Legal Weed Is Causing Problems for America’s Hemp Farmers

by Kristen Gwynne
Source: vice.com

Hemp farmers leading the charge for the plant's production in the United States are not down with the marijuana policy reform movement. In fact, they do not even want to be associated with it. Despite the similarity of the two plants, both of which are banned by the federal government, hemp advocates say the stigma associated with marijuana is getting in their way of achieving reform.

Concerns among drug enforcement agents that allowing hemp production may complicate marijuana eradication efforts is hindering the legalization of the hemp market. So to distance themselves from authorities' main concern—that pot that gets you high—hempsters are ditching their association with the activists fighting for marijuana legalization.

A non-psychoactive "sober cousin" to pot, hemp contains less than 1 percent THC, the active ingredient in marijuana, but is categorized under the Controlled Substance Act just as strictly (the drug, by contrast, contains between 3 and 15 percent THC). Despite the marijuana policy reform movement's success in recent years, hemp advocates fear a backlash against legal weed could take them down as well.

"My business has nothing to do with marijuana," Ken Anderson, a Minneapolis provider of hemp-based products recently told Business​week. "The two need to be considered separately."

Unfortunately for Anderson and other hemp industry players, separating the plant from the drug may be a difficult goal to achieve, at least in terms of perception. For the legalization movement, hemp provides a useful rhetorical tool: It is billed as an environmentally friendly, versatile crop with economy-boosting potential, and its illegality highlights the futility of prohibition while underscoring the benefits of legalization.

Still, hemp advocates point to their success in states less likely to be friendly to marijuana legalization, like Kentucky, which passed a law legalizing hemp production in 2013. Both of the state's US Senators—Republican Leader Mitch McConnell and Rand Paul—support hemp legalization, and were key supporters of a pilot program under the 2014 Farm Bill that allows hemp production for research purposes. Under these new laws, the University of Kentucky has already planted its hemp crop, and seven state universities are studying the potential of the hemp industry.

"The utilization of hemp to produce everything from clothing to paper is real, and if there is a capacity to center a new domestic industry in Kentucky that will create jobs in these difficult economic times, that sounds like a good thing to me," McConnell said in a ​statement earlier this year.

But the legal resurgence of hemp is still tinged with doubts about the crop's potential. Aneditorial in t​he Lexington Herald-Leader titled "License hemp but don't oversell; crop no game-changer" begins with an endorsement of Kentucky's new hemp policy, but cautions against overstating the benefits. "[W]e stand by our longstanding support for legalizing industrial hemp production," the paper wrote. "But make no mistake about it, industrial hemp will not transform Kentucky's economy."

"It does not appear that anticipated hemp returns will be large enough to entice Kentucky grain growers to shift out of grain production," citing a study from the University of Kentucky that found a growing, but still relatively small market for hemp.

"Realistically, I think it may be another option for some farmers but it's not going to be a major agricultural panacea," Dr. Leigh Maynard, chairman of the University of Kentucky's Department of Agricultural Economics, which conducted the study, told a local news​paper.

The study was not the first, nor the last, to present less-than-optimistic findings about the hemp industry. In a report on indus​trial hemp, the US Department of Agriculture said that the market for hemp as a food ingredient is "unknown" and likely to "remain a small market, like those for sesame and poppy seeds." The ​report found that hemp fiber will also "likely remain, a small, thin market" because "cotton, flax, abaca, sisal, and other nonwood fibers" will be difficult to compete with in terms of quality and price. Meanwhile, the USDA found that the production of hemp oil also faces hurdles in manufacturing, including its "limited shelf life."

"Some consumers may be willing to pay a higher price for hemp-seed-containing products because of the novelty, but otherwise hemp seed will have to compete on taste and functionality with more common food ingredients," the report said.

Hemp is also billed as an environmentally safe industry, but its modest environmental impact (no herbicides and just a few pesticides are necessary to produce the plant) is offset by other environmental factors. Modern Farmer noted that hemp "requires a relatively large amount of water, and its need for deep, humus-rich, nutrient-dense soil limits growing locales."

Global competition for a product with little demand may also not be particularly fruitful. According to the University of Kentucky researchers, "[t]he world market for hemp products remains relatively small, and China, as the world's largest hemp fiber and seed producer, has had and likely will continue to have major influence on market prices and thus on the year-to-year profits of producers and processors in other countries."

The USDA also notes that "Canada is emerging as a growing influence on the global hemp production and trade," enduring a volatile market. Hemp production bounced from 35,000 acres in 1999 to 4,000 in 2001 before production shot up to 48,000 acres in 2006, dipping down to 10,000 two years later, and springing up to 39,000 in 2011.

In Kentucky, the small size of the market could also means fewer jobs than has been predicted. While Agriculture Commissioner James Comer predicted that hemp production may create hundreds of new jobs in the state, recent reports suggest the numbers might be in the dozens, and possibly as l​ow as 25.

"If Kentucky's hemp industry would materialize to the size of the Canadian hemp industry, projected gross sales would total less than one percent of current Kentucky farm cash receipts," one University of Kentucky report conclud​ed.

So as the hemp industry begins to navigate the minefield that comes with establishing a new market, industry producers may be smart to take whatever support from the legalization movement that they can get.