“One of the biggest problems is the lack of investment in this industry. So we have to de-risk it.”
By Anthony Hennen, The Center Square
A circle of farmers in Pennsylvania have embraced hemp as state and federal money encourages growth of the industry.
With government support, farmers troubleshoot how hemp plays a role in the production of textiles, paper, automotive bio-composites and construction projects.
The need, advocates argue, lies in more research funding and building new markets in the commonwealth to support the crop.
“We really don’t know what varieties will grow best in Pennsylvania,” Geoff Whaling, chairman of the National Hemp Association, said. “We’re still going to be researching all of this and we need to attract capital, public money.”
Whaling was one of dozens who gathered Thursday at Coexist Build, an organic farm and architecture firm in Blandon, Berks County, to discuss hemp in Pennsylvania.
Co-hosted by the U.S. Department of Agriculture’s (USDA) Rural Development program, the event brought together the Pennsylvania Department of Agriculture, Department of Health, Penn State University, Thomas Jefferson University and several state officials and private businesses to figure out how to grow a bio-based economy—from farming to manufacturing and technology.
The bureaucratic problems have been a long-term problem for hemp. Farmers must submit fingerprints and crops are subject to inspection, among other requirements. Those hoops can make people skittish to embrace the crop, which is often synonymous with marijuana. Hemp, however, contains THC in such low amounts that it does not make a user feel “high” and serves other purposes.
Yet, investors have also been cautious.
“The biggest challenge for this industry is raising money because capital markets are still very nervous about the word ‘hemp,’” Whaling said.
There’s hope that federal legislation will pass to remove those barriers, but in the commonwealth, hemp has already found some state support.
In January, Agriculture Secretary Russell Redding announced $200,000 in grants for hemp production and awarded $400,000 for grants to market and promote hemp in June. In May, a Luzerne County hemp company received a $1 million federal grant to find new uses for the product.
That comes on top of other grants, such as the $150,000 paid out in 2021.
“Secretary Redding has been a strong champion [for hemp],” Erica Stark, chair of the Pennsylvania Hemp Council, said.
The 2018 federal Farm Bill removed hemp from the controlled substances list, making it easier to grow hemp for industrial use. Farmers must get a license from the Pennsylvania