News

Check out market updates

Acreage down, but Colorado not done with hemp

Agricultural production may be way down from its 2019 heyday, but Colorado isn’t done with hemp.

“Obviously we were a state that was a very early adopter, and our producers jumped in headfirst,” said Dawn Thilmany, a professor of Ag and Resource Economics at Colorado State University and co-director of the CSU Regional Economic Development Institute.

“We had a product that was prohibited for that long, so the supply chain went away,” said Thilmany about the 1937 law that made both hemp and marijuana illegal. But Thilmany noted that the door is still open for hemp products other than CBD oil, such as fiber, textiles and even human and animal food.

Colorado took early action on hemp, opening the crop for production in 2014 and adopting the Colorado Hemp Advancement and Management Plan (CHAMP) initiative soon after. Hemp production in Colorado exploded a year after the 2018 U.S. Farm Bill opened the door to potential national markets. In retrospect, the CBD market was the lone reliable market in Colorado, as many other markets needed processing equipment and supply chain improvements.

“It’s a giant bell curve,” explained Brian Koontz, the hemp program manager for the Colorado Department of Agriculture. “The first year there were one or two thousand [acres], but after the 2018 farm bill people went crazy.” 

The CBD industry in Colorado was a strong market in early years, as hemp production grew from 1,811 acres in 2015 to 12,348 in 2017 and 20,080 in 2018. But with the farm bill production blew up to a high of 88,743 acres in 2019. The fall was equally fast, as production was cut by more than half to 36,225 acres in 2020, about 18,000 in 2021 and 3,482 acres this year.

“It’s still falling,” Koontz said, noting there appears to be hemp still on the market from the early heyday.

But Koontz, who had posts in the ag department prior to hemp, isn’t looking for re-assignment; he believes there will be plenty of work coming, noting there are new processors, and products, on the way.

That includes the recent entry of Global Fiber in Monte Vista, which produces raw materials for hemp processors in new markets, including fiber, textiles, animal food and bedding, and bioplastics. The company also has technology for processors to improve their own supply chains; its subsidiary, Formation Ag, works with farmers and manufacturers to develop cost-effective and cutting-edge technology for hemp farming.

Similarly, in Longmont hemp businesses include hemp seed processing and a business, Hemp Building Co., that uses hemp hurd, the interior of the stalk, to create products such as hempcrete — a lightweight version of concrete. For fiber and textile uses normally the exterior, or blast, of the hemp stalk is separated into long fine strands, creating the product traditionally used for rope and canvas.

Also in Longmont is Colorado Hemp Works, which processes hemp seed, or grain, to be used in food products. Its wholesale products include hemp hearts, seed oil, seed cake, flour, shell casings and protein/fiber powders, all made from hemp seed.

The hemp used for CBD oil needs to create buds, so all the productive plants have to be cross pollinated to create feminized plants. Creating plants that can serve several purposes may be key to agricultural success, said Thilmany, who is the lead CSU professor in the extension office.

The state Department of Agriculture is still responsible for testing THC levels in the hemp produced on Colorado farms. Previously, the Ag Department also had field tests of hemp strains, tests that are now being conducted by the CSU Extension service.

CSU is involved in hemp research in a variety of ways including genetics, seed production and, along with the University of Kentucky, is conducting a national census of hemp growers and processors, said Rebecca Hill, a research scientist at the CSU Department of  Agriculture and Resource Economics. Kate Greenberg, state ag commissioner, was also a speaker before the U.S. House Subcommittee on Biotechnology, Horticulture, and Research for “An Examination of the USDA Hemp Production Program.”

But with everything seeming to be heading in the right direction, Thilmany said farmers are still going to be wary for some time to come.

“There were some people who maybe didn’t advise them well” in 2019, she said. “All the risk advisers are now saying ‘you need a contract.’”

See related story – Will Greeley be the epicenter of Colorado industrial hemp?

Source: BizWest

Leave a Reply

Your email address will not be published.

X