You know that a new supplement has reached critical mass when Vitamin Shoppe and Walgreens are carrying it. CBD oil is just about everywhere these days. You almost can’t even leave the house without finding someone selling CBD. It’s sparked a lot of curiosity among those who aren’t already using it. If you’re among those curious individuals and have already done a little research, you’ve seen what CBD oil prices are like. They’re often very high. So, how much should CBD oil cost? If you really want to give CBD a chance and find out whether it can make a difference in your life, how much can you expect to pay? Let’s learn more about why CBD is so expensive and get a better idea of what a fair price for CBD oil would be.
What Is CBD Oil?
In case you’re not familiar with it, we’ll begin with a brief explanation of CBD. CBD is a hemp oil extract made from industrial hemp plants. Hemp is the same plant as cannabis. While most cannabis plants are cultivated for the maximum possible concentration of psychoactive THC, though, industrial hemp is bred for other purposes. You can’t get high from smoking industrial hemp, but it is rich in cannabinoids other than THC. CBD oil captures those cannabinoids – the most plentiful of which is CBD – in the form of an essential oil.
Although CBD oil doesn’t produce the euphoria of THC, scientists are finding that it may have a variety of health benefits. People are taking CBD oil to ease chronic pain, reduce anxiety, improve sleep quality and more.
Why Is CBD Oil So Expensive?
Questions Surrounding Hemp Legality
Since it’s nothing but an extract from a plant that grows like a weed, you’re probably wondering why CBD oil costs as much as it does. To understand that, you need to know a bit about the complicated history of the hemp industry. Once farmed by such illustrious Americans as George Washington and Thomas Jefferson, the U.S. government subjected the hemp industry to a putative tax in 1937 that effectively ended commercial hemp farming for decades.
Hemp production in the United States began to resume in the late 2000s when states started to enact their own medical marijuana laws. When hemp became legal in states such as Colorado and Oregon, farmers resumed growing those crops. According to federal law, though, hemp and hemp extracts remained Schedule I drugs under the Controlled Substances Act – not legal for any purpose.
The confusion over CBD legality at the state and federal levels continues to this day. In 2018, President Donald Trump signed the 2018 Farm Bill into law, making it legal at the federal level for farmers in all 50 states to grow hemp containing no more than 0.3 percent THC. You might think that would have given CBD oil brands the green light to market their products freely, but no; hemp extract remains a Schedule I controlled substance. The government simply hasn’t enforced the CBD prohibition except when companies have made unproven medical claims about it or marketed it as a health supplement.
High Expenses for CBD Hemp Growers
As explained above, CBD products remained prohibitively expensive for a long time because it took domestic farmers many years to ramp up their hemp production. CBD oil producers, therefore, had to import many of their materials – and that had its own challenges. Today, farmers in all 50 states can cultivate industrial hemp without violating federal law. A few states, however, still prohibit hemp farming. In states that have industrial hemp programs, it still isn’t as simple as tilling your field and growing your crop. Farmers must register themselves as hemp growers and pay for the appropriate licenses.
Things only get more costly from there.
When you grow hemp for its fibers, you can plant the seeds close together because the fibers are in the stem of the plant. When you grow hemp for CBD, though, you have to space the plants further apart because the CBD-rich flowers need room to develop. Getting less usable material per acre reduces the farmer’s potential profits. In addition, CBD oil producers are only interested in plants with high CBD yields. The seeds for hemp plants guaranteed to meet CBD producers’ requirements for high CBD content – and the federal government’s requirements for low THC content – can cost up to $2.00 each.
Industrial hemp grown for CBD can be worth up to $40,000 per acre. Compare that to the value of a traditional cash crop such as corn – up to about $800 per acre – and the appeal of hemp becomes obvious. The problem, though, is that hemp farming hasn’t been mechanized in the way that other crops like corn and wheat have. Raising a hemp crop for CBD production is difficult to do on a large scale, and it requires a great deal of manpower. Despite the high value of CBD hemp, some farmers have actually lost money growing it.
Costs of CBD Oil Production
If you think that the costs for CBD hemp farmers are high, let’s do a little math on the costs of CBD production. Suppose a CBD producer buys an acre of hemp flowers at a cost of $40,000. That’s around 1,000 pounds of hemp flowers, from which it’ll be possible to extract around 75 pounds of CBD. That’s about 34 million milligrams of CBD.
Sounds like a large amount of CBD, right? Not so fast; converting full-spectrum CBD oils to other products such as CBD capsules and CBD isolates results in losses at every step of refinement. You’ll lose a lot of product getting from a raw CBD oil to a finished product like a CBD tincture.
From there, you’ll still have to invest in packaging, labels, distribution, marketing and more. Marketing CBD is more difficult and expensive than for many other types of products because the most popular advertising channels – Facebook and Google AdWords, to name two examples – don’t distinguish between CBD oil and other types of cannabis products. You therefore can’t advertise CBD oil on those channels.
When it’s time to actually sell your product, you’ll find that few credit card processors will actually want to work with you. Those that do will label you a “high-risk” merchant due to the legal questions surrounding the CBD oil industry. They’ll charge more to process your transactions.
At the end of the day, there is plenty of potential profit in the CBD oil industry. It’s a long road to get there, though, and it requires far more time and money than most consumers realize. You cover a portion of those costs every time you buy a bottle of CBD oil.
Does Better CBD Oil Cost More?
Here’s the million-dollar question: Is expensive CBD oil better than cheap CBD oil? To a certain extent, it may be. After all, not every CBD oil comes from Colorado’s finest organically grown hemp. Some CBD oil brands cut corners. Rather than buying expensive domestic hemp, they buy cheap hemp oil or CBD isolate from exporters in China for a fraction of the cost. They use plastic bottles rather than glass. They don’t send their products to third-party labs for testing. All of those decisions can reduce the cost of the finished product, but they can also degrade the product’s value.
Wouldn’t you like to know the exact CBD content of a product before buying it? Wouldn’t you like an outside lab to verify that the oil contains no heavy metals, pesticides or solvents? Wouldn’t you like to know that it’s free of THC but full of natural plant terpenes? When you buy an expensive CBD brand, those are the things that you’re paying for. The best cultivation, production and testing methods do make CBD oil more expensive. The fact is, though, that a CBD product that doesn’t bring you real benefits has no value at all.