Industrial Hemp Market Forecasted to Grow by $13.90 Billion by 2028

LOS ANGELES- The industrial hemp market is projected to grow by USD 13.90 billion between 2023 and 2028, with a compound annual growth rate (CAGR) of 25.25%. The expansion is largely driven by increasing demand from the textile industry, notably in China and the US, where hemp fibers are valued for their strength and sustainability. according to a recent analysis by Technavio. Hemp’s versatility and environmental benefits contribute to its adoption across multiple industries, including textiles, food, biofuels, and pharmaceuticals.

Market Dynamics

Textile Industry Driving Growth:
Hemp fibers, known for their durability, have become a favored substitute for cotton and synthetic fibers. Technological advancements and policy support, such as the Government of Uttarakhand’s industrial cultivation initiatives, are key contributors to market growth. Hemp’s applications range from canvas and rope to clothing and specialized textiles like military gear.

Emerging Trends in Hemp-Based Foods:
Demand for organic hemp-based foods is rising due to consumer awareness of health and environmental issues. Companies like Canopy Growth Corp. and Charlotte’s Web Holdings are expanding their portfolios with organic hemp products, driving further market growth.

Challenges in Production:
Despite the growth potential, hemp cultivation faces significant challenges. The crop requires specific climatic conditions and often struggles with regulatory hurdles. The similarities between hemp and cannabis complicate production, as THC content regulations vary by region, affecting global market dynamics.

Regional and Segment Analysis:
The Asia-Pacific region (APAC) is expected to contribute 39% to market growth, led by China, the world’s largest producer of hemp. The seeds segment is also set to dominate, with hemp seeds used increasingly in both food products and industrial applications.

Competitive Landscape:
The market remains fragmented with companies like Aurora Cannabis Inc., Bombay Hemp Co. Pvt. Ltd., and HempFlax Group BV leading innovation. Industry consolidation and technological advancements are likely to shape the market over the forecast period. As industrial hemp continues to gain traction across industries due to its sustainability and versatility, market growth is expected to remain robust through 2028. Challenges in production and regulatory complexities will persist, but ongoing demand from textiles and organic foods will drive further expansion.