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Controversial Crop

Kentucky agriculture officials
push hemp as a new cash crop

State joins eight others in passing law
to allow it if federal ban is lifted

“As long as it’s legal,
there’s money to be made
(in growing hemp).”

­– Jonathan Turner,
Trimble County, Ky., farmer

Cover
2013 August
Edition Cover

(August 2013) – If industrial hemp could be as profitable a crop as tobacco, Bedford, Ky., farmer Jonathan Turner says he would consider growing it – that is, if the federal government ever lifts the ban on its production. Like marijuana, growing hemp is illegal in the United States.
So for now, Turner has to stick to raising his 92 acres of tobacco.
And tobacco is back-breaking work, even with today’s technological advance in farming equipment. Turner farms the land on which he grew up and on which his parents farmed along the Ohio River. It is located on Wise’s Landing Road near the Trimble County LG&E plant.
Agricultural officials have long been debating the legalization of hemp production in the Commonwealth of Kentucky. And state legislation was passed in recent weeks to allow Kentucky farmers to begin producing hemp, should the federal government lift its ban. Kentucky Gov. Steve Beshear allowed the measure to pass into law, and both U.S. Sens. Mitch McConnell and Rand Paul, support hemp production.
State legislators also added an amendment to Senate Bill 50 to allow colleges and universities to grow hemp for research purposes because many believe there are untapped sources for industrial hemp production in a state that was once a leading hemp producer.
“As long as it’s legal, there’s money to be made,” said Turner, 41.

Senate Bill 50

Senate Bill 50 was passed in the Kentucky General Assembly in the final hour of the legislature's 2013 session. It will take effect in the summer of 2013. The goal of Senate Bill 50 is to help Kentucky move to the forefront of industrial hemp production and commercialization of hemp products.

Senate Bill 50:
•  Calls on the University of Kentucky Agricultural Experiment Station, as well as other Kentucky public universities, to conduct research on hemp planting, cultivation, and analysis on demonstration plots

•  Establishes the membership of the Kentucky Industrial Hemp Commission

•  Directs the commission to establish and oversee a five-year hemp research program.

•  Provides that the commission shall work with the UK Center for Applied Energy Research to study the use of hemp in new energy technologies and work with the Kentucky Cabinet for Economic Development to raise awareness of financial incentives for businesses that manufacture hemp products

•  Sets up a fund to finance the administrative services of the commission and the industrial hemp research program

•  Charges the commission with establishing a program to license Kentucky hemp growers

•  Requires the Kentucky State Police to perform background checks on producers who apply to grow industrial hemp

•  Sets out record-keeping and filing requirements of industrial hemp growers, and establishes penalties for failing to comply

• Affirms that information on hemp grower applications is proprietary and is subject to inspection only under a court order

