Agribusiness News May 2024 – Sector Focus: Scottish Hemp Fibre

Advancing a sustainable Scottish supply chain for hemp fibre

Multiple SMEs are interested in developing a domestic supply chain for hemp and hemp-derived products to increase resilience, sustainability credentials and local community impacts, yet no single SME has the resources to determine the agronomics/techno-nomics underpinning a newly created domestic Scottish supply chain. Farmers, as an integral part of the supply chain, are naturally interested in the opportunities that growing hemp fibre could potentially bring. If the economics were to stack up, the addition of a new break crop to current rotations would be favourable.

Market failure to date

Despite these benefits the supply chain is still exposed to many threats limiting its development, including the limited routes to market, unproven profitability, lack of technical support, weather limitations, lack of financial assistance and unhelpful licencing protocols. It is fair to say that currently there is a market failure in the supply chain; markets for hemp fibre are growing rapidly and manufacturers are already operating in this sphere, but production and hemp processing have yet to evolve at scale in Scotland.

2024 feasibility study

Aware of this current market failure, SAC Consulting reached out to Scottish Enterprise (SE) in the latter part of 2023 for funding to support a supply chain study. The request was timely, aligning with the demand for a scalable sustainable biobased feedstock becoming more critical as the Scottish and UK government set their net zero mandates for 2050. Supported by the Industrial Biotechnology Innovation Centre (IBiolC), funding has been awarded and the study will run through 2024 involving variety trials, an assessment of the technical and economic aspects of crop production, crop processing requirements and market analysis. The main deliverable will be a free and publicly available ‘sector’ report, detailing all the project findings, to be published by SE on Evaluations Online, early in 2025.

Historical context

To give context to the project, hemp was widely used in the UK until the 20th century when cheap and abundant jute and cotton made it uncompetitive. The decline in its industrial use was gradually replaced by its misuse as a psychoactive drug. This resulted in European and North American countries banning its cultivation. By 1928, cultivation was banned in the UK too.

Indeed, the UK has, by virtue of its strict licencing requirements, fallen well behind the times. That having been said, more recent lobbying, has been rewarded, with the Home Office moving to relax future licensing requirements for farmers wanting to grow the crop. Legislative amendments have already been made abroad and enabled European production to flourish. France is the largest producer of hemp in Europe, accounting for 67 per cent of the total hemp production in 2020. Poland was the second largest producer of hemp, followed by the Netherlands, Austria, and Italy. The top five countries produce 94 per cent of the total EU production.

In recent years the area dedicated to hemp cultivation has increased significantly in the EU from 19,970 ha in 2015 to 34,960 ha in 2019 (a 75% increase). In the same period, the production of hemp increased from 94,120 tonnes to 152,820 tonnes (a 62.4% increase). The major suppliers of hemp fibre to the UK are currently France, Lithuania, Netherlands, Australia, and Senegal.

Figure 1: EU land used for hemp cultivation from 2015- 2021. Source: European Commission

Carbon circular economy

As previously alluded to, hemp is receiving increasing appeal also for its ability to capture large volumes of carbon and to form part of circular economies. Industrial hemp absorbs upward of 13 tonnes of CO2 per hectare, and it is estimated that 1.63 tonnes of carbon is sequestered for every tonne of hemp grown. The value in that, itself, is interesting and of potential economic merit.

If you would like to be kept informed on project developments through the course of this year register your interest at  mark.bowsher-gibbs@sac.co.uk.

 

Mark Bowsher-Gibbs, mark.bowsher-gibbs@sac.co.uk