy, with products aimed at discerning customers.”
Currently, around 1200-1500 hectares of hemp is farmed in NZ.
“In fact, the conditions in New Zealand have proved to be excellent for hemp production, resulting in high yields per hectare. The crop can be harvested within 100 days or matured to produce a seed crop within 140 days,” it said.
Growers can expect returns of $4000-5000/tonne for seed and US$500/t for fibre – depending on specification, it said.
At the market end, depending on the final product, a hectare of hemp can make around 250 litres of hemp seed oil retailing for up to $75 a litre, or a tonne of hemp seed for food, retailing up to $70/kg for hulled hemp seed.
Three tonnes of hemp fibre can be harvested for rope and textiles, retaining for $2/kg or that fibre can be turned into hemp hurd (pulp), useful for the production of paper and construction materials such as hempcrete, retaining for $1/kg.
Hemp products are making a comeback globally into mainstream consumer markets as well as industrial markets, most notably in the Americas and across Europe.
It says the global hemp industry is projected to grow from US$4.6bn in 2019 at an annual growth rate of 34%, to US$64.8bn by 2030.
The biggest share of this market is expected to be CBD and other cannabinoid products, followed by seed food products, as well as an increasing demand for low and high-tech fibre products both locally and overseas.
“A niche market which NZ could quickly dominate is premium seed oils for the discerning consumers of high-quality cuisine in San Francisco, London, Shanghai, and Berlin,” it said.