Business

Hemp's moment finally here, proponents say

Legislature to again weigh cannabis crop's future

Proponents of industrial hemp are hopeful that Iowa legislators this year will approve a program for the crop in Iowa. (Katherine Frey/Washington Post)
Proponents of industrial hemp are hopeful that Iowa legislators this year will approve a program for the crop in Iowa. (Katherine Frey/Washington Post)
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Proponents of industrial hemp are hopeful that state lawmakers soon will sign off on a profitable alternative crop for Iowa farmers.

“I’m very optimistic,” said Christopher Disbro, president of the Iowa Hemp Association. “We’ve been in contact with a great group of bipartisan legislators.”

Sen. Kevin Kinney, who co-chairs the Legislature’s Industrial Hemp Program Study Committee, also is optimistic about the future of hemp.

“It’s going to be an industry that’s going to grow,” Kinney said. “There’s a lot of potential — everything from makeup to fiber to clothing to food.”

Legislation that would enable an industrial hemp program in Iowa passed the Senate 49-0 last session but died in the House.

“I have put in a bill request that would be identical to the last time,” Kinney said last week ahead of the new legislative session that starts Monday. He expects Sen. Tom Shipley, R-Nodaway, to co-sponsor.

“We’re going to work together,” Kinney said. “We’ve worked together for three years, and we don’t want to lose our place.”

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Effectively banned under federal law since 1937, hemp cultivation in closely monitored pilot programs became legal under the 2014 farm bill. The new farm bill passed late last year further eased restrictions, allowing hemp-derived products to be transported across state lines and removing restrictions on their sale, transport or possession.

Amid those changes, interest in industrial hemp is running high, said Angela Rieck-Hinz, an Iowa State University Extension field specialist based in Clarion.

“I’ve probably had four or five dozen phone calls since the farm bill was passed,” she said. “We’ve had some pretty low profit margins on corn and soybeans the last couple years, and they’re always looking for that third crop. People are looking to see if they can get in on the ground floor.”

Hemp and marijuana come from the cannabis plant. Under federal law, industrial hemp can’t contain more than 0.3 percent tetrahydrocannabinol, marijuana’s psychoactive ingredient. Recreational marijuana typically contains 40 percent THC, while medical marijuana derivatives are limited to 3 percent THC in Iowa.

Hemp backers have argued for years that the eight-decade federal ban on any hemp cultivation stalled development of a useful resource. They say hemp and its derivatives processed for fiber, seed and oil can be key ingredients in everything from cattle bedding to cloth, insulation, high-protein feed, fuel and biodegradable plastics.

With the end of federal sanctions, Disbro and others say that deferred potential is about to be realized, although the kind of markets farmers are familiar with are just starting to develop.

“With a new commodity like this there’s going to be a little wiggle room,” said Disbro, a medical doctor who learned of hemp’s properties through the debate over medical cannabis. Products containing cannabidiol, or CBD, the cannabis compound with claims to significant medical benefits, already are on store shelves in some markets. “I know a lot of people who were growing for CBD and are now growing for fiber and grain. I think there is plenty of market. We’re going to be able to move this forward.”

States have the option of developing their own hemp programs — the federal law requires states’ chief law enforcement officers be included — that must be approved by the U.S. Department of Agriculture. Farmers still could plant hemp without a state program, but they’d be subject to direct federal regulation. Iowa is one of just 11 states without its own program.

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“My biggest sense is that we’re going to try to run it through the state,” said Kinney, who met last week with state Agriculture Secretary Mike Naig to discuss the issue. “That’s what most of the legislators I’ve talked to are leaning toward.”

Acting quickly after the 2014 farm bill, Minnesota launched its Industrial Hemp Pilot Program in 2015. Last year, 51 participants cultivated 710 acres of hemp. Costs averaged about $500 an acre, according to the Minnesota Department of Agriculture.

“It’s not a low-input crop if you’re looking at a return on investment,” Rieck-Hinz said. “Managing for weed control or from an insect or pathogen standpoint, it remains to be seen.”

The new farm bill allows states to bypass pilot programs and move directly to commercial production. With quick action, Disbro thinks Iowa farmers could plant hemp yet this year.

“The hope is we can get our legislation passed and the rules finished this year so the USDA can approve those rules,” he said. “We could move quickly enough, if the government is open, for a few farmers to get familiar with the crop this year.”

Kinney, who’s visited hemp producers and processors in Canada, said transporting raw hemp is expensive, so processing plants are best located near hemp sources.

“It would be more cost-effective to bring the processing jobs to where the plant is grown,” he said. “It would be an economic engine for a lot of small towns.”

Still, the market for industrial hemp is in its earliest stages. Last year’s Minnesota hemp growers reported no profits “since no one had received any money for their harvest,” according to the state’s ag department. “It is unknown what, if any, price the hemp fiber can fetch in the current market.”

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“If you’re going to grow hemp for fiber or seed or CBD, I would strongly recommend you have a signed contract in hand,” Rieck-Hinz said. “We have very well-established corn and soybean markets. We have a very well-established infrastructure. We don’t have that (for hemp) right now in Iowa or in the United States for that matter.”

Once Iowa’s program is underway, Disbro expects his group to link farmers, processors and end users to develop a hemp market.

“It’s an early stage of innovation,” he said. “People are looking to get involved with Iowa farmers.”

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