Techno-Economic Analysis of Hemp Production, Logistics and Processing in the U.S

Abstract

Industrial hemp is a versatile crop, and its products have important applications in the food, cosmetic, pharmaceutical, textile, paper and composite industries. Since its legalization in the U.S. in 2018, interest in growing and using hemp has been increasing. This study evaluated the techno-economics of hemp grain and fiber production, harvest and post-harvest logistics, the drying and storage of hemp grain, and the decortication of fiber stalks. The analysis was performed using a process modeling approach with data obtained from the literature considering a farm size of 162 ha (average U.S. farm size). The input parameters were used as distributed functions and the results obtained are reported as interquartile ranges after 10,000 Monte Carlo simulations. The total cost of producing and processing hemp grain and fiber was estimated to be in the interquartile range of USD 2911–3566 Mg−1 and USD 1155–1505 Mg−1, respectively. The costs of seed and fertilizer along with grain and fiber yields were found to be the major factors influencing field production costs, while costs associated with facilities and labor were the main costs in fiber processing. Despite the high resource requirements and processing costs, high-value applications of hemp grain and fiber show great potential to produce net incomes of USD 426–3701 Mg−1 and USD 1570–2016 Mg−1, respectively.