For centuries, hemp has been cultivated in China, but only recently have regulations on production, processing and use been liberalized. The rules are often opaque, incomplete, and vary from province to province. As hemp and hemp products become more popular among consumers, governments in traditional hemp-growing regions are creating regulations to accommodate the growth of the CBD industry. CBD products derived from hemp are becoming available, and local provinces are drafting regulations, but many believe a national framework is needed.
Hemp has been a source of interest for entrepreneurs for some time, and while the United States is experiencing a CBD boom, it's easy to forget that hemp is a global phenomenon. Zhang from the Economic Crop Research Institute acknowledges the potential of the hemp industry, but also advocates for a sensible approach. The sale of biomass is only allowed internationally; the upper part of the hemp flower must be exported and CBD products are illegal. Yunnan has begun to explore the processing of hemp for cannabinoid use, while Heilongjiang province in the far northeast of China is still mainly focused on growing and processing fiber.
In 2018, Heilongjiang approved a special action plan to regulate and promote hemp cultivation and extraction, though it does not explicitly mention CBD. The HMI Group owns one of the first companies to obtain a hemp cultivation license in Yunnan province. This small country, roughly the size of West Virginia, is already one of the largest hemp producers in the European Union, and production could increase with pending legislation that would allow farmers to create products using the entire plant. China produces about half of the world's supply of hemp fiber according to the FAS, making it the largest producer of hemp fiber in the world.
Jilin province has taken similar steps and is expected to be the third province to liberalize hemp cultivation and processing. After a 14-year ban, Germany legalized hemp cultivation in 1996 and there has been an increase in demand for products derived from it. Hemp planting, cultivation and harvesting are allowed as long as the plant does not exceed 1% THC and is used for medical, scientific or research purposes. In recent years, consumer demand for hemp-derived products containing CBD - mostly cosmetics - has started to rise, attracting investors and entrepreneurs.