Loads of people jumped for joy and rushed into planting hemp when it was made federally legal in the 2018 Farm Bill. Finally, 80 years after prohibition, a plant once commonly planted in the U.S. and touted as having 25,000 uses and worth a billion dollars according to a 1937 edition of Popular Mechanics Magazine, was back on the drawing board. What things can we make and do with hemp? How many million acres should we plant Industrial Hemp? How much money can we make on hemp?
But… not so fast. While the legalization of Industrial Hemp was an exciting and significant first step for the U.S. hemp industry, and hemp does indeed have a bright future, there is still more work to be done before there is a stable and reliable market for hemp growers.
That doesn’t mean there aren’t opportunities in hemp, not at all! There are more opportunities in hemp than can be fathomed and successful early adopters are rewarded with the most financial benefits when new markets emerge. But, savvy hemp farmers need a realistic understanding of the hemp market’s challenges and a good grasp of the risks before planting their first hemp crop.
Here are the five crucial things our experienced Industrial Hemp growing team at Colorado Breeders Depot wants you to know before planting hemp.
1) No, Hemp Doesn’t Grow Like a Weed
The first big myth surrounding hemp is that the oft-repeated pun it “grows like a weed.” Unfortunately, that’s not entirely true.
Yes, hemp can produce an insane amount of biomass — compared to corn, fiber hemp is estimated to produce 50 percent or even more biomass. But, you can’t just throw some hemp seeds into a field, walk away and expect a cannabis miracle. A profitable hemp crop needs to be approached with agronomic knowledge, experience and a plan for maximizing yield, just like any well-grown crop.
Hemp has pests. Initially, hemp growers reaped the benefits of being the first to grow Industrial Hemp in their region for decades. But now, as hemp has become more commonly planted, pests are coming out of the woodwork. Aphids, cutworms, flea beetles, earwigs, crickets, borers and caterpillars are all proving to be problematic for hemp growers as these voracious bugs discover a new delectable crop to devour!
There are multiple diseases and fungal outbreaks hemp is susceptible to. Many come on in the fall, when the weather gets damp, infecting valuable flowering colas. Blights, fusarium mold, powdery mildew and leaf spot are all potential problems.
High-value hemp grown for high cannabinoid profiles typically need to be irrigated and well-fertilized. Although there are many different ways to grow hemp, farmers need to understand their specific hemp crop and market from the get-go. Growing fiber hemp or tri-crop hemp like our Boax cultivar is a much different operation than growing niche, premium quality Industrial Hemp for the smokable market, for instance.
2) The Legal Status Surrounding Hemp is Still Evolving
Yes, hemp was legalized in the Farm Bill. Sort of.
While the Farm Bill defined hemp as a Cannabis sativa plant with under .3 percent THC (the psychoactive element in the cannabis plant). For many hemp farmers, this low THC limit ended up being problematic.
Hemp cultivars not appropriate for the region often “go hot” when stressed and test over .3 percent THC at maturity. But, because hemp has only been grown in the U.S. for a few years, only a few reliable hemp varietals (bred by knowledgeable hemp seed breeders) produce seed that can be trusted to remain below .3 percent THC while still producing high levels of CBD or other cannabinoids. To complicate matters more, though cannabidiol (CBD) was removed from the Controlled Substances Act at the same time Industrial Hemp was legalized — meaning CBD produced from the hemp plant was legal to grow and sell — there are still a lot of restrictions on how hemp-derived cannabinoids can be sold.
Under current U.S. Food and Drug Administration (FDA) rules, CBD (or other cannabinoids) cannot be legally sold as medicine unless approved. There is only one currently FDA approved medication made from CBD — Epidiolex, used to treat seizures. All CBD-based products must navigate a careful line of not boasting of medical benefits or risk the FDA’s ire. Also, the FDA does not allow any cannabinoids in food or beverage products and hemp-derived feedstocks have not yet been approved to be fed to animals.
Many states have also made separate rules limiting the sale and sometimes use of smokable hemp because of its appearance to illegal marijuana.
3) The Industrial Hemp Market is Not Stable Yet
Including all the unresolved legal issues around hemp, there is also a lack of products, secure markets, regulatory approval of its safety and reliable processing. Remember, nobody could grow hemp for 80 years. We have had to rediscover everything. U.S.-completed studies showing that cannabinoids are harmless for human and animal consumption are required for regulatory approval before cannabinoids can be legally infused into food products.
GRAS (generally recognized as safe) approval was awarded for Industrial Hemp seed and grain products in 2018, which was a good step forward. But CBD and other cannabinoids remain illegal when it comes to food and drinks. The FDA has said they will need more congressional authority (aka another law) before they can approve cannabinoids in food and beverage products.
Hemp produces a potentially valuable fiber (actually two types of fiber), but its valuable bast fiber requires extensive processing before it can be used in our current textile industry. The manufacturing processes for fiber hemp were abandoned when hemp was criminalized, now they have to being re-imagined to meet today’s standards and the infrastructure has to be rebuilt from the ground up.
4) Bad Actors Have Been Rife in Hemp
A sad side-effect of all the keen interest in a new hemp industry is that it provided many opportunities for bad actors and con artists to take advantage of U.S. farmers. Before the 2018 legalization, hemp production was allowed in limited states under trial authorization. When the supply was limited, the initial pay-out for CBD production was eye-boggling – even $100,000 or more in profit per acre.
Those insane numbers fueled a “Gold Rush” mentality into hemp CBD production in 2019. The overnight promise of big dollars brought into the industry many unsavory characters merely looking to make a quick buck. Whether it was outright scams, poorly performing or completely misrepresented hemp seeds, promises of logistical or harvest assistance that never materialized, the 2019 hemp season left many hemp farmers in the lurch.
The market price for CBD crashed dramatically. The price hemp farmers are getting for CBD biomass dropped nearly 80 percent between April 2019 and April 2020.
5) Yet the Future of Hemp is Still Huge
So why, after all this bad news, are we still so excited about hemp at the Colorado Breeders Depot? Because while the roadblocks are frustrating, the promise of hemp remains and the future is still tremendous for hemp in the United States. Hemp remains the planet’s more versatile and useful plant.
We must exercise patience. The hemp industry is still in its diapers when it comes to market potential. The first year after legalization and the significant drop in CBD prices was painful, but the good news is it quickly weeded out those that entered the industry with big talk but no substance. Good riddance!
The more we understand hemp, the more research is complete, and the more manufacturing industries learn how to use hemp for new products and build out new supply chains, the more stable the hemp market is becoming and the more it becomes as a reliable crop for farmers to add to their repertoire.
A few GREAT things to know about Industrial Hemp:
- CBD use is widely believed to have only penetrated 15 percent of households. Demand for cannabinoid products is still snowballing in beauty products and the pet market specifically.
- Research is being completed and lobbyists are working to pressure Congress for new legislation that would allow the FDA to approve cannabinoids in food and drink products, which would open up a substantial new market sector for cannabinoids.
- Lobbyists are also pressuring Congress to increase the total THC limit definition for hemp to one percent.
- Hemp fiber manufacturing is the subject of keen interest and private companies are investing millions into building out new fiber manufacturing processes. Consumer interest in hemp-produced fiber products is at an all-time high because of hemp’s sustainability compared to other fiber-based products (including cotton and timber).
- Hemp grain products and new foods from hemp grain are also increasing as consumers move to more healthy, high-protein alternatives.
- Hemp breeders are rapidly refining and greatly expanding available hemp varietals and now there are many hemp cultivars known to thrive in many different areas of the U.S (and the world).
- The USDA recently awarded $200,000 to a hemp lobbying group to research and promote U.S. marketing hemp to the world, indicating the U.S. government’s commitment to hemp.
- Applications are moving forward to permit hemp byproducts to be used in the feed industry. The feed industry is enthusiastic about the high nutrient profile leftover from hemp products.
- The more research we complete, the more we learn about the value cannabinoids other than CBD offer. Now there are rapidly emerging market sectors in CBG, CBN and other “minor” cannabinoids.
- The smokable hemp market has been booming for niche and high-quality growers willing to invest in hand-crafted and premium quality hemp.
- The international market demand for hemp is exploding as more and more countries come on board with hemp (and cannabis) legalization.
We could go on and on. Honestly, the future for hemp is, right now, more encouraging than it was in 2018 when the farm bill was passed. Back then, it was all mostly hypothetical. Now, we have legitimate hemp-derived industries and markets and more emerging.
We have to remember that the hemp industry is building itself up from ground zero. While that provides a lot of challenges, it also means — the sky’s the limit!
Here at Colorado Breeders Depot we believe the most important part of our job is helping our hemp growers find their path to profit. We evaluate, consult and advise our growers all the way through the process from assessing the market potential and risk, to teaching you how to grow hemp. Helping our customers have an excellent hemp harvest is what we’re all about. Phone – (719) 275-7770. Email – firstname.lastname@example.org.