Industrial Hemp Production

Adam Ornawka, BSA

Presented at the Iowa Farm Bureau’s Economic Summit 2019

June 28, 2019

About me

Grew up on a mixed farm in NW Saskatchewan

Bachelor of Science in Agriculture from University of Saskatchewan

Worked in ag retail

Precision farming and soil fertility consulting

5,000ac of canola, wheat, barley, pulses, and oats

600ac of organic hemp, lentils, wheat and oats

What we’ll cover

The hemp plant and it’s agricultural history

Uses of the hemp plant

Hemp agronomy

Harvest, storage and residue management

Yields and returns

Production and market trends

Developing a hemp market

Getting into hemp

What is Hemp

Cannabis sativa

Less than 0.3% tetrahydrocannabinol (THC)

Monoecious and or dioecious

4 to 15 ft. tall

Strong taproot

Day length sensitive flower set

Oilseed

Fiber

Hemp Adaptation

Prefer semi-humid conditions

Well drained soils

Neutral pH

Thrives between 60-80F

Frost tolerant (25F)

Intolerant to wet and saline soils

12-15” of water requirement

Late season drought tolerance

Hemp History

Origins in central Asia

Used widely across Europe and Asia since Neolithic times

First cultivated as far back as 8000BC

Used for clothes, rope, shoes, and early paper in China

Referenced in early Jewish records from the 2nd century

Used as food ingredients in medieval Europe

Later cultivation focused on fiber

Brought to the Americas by the Spanish in the 16th century with great success in Chile

Later Native Americans and Puritans are recorded cultivating hemp in the mid 17th century

Hemp in Modern Times

Widely produced in the US until the Marihuana Tax Act of 1937 is introduced by FDR

Lifted during WWII to supply fiber for the military to manufacture uniforms, canvas, and rope – 36,000ac

For the rest of the 20th century hemp production occurs almost exclusively in Europe and Asia – Primarily Russia and later China

1971: the UK begins decriminalization

1998: Australia and Canada start issuing production permits

1999: North Dakota, Minnesota, and Hawaii legalize the growing of industrial hemp at state level, but federally, industrial hemp is still illegal to grow in the U.S.

2018: President Trump signs The Hemp Farming Act of 2018 into law

Modern Hemp Uses

DON’T GROW HEMP!!!

Seeding

28-30 pounds per acre

9-12 plants per square foot

Seed shallow – ½ to 1 inch

Warm soil-above 50F

Ensure adequate packing but avoid crusting

Use low air speeds to avoid cracking and residue build-up

Spacing should be further apart to promote branching for grain production

Tighter spacing will encourage taller plants and less branching for better fiber quality

Early seeding will produce more plant growth

Late May to early June

Fertility

Fertilizer rates are between high yielding wheat and corn

Nitrogen application rates~120lb/ac

Trials show benefit up to 200lb/ac – more important for grain yield

Phosphate applications between 25-30lb/ac

Higher rates will be required under higher production systems

Potassium levels should be monitored to ensure adequate supply

250ppm or higher

Sulfur deficiency could limit grain yield and oil content

Weed Management

Pre-emergence burn off with glyphosate Rapid plant growth results high competitiveness, 12” of growth in the first month Limited registered herbicides in Canada

Edge- Ethalfluralin, AssureII- Quizalofop

Virginia Tech herbicide tolerance studies Herbicides flumioxazin, clorimuron, pendimethalin, metribuzin, and linuron appear to be

suitable pre-emergent herbicides for industrial hemp grain or dual-purpose production.

Herbicides clorimuron, pendimethalin, bromoxynil, quizalofop, sethoxydim, and halosulfuron appear to be suitable post-emergent herbicides for industrial hemp grain or dual-purpose production.1

Verify with processor before using any pesticide

1Herbicide Tolerance Studies of Industrial Hemp (Cannabis Sativa L.) in Virginia1 Jabari Byrd, Master’s Student; 2 Michael Flessner, Assistant Professor, 3 John Fike, Associate Professor Virginia Tech Industrial Hemp Research Program

Pests

Gophers love hemp

Cutworm

Bertha armyworm

Grasshoppers

Corn borer

Disease

Generally not a problem

Sclerotinia (white mold)

Botrytis (grey mold)

Others to watch

Root rots

Wilting

Mosaic virus

Nematodes

Abiotic Stress

Excess moisture reduces vigor and growth

Hail damage

Branching

Goose necking

Shelling

Drought

Short plants

Limited seed set

Lodging potential

Grain Harvest

Indeterminate growth

Shatter

Sprouting

Swathing (windrowing) is possible with shorter varieties

Straight cut – Draper Header

Contamination

Combine Tips

Monitor rotating shafts

Conventional>single rotor>twin rotor

Run cylinder or rotor as slow as possible

Sharp sickle

Chopper?

Harvest at 15-18% moisture

Avoid cracking

Reduces wrapping

Don’t choke the chaffer

1/8-7/16”- small grains

Fan 1000 RPM

Drying and Storage

Raw food, low processed product

Clean, clean, clean

Mold and yeast

Oil seed

Low heat drying – plenum temp<120F

Under 9% for long term storage

Aeration

Monitor

Turn the grain

Handling

Avoid damage

Large slow augers

Conveyors

Sanitation

Avoid bacterial and fungal contamination

Similar sized foreign seed

Gluten crops

Residue Management

Start with a shorter variety

Act quick – hemp residue becomes more difficult as it dries

High speed disc > tandem disc

Bale

Bunch and burn

Tall stubble may need to be rolled before burning

Straw chopper?

Grain Yield and Returns

Grain yield 400-1800 lb/ac

600-1200 lb/ac is typical

Prices are volatile

50-65 cents per pound

Organic is normally double

Gross return expected to be $400-600/ac

Fiber Production

Taller varieties

Higher plant densities reduce branching then hurd

Reduced fertility rates

Know your market

Hurd- building materials, mulch, paper

Bast fibers- Textiles and industrial products

Longer stalks are generally preferred

60 days from planting

Double crop potential?

Sickle is ideal

Retting – at least 30 days

Fiber Yield and Returns

2000 – 10,000lb/ac

6-11 cents per pound

About $300/ac gross return

Transportation cost

Lack of universal quality standards

Contamination

Non-hemp plants

Plastics

Stones

CBD

Still a regulatory nightmare in most, if not all, jurisdictions

Market size vs. hype?

Extracted from female flowers

Unpollinated CBD content is about 15%

Pollinated flowers drop to 1.5%

Potential to extract from harvest residue High volume, low yield

500lb/ac

$100/lb???

Proceed with caution

Global Production

U.S. Market Stats

Canadian Hemp Trade AllianceFour Pillars of a $1B Hemp Industry

Food

Well developed in some countries

Still developing – need for standards

Food ingredient opportunities

Feed

Regulatory barriers

Research and market development

Fiber

Growing interest

Critical mass

Fractions

Plenty of interest

Tightly regulated

Opportunities

Cannabis buzz

Demand for hemp derived products

Investor interest

Political interest

Environmental awareness

Pesticide use

Climate chaos

Plastic litter

Meat free protein

Buzzword premium

GMO free, gluten free, organic, ect

Challenges

Relatively small industry

Investment

Standards

Processing capacity

Global competition

Increasing interest in seed production in the E.U. and Asia

Trade agreements

Consumer awareness

Exposure to food products

Cannabis confusion

Government regulation

Building an industry

Whole plant use

Grain first

Easiest to produce, transport, process, and sell

High value

Fiber

Multiple uses

Established markets

Standards

Feed

Purge valve for excess production

Off grade product

Extracts

Technical challenges

Markets stability

Regulation

Getting Started

Start slow

Match production to demand

Grain First

Production contract

Start small

Be prepared for failure

Specialized equipment

Diversify income streams

Comments on Regulation

Maintain distance from marijuana

Separate streams

Multi year license for growers

Minimize producer paper work

Lower bureaucratic cost

Act quickly on animal feeds

National quality standards

Domestic

International

Questions?

Resources

Canadian Hemp Trade Alliance www.hemptrade.ca

European Industrial Hemp Association http://eiha.org/

Government of Saskatchewan https://www.saskatchewan.ca/business/agriculture-natural-resources-and-industry/agribusiness-farmers-and-ranchers/crops-and-irrigation/field-crops/specialty-crops/hemp

Cornell CALS https://hemp.cals.cornell.edu/2017/06/01/new-publication-industrial-hemp-from-seed-to-market/

Perdue University Hemp Project https://purduehemp.org/

Congressional Research Service https://fas.org/sgp/crs/misc/RL32725.pdf

Manitoba Harvest https://manitobaharvest.com/