5 Reasons to Start a Hemp-Based CBD Oil Business

Cannabis 21 Sep, 2018

Cannabidiol or more commonly known as CBD is a chemical compound that belongs to a group called cannabinoids. Cannabinoids are found in cannabis or marijuana (Cannabis sativa). Studies show that CBD has been known to help treat anxiety, insomnia, PTSD, and epilepsy. There are also other scientific studies that show the effectiveness of CBD in treating other types of health problems like acne, depression, and heart disease.

Delta-9 Tetrahydrocannabinol or THC was the known chemical compound used for scientific research. It was mainly used because of its abundance in marijuana. But THC affects your body. It causes you to feel "high" or being psychoactive. This has made issues for its legalization in the United States.

Before starting your own CBD business you should know that at the federal level, extracting CBD from marijuana is illegal. BUT there's an alternative way to get CBD and it involves hemp.

Hemp is part of the Cannabis family. Most people get confused and think marijuana and hemp are the same. No, it's not. Hemp and marijuana differ in terms of its uses. Marijuana is mainly used for medicinal and recreational purposes. Hemp, on the other hand, can be used for many different purposes. Hemp is known to be used on over 25,000 applications.

CBD oil can also be extracted from hemp. Without the "high" effects associated with marijuana, this oil works a lot differently than medical marijuana used today.

Still not convinced?

Then let me give you 5 Reasons to Start a Hemp-Based CBD Oil Business

1) Rising Industry

In 2017, around $820 million worth of legal hemp products were sold in the United States. Most of the sales came from the internet which comprises 60% of the sales. 21% came from smoke shops, 14% from natural and specialty retail, and 5% from healthcare. Don't be misled by the internet sales. They are expected to drop at most by 30% when more traditional retail options become available.

It's expected to reach sales of up to $646 million by 2022 with most of the sales will come from natural and specialty retail. It's also expected to be a $22 billion global industry.

In the United States, there are 19 states that allowed the growing of hemp. A total of 25,713 acres of land was used to grow hemp. A total of 1,456 licenses were issued to grow hemp. There are also 32 U.S universities conducting hemp-related research. And all that happened in 2017.

You might think that hemp is illegal to grow. In 2014, the U.S government approved the U.S Farm Bill. This allowed people to grow hemp. But you need to have the required registration and license for you to operate.

2) Studies Back Up Its Claims

A study in University of Colorado found out that CBD oil can be effective in reducing anxiety and insomnia. Mainly because CBD oil is an anxiolytic and sleep-inducing effect. Thou the patient was not using any pharmaceutical medicines and only CBD oil and nutritional supplements.

In Israel, multiple studies of CBD oil treatment for intractable pediatric epilepsy yielded promising results. The CBD oil treatment was used in children and adolescents. 89% of the children reported a reduction in seizure frequency. 18% of this reported 75-100% reduction, 34% reported 50-75% reduction, 12% reported 25-50% reduction, and 26% reported less than 25% reduction. 7% of the patients had CBD withdrawal.

Not only did it treated intractable pediatric epilepsy. Improvement in behavior, alertness, language, communication, motor skills, and sleep was also observed.

The future of hemp-based CBD oil is promising. There are many studies and research currently that are looking for more benefits in it.

3) Growing Popularity

Hemp-based products are all over the market. They can be found from food and textiles to medical treatments. Around 23% of hemp-based products are hemp-derived CBD oil. Even among hemp products CBD oil is the most popular. It's followed by personal care at 22%, industrial applications at 18%, food at 17%, textiles at 13%, supplements at 5%, and other products at 2%.

It's even featured on known news companies like CBS, Fox, CNN, and etc… CBD oil is growing in popularity. Much so that Oregon farmers are replacing their marijuana farms with hemp.

Even Sugarmade made some investments in hemp-CBD oil. They're looking at 23,000 acres of Kentucky farmland for hemp cultivation.

4) It Has Many Medical Uses

Hemp-based CBD oil has been known to treat acne, chronic pain, cravings, insomnia, inflammation, and anxiety.

Hemp seeds are also known as a source of protein, healthy fats, essential fatty acids, vitamin E, and minerals. Its soluble and insoluble fibers help promote digestive health. It also reduces the risk of heart disease. Hemp contains Omega-3 and Omega-6 fatty acids. This help improves skin complexion and relieves eczema.

5) It's a Product That Has Uses in Multiple Industries

Hemp is not only popular for its medical feats. With studies and experiments, there have been multiple discoveries of other uses of hemp. With further research, the full potential of hemp could be unlocked. The future is full of possibilities! Here are some of the discovered uses of hemp:

  1. Hempcrete - carbon negative construction

    This could be a good alternative to concrete. Hempcrete offers the same qualities as concrete. It's energy efficient, fire resistant, durable, low-maintenance, and cost-effective.

    1. Supercapacitors - powering electric vehicles

      Capacitors are supports for batteries with a short burst of high power. Researchers have found that hemp-based capacitors have the possibility to outperform traditional capacitors by nearly 200%. Compared to graphene, hemp is more cost-effective.

      1. CBD Food and Health alternative

        There are further researches to create common products out of hemp-based CBD. Some of these are health drinks, beer, chocolate, gummies, granola bars, and peanut butter. It's expected that by 2022, CBD will be the most popular hemp product on the market. Estimated sales could be up to $646 million.

Federal Laws and Legalities

Are you still worried about if it's a legal business to operate? Don't worry! Let's look back at the history of hemp being legalized. In 1600, Hemp was considered legal in Pennsylvania, Virginia, and Maryland. It was even encouraged to grow hemp to be used for making rope, sails, and clothing. In 1619, the Virginia Assembly even passed a law that required every farmer to grow hemp!

It was in the 1900s when recreational marijuana came to rise in the United States. In order to contain it, 29 states outlawed marijuana in 1931. By 1937, the Marijuana Tax Act was passed. The law banned the cultivation of hemp, marijuana, and other cannabis family plant.

But in the 1940's, farmers were encouraged to grow hemp. This was mainly because of the ongoing World War 2 at that time. Hemp was used to supplying the U.S army with ropes, parachutes, and other supplies. But the ban would be back when the war was over.

It was only in 2014 that hemp gained legality. The U.S Farm Bill was passed. It authorizes states to spearhead programs for hemp cultivation. As long as you have the required registration and certified by the state, you can grow hemp.

If you don't want to go over the process of getting all the registration and certificate, you can invest in hemp-based companies. But do make sure that the company you're gonna invest in has all the legal documents and they're allowed to operate.

Hemp-based CBD is completely legal. Take note Hemp-based. It's completely legal in all 50 states. But some states limit hemp operations. Some states don't even allow CBD products exported out of the state.

Also, note that most state only legalizes hemp-based CBD for medicinal purposes only. Thou some states allow Cannabis consumption for recreational purposes. These states are Alaska, California, Colorado, Maine, Massachusetts, Nevada, Oregon, and Washington. If you're not in these states you should look at the limitations of hemp-based CBD in your state.

In 2018, there has been recent progress of legalizing hemp-related products in all states. The 2018 Farm Bill is the step towards its legalization. This will remove all the limitations imposed upon the hemp industry. The 2018 Farm Bill contains the Hemp Farming Act of 2018. This will legalize hemp crops under federal law. It will be legal to sell hemp-based products in all 50 states without restrictions. This will make business operations and transactions a lot easier.


Although CBD is a vague and complicated field to explore, the reward is great. The hemp industry is on the rise. It's expected to grow into a $22 billion dollar industry once the 2018 Farm Bill is passed. There are studies that show promising possibilities of hemp-based products. Once all restrictions are off, large companies might make a move to invest in the hemp industry. This will accelerate hemp-related research.

A lot of people say hemp is the new gold rush and it might be. It's growing popularity is a testament to it. Even sales results are astounding. With sales increase of up to 20 times in just a year. Even a large company like Sugarmade has made investments. This speaks for itself the promise of a great profit in this industry. You could be a pioneer in the hemp industry and reap great profit before large companies make their move.

If you'd like to learn more about building a CBD-based business, check out my business on a budget ecourse.

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