TraceGains Solutions
Hemp Industry

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CBD has Become Big Business and the Stakes are High

For years, hemp and cannabidiol—better known as CBD—have been relegated to the fringes of the CPG market. But with the passage of the 2018 Farm Bill, CBD broke into the mainstream. The industry grew to $2.9 billion in 2020, and analysts predict it will reach $40 billion by 2027, with a combined annual growth rate of 46.4%.

Hemp has had a lengthy legal battle in the United States. In the 19th century, hemp was in most paper and textile products, but its popularity waned when cotton proved easier and less expensive to process. The Marijuana Tax Act of 1937 strictly regulated the cultivation and selling of all cannabis varieties. The Controlled Substances Act of 1970 classified all forms of cannabis, including hemp, as Schedule I drugs. Even with dramatic growth and new laws, several challenges are facing the hemp industry.

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Negative Public Perception
The biggest challenge facing anyone in the hemp industry is the negative perception of CBD products among the public. Many people believe hemp products are the same as marijuana, which remains illegal in many states. There is a misconception that CBD products cause highs like marijuana because both hemp and marijuana come from the same cannabis family.


Bad Actors
The popularity and booming growth of CBD, combined with hemp's illegal past, has attracted bad actors and cutthroat activity. There is a wild west "gold rush" mentality that increases risk. For the many companies that have not yet matured to meet professional standards, it's crucial to know the facts and work with knowledgeable, competent professionals to avoid complicated and costly legal matters.


Regulatory Uncertainty
Since the 2018 Farm Bill became law, food and supplement companies have been working overtime to determine what it means to them, their products, and their businesses. State attorneys general are enforcing new laws and regulations on agriculture, extraction, manufacturing, and transport. As a result, companies in the CBD business have a patchwork of state laws to navigate.

Why Hemp and CBD Matter

Used to treat a wide variety of conditions and symptoms, hemp-derived products have shown surprising efficacy. They offer therapeutic benefits without the high-generating THC. The benefits of hemp have been documented in dozens of published research studies.

Reported benefits of CBD and Hemp:

  • Digestion: Hemp seeds are a good source of protein and fibers, both soluble and insoluble for digestive health.
  • Heart Health: Arginine and GLA content in hemp seeds can reduce the risk of heart disease.
  • Acne and Eczema: Omega-3 and Omega-6 content fatty acids help improve skin, acne, and even eczema.
  • Anxiety and Pain Relief: CBD supplements can treat conditions from anxiety, chronic pain to discomfort associated with treatments.
  • Childhood Epilepsy: CBD has shown to reduce and even stop childhood epilepsy syndromes, such as Dravet and Lennox-Gastaut syndroms (LGS).

TraceGains Can Help

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Smart business leaders in the hemp industry know that professional standards matter. With TraceGains solutions, businesses can achieve the supply chain transparency needed to demonstrate compliance and satisfy customer needs. Offering a collaborative platform that connects teams, streamlines workflows, and digitizes documentation, you can plug into a global network from anywhere in the supply chain. The system automates and tracks supply chain partner information and document exchange, with key product details and compliance documentation available with the click of a button. In addition, a network of Hemp experts can help you navigate legal and regulatory issues with confidence.

Attract New Business with Market Hub

Market Hub allows CBD and hemp suppliers to get their products in front of potential customers in the food and CPG industry. Leveraging the standardized hemp form built by our team of experts, suppliers use PostOnce® to make their raw materials, ingredients, and products instantly available to everyone in TraceGains Network. In a fast-moving market, Market Hub helps suppliers and manufacturers get new products to customers in record time.

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Established Network
Take advantage of the industry’s largest network which includes 40% of the Top 100 Food & Beverage companies.

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Improved Customer Communications
Provides a networked platform that connects CPG industry brands and suppliers for collaboration and transparency.

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PostOnce® Technology
Suppliers can submit information, documentation, and online forms to all customers at once.

Gain Momentum with Industry Standards

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For the hemp business model to continue to expand, industry standards are required. TraceGains has long been responsible for defining standards in the food and CPG industry by creating standardized documentation that allows suppliers to meet compliance requirements for multiple customers by completing and posting each document in TraceGains Network once. By working closely with experts in the hemp industry, TraceGains has created a standardized document for hemp suppliers that contains elements like THC potency, pesticides, microbes, residual solvents, heavy metal content, and many other items. As the TraceGains hemp community grows, so will the depth and breadth of the document and its impact on industry standards.

"TraceGains has a long history of protecting consumers, manufacturers, and distributors by ensuring the highest level of transparency in safety and compliance. We reviewed several options, but only TraceGains gives manufacturers and distributors the ability to validate CBD providers are fully compliant with the 2018 Farm Bill.”

- Eric Wang, Managing Director

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