But there are factors to consider, such as labor and the possibility of having to purchase new equipment to harvest the hemp. As a farmer who depends on his crops to live, Turner would have to see his investment pay off, while using less labor-intensive methods. He would also have to be among a handful of farmers who would be selected to raise the crop and obtain a special permit to do so.
Turner farms close to 700 acres and leases close to another couple hundred between a nearby farm and a third farm near Bray’s Orchard on Hwy. 42. He is the largest producer of tobacco in Trimble County. Turner also raises 33 acres of corn and 40 acres of hay, and has 60 cows. He crams 30 hours of work into each 24-hour day.
He said the idea of growing industrialized hemp may appeal more to a younger generation of farmers. If there is not much more effort involved in growing hemp than tobacco, the chance is worth it. He certainly has the experience at growing agricultural crops, but he’s not sure if the same fertilizers and techniques are used in growing industrial hemp.
To Turner and many others like him, it’s worth a shot.
The Kentucky General Assembly passed its “hemp bill” in March. The bill established a regulatory framework for the production and marketing of industrial hemp if federal policy should change or if the state could obtain a federal waiver.
In a press release, Kentucky Agriculture Commissioner James Comer, a staunch supporter of industrial hemp, said, “Without a doubt, this was an historic day for industrial hemp in America. Not just Kentucky, but America.”
The agriculture department released a statement that the University of Kentucky College of Agriculture and the Cooperative Extension “have long supported all efforts to develop new opportunities for Kentucky farmers. We applaud Commissioner Comer’s leadership in pursuing opportunities for industrial hemp.”
Due to a resurgence of interest in the production of industrial hemp, the University of Kentucky College of Agriculture began evaluating the economic side of production several months ago. The College released its report on July 25, and its projections for wholesale hemp production in Kentucky is not so promising.
“If political challenges are overcome, enticing processing interests to locate in Kentucky, along with production research, will be critical to capitalize on a relatively small, but expanding niche market for hemp products,” said Will Snell, one of the study’s authors. Other UK agricultural economists involved in the study included Lynn Robbins, Greg Halich, Carl Dillon and Leigh Maynard. Dave Spalding, extension associate in the UK Department of Horticulture, also contributed.
Hemp is grown in more than 30 countries. China boasts the most acreage, but Canada, the United State’s likely chief competitor, is beginning to influence both production and trade. Their acreage has grown steadily over the past five years, and the Canadian government provides grants and no-interest loans to support production.
Hemp can be grown for both fiber and seed. Some people have talked about the potential for industrial hemp fiber to be a major market for Kentucky farmers.
“Based on what I’ve seen, that is not going to happen in Kentucky,” Halich said. “If people are doing this to make money, it’s going to be on the oilseed side, not on the fiber side, at least in the foreseeable future.”
To obtain the most value from the long hemp fiber, the outer layers of the stalk must be removed, a process known as decortification. Cost-effective mechanization for this has not been available. Using Canada as a model, profitable opportunities to date have been largely limited to seed and oil production.
“In the end, fiber production is going to depend on a processing plant being fairly close and willing to pay a high enough price to entice farmers to switch over to grow it,” Halich said.
The hemp oil processing chain is fairly well established. Maynard, however, spoke with a representative of a Canadian processing company who said even a large oil customer that might use 30,000 pounds of hempseed oil per year would support only 96 acres of production.
“None of the processors with whom I spoke—and some of these are well established companies in Canada— none of them thought it was going to be an activity that would produce large numbers of employment or require large numbers of acres,” Maynard said.
For about 15 years in the middle of the 19th century, Kentucky was one of the major hemp producers in the country, until cotton and imports of other materials became more popular. During World War II, industrial hemp production peaked for the manufacture of, among other things, rope and twine for the war effort. Kentucky, with its 52,000 acres, claimed about 10 percent of the market share.
Settlers traveling westward through Kentucky in the early 1800s took hemp seed with them. The hemp fibers were used for rope, sailcloth, pants and rough fabrics used to wrap bales of cotton. Until the late 1880s, hemp was used for virtually all paper production and even used as money. The Declaration of Independence, signed in 1776, was written on paper made of hemp.
Lexington, Ky., became the center of hemp production in the early 1800s. By 1838, there were 18 rope and bagging factories in the Lexington area, employing 1,000 workers. Lexington resident John Wesley Hunt, the first millionaire west of the Alleghenies, made his fortune by cultivating hemp and manufacturing the fibers into rope.
Up until the Civil War, Kentucky led the nation in industrial hemp production, a process that continued to flourish through World War II. During the war, the federal government launched a “Hemp for Victory” campaign that urged people to grow hemp to make ropes for military use.
Today, though the U.S. market for hemp-based products is a shadow of what it once was, it is growing, driven by a dedicated base that is interested in natural foods and body care products. There is no expectation, however, that hemp will ever be anything like tobacco, which was highly profitable in many years.
Still, nine states – including Kentucky – have passed laws enabling farmers to grow industrial hemp should its production ever become legal.
To raise industrial hemp, farmers would have to obtain a permit from the U.S. Drug Enforcement Agency. Warren Beeler, Director of Agriculture Policy for the Kentucky Department of Agriculture, said there would be other restrictions. A license must be obtained from the Hemp Commission, a criminal background check must be done on the grower, GPS coordinates of the hemp field must be made, the grower must report the kind of seeds that are grown and who he sells it to and there is a minimum 10-acre plot size.
“I’ve studied and studied the issue,” Beeler said. “There is one thing that is unique about hemp. It has a tremendous amount of opportunity on the marketing side.”
Beeler said that one acre of hemp equals the four acres of trees needed to make paper. “It takes 150 days to grow hemp and 15 years to grow trees.” He believes it depends upon the genetics, if it is to be profitable at a farm level.
“It has potential. I don’t take it lightly,” said Beeler. But he wonders if enough research can be done to upgrade equipment to process hemp in and out of the field.
If successfully legalized, many advocates believe industrial hemp could be a possible replacement for tobacco, once a large cash crop for Kentucky farmers. “Tobacco is still a huge player in Kentucky. But it’s different than it used to be,” said Beeler.
Oldham County farmer Tom Deibel believes “it will take a lot of doing to make hemp a viable crop income for farmers.” While he said there are products hemp can be made into, “you have to have a market for them.”
Many individuals are beginning to see the value hemp could bring to the economy and the environment. Possible products include fuel, textiles, paper, soaps, lotions, cosmetics, car parts, building materials and so much more. Hemp can remediate soil damage and absorb tons of carbon dioxide annually.
Deible thinks that at first, “hemp may flood the market until we develop a market for the products.” He conceded that it may be “a viable alternative in the future, but not at first.”
Beeler said that although there are many uses for hemp, he has his doubts about its success in the United States. “ I don’t know if we know how to raise and process it correctly.”
Opposition to its production comes primarily from law enforcement, which receives federal money on the state level to combat illegal marijuana production. Opponents say hemp is too closely related to the marijuana plant. Both are actually part of a diverse plant species of more than 500 varieties.
For this reason Beeler said, “I can see why law enforcement officials are so shook up about it.” It is hard to physically distinguish between hemp and marijuana. Marijuana contains a high level of THC, the compound that produces the drug’s high. Hemp has trace amounts of THC.
Beeler conceded that it is possible to “cross pollinate the two plants, but this makes terrible marijuana. It takes the THC levels way down. Marijuana folks will be the ones to fight this the hardest.”
He said officials would know exactly where the hemp plots are by GPS, and that the plots would be inspected while growing. “The last thing we want to do is promote marijuana,” he said.
State Sen. Rick Rand of Bedford said, “I think there is broad agreement that if the federal government clears the way for industrial hemp, and the market proves as profitable as hoped, there could be some potential for farmers that want to go in that direction. I say that because we have great growing conditions, and Kentucky farmers have truly embraced diversity, with 10 different commodities bringing in at least $100 million a year. The issue is now out of our hands at the state level, but with the General Assembly’s passage of Senate Bill 50 this year, farmers can rest assured that we will be ready to act quickly if Washington gives the go-ahead.”
Like Rand, Beeler is waiting to get the waiver from the federal government. “We (Kentucky) just wanted to be the first,” said Beeler, “to get the infrastructure in and create jobs. Kentucky could be the center of putting together the process.
“This is not a Republican or a Democratic idea. I’m still hopeful that there will be a future for industrial hemp in Kentucky.”

• To learn more about industrial hemp production in Kentucky, visit the Kentucky Department of Agriculture’s website at: www.kyagr.com and search for “hemp.” The full report released by the UK College of Agriculture can be viewed online at: http://bit.ly/12mZ11e.

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