Asia Pacific Industrial Hemp Market Outlook to 2030

Asia Pacific Industrial Hemp Market Overview

The Asia Pacific Industrial Hemp Market was valued at USD 1.78 billion in 2023. This growth is primarily driven by increasing demand for hemp-based products across various industries, including textiles, food and beverages, pharmaceuticals, and personal care. The rise in awareness regarding the environmental benefits of hemp cultivation, such as lower water usage and reduced need for pesticides, further propels market growth.

The Asia Pacific Industrial Hemp Market is dominated by Hemp Foods Australia, Ecofibre, Hemp Factory, Dun Agro, and Elixinol Global Limited. These companies have established a strong foothold through extensive product portfolios, strategic partnerships, and robust distribution networks across the region. Their focus on innovation, sustainable practices, and expansion into new markets has solidified their positions as leaders.

In 2023, Ecofibre announced an expansion of its hemp production facilities in Australia, aiming to increase its production capacity by the end of 2024. This expansion is driven by growing demand for hemp-derived CBD products in the region. Additionally, the company secured a major supply contract with a leading pharmaceutical company for the provision of hemp-based raw materials.

China has emerged as the dominant region in the Asia Pacific Industrial Hemp industry, with the largest market share in 2023. This dominance is attributed to China's large-scale hemp cultivation, advanced processing technologies, and well-established supply chains. The Yunnan province, in particular, has become a hub for hemp production due to favorable climatic conditions and government support, leading to its leadership in the market.

Asia Pacific Industrial Hemp Market Segmentation

The Asia Pacific Industrial Hemp Product market is segmented by various factors such as product type, Application and region etc.

1. By Product Type: The market is segmented by product type into fibers, seeds, and oil. In 2023, hemp fibers held a dominant market share due to their extensive use in the textile and automotive industries. The dominance of hemp fibers can be attributed to their superior strength, durability, and eco-friendly properties, making them a preferred choice for manufacturers. Additionally, the rising demand for sustainable textiles has further propelled the growth of the hemp fibers segment.
2. By Application: The market is segmented by application into textiles, food and beverages, pharmaceuticals, and personal care. In 2023, the textiles segment accounted for the largest market share, owing to the increasing use of hemp fibers in sustainable fashion and industrial textiles. The preference for eco-friendly materials in clothing and other textile products has been a key factor driving the dominance of this segment.
3. By Region: The market is segmented by region into China, South Korea, Japan, India Australia and Rest of APAC. In 2023, the North region, especially China dominated the market share, driven by its large-scale hemp production and favorable climatic conditions. The region's dominance is further supported by government initiatives that have encouraged the growth of the industrial hemp sector.

Asia Pacific Industrial Hemp Market Competitive Landscape

1. Hemp Foods Australia: Hemp Foods Australia introduced a new line of hemp-based snacks in 2024, targeting health-conscious consumers. The product line includes hemp protein bars, hemp seed snacks, and hemp-infused beverages, which have already gained popularity in major Australian cities like Sydney and Melbourne. The company expects to generate over USD 20 million in revenue from this new product line by the end of 2024.
2. Elixinol Global Limited: In 2024, Elixinol Global Limited entered the Japanese market with the launch of its hemp-based CBD products. The company has partnered with a Japanese pharmaceutical company to distribute its products across major cities, including Tokyo and Osaka. Elixinol expects its Japanese operations to generate USD 15 million in annual revenue by 2025, driven by the growing demand for CBD products in the country.

Asia Pacific Industrial Hemp Industry Analysis

Growth Drivers

• Expansion of Industrial Hemp in the Textile Industry: China produces 70% of the world's hemp output, a small but crucial portion of it is made into fabric, with the vast majority used for fuel, paper, or other industrial products. The increased use of hemp fibers has been supported by government incentives aimed at promoting sustainable practices in manufacturing, hemp is becoming a critical material in the industry.

• Growing Demand for Hemp-Based Foods: The food and beverage sector in Asia Pacific has seen a substantial rise in the incorporation of hemp seeds and oil as ingredients in various products. The health benefits associated with hemp seeds, such as high protein content and omega-3 fatty acids, have driven this demand. Countries like Japan and Australia have led this growth, with major food companies launching new hemp-based products to cater to health-conscious consumers.
• Increasing Use of Hemp in Construction Materials: In 2024, over 100,000 homes in Australia and New Zealand utilized hempcrete as a primary building material, driven by its insulating properties and environmental benefits. The growing adoption of green building practices, supported by government regulations, has accelerated the demand for hemp-based construction materials.

Challenges

• Competition from Synthetic Alternatives: Despite the environmental benefits of hemp, the market faces stiff competition from synthetic fibers and materials. The lower cost and established supply chains of synthetic fibers make them a preferred choice for many manufacturers, limiting the market share of hemp-based products.

• Limited Consumer Awareness and Acceptance: While industrial hemp has gained popularity in certain markets, overall consumer awareness and acceptance remain limited. This lack of awareness, coupled with misconceptions about hemps association with cannabis, has hindered its adoption. Educating consumers about the differences between industrial hemp and cannabis, as well as the benefits of hemp products, is essential for driving future market growth.

Government Initiatives

• Indias Pilot Program for Hemp Cultivation: The Uttarakhand government has developed a scheme that allows individuals and companies to obtain licenses for hemp farming, storage, sales, and transport. Also Himachal Pradesh could soon see hemp legalized, according to signals from recent government deliberations. A committee headed by state Revenue Minister Jagat Singh Negi has recommended allowing controlled cultivation of hemp for non-narcotic use.

• Japans Regulatory Reforms: In 2023, Japan made amendments to its Cannabis Control Act for the first time in 75 years, which included relaxing regulations around the hemp and CBD industries. These changes aimed to facilitate the growth of Japan's nascent cannabis market, particularly in the CBD sector. These measures are expected to attract more investments into Japans nascent industrial hemp market.

Asia Pacific Industrial Hemp Market Future Outlook

The Asia Pacific Industrial Hemp Market is projected to grow exponentially by 2028. The markets future is expected to be shaped by increasing applications of hemp in emerging industries such as bioplastics and construction materials. Moreover, favorable government regulations and the growing acceptance of hemp-based products in various sectors are likely to further boost market growth.

Future Trends

• Growth of Hempcrete in Green Building Projects: The construction industry is expected to see a continued rise in the use of hempcrete as a sustainable building material. Asia Pacific region will be built using hempcrete, driven by government incentives for green building practices and the materials superior insulating properties. This trend will be most prominent in Australia and New Zealand, where the demand for eco-friendly construction materials is growing rapidly.

• Integration of Hemp in Functional Foods and Beverages: The functional foods and beverages market in Asia Pacific is expected to witness growth in the incorporation of hemp as a nutritional ingredient, supported by rising health consciousness among consumers. Countries like China and India are expected to lead this trend, with major food and beverage companies launching new hemp-based products to meet consumer demand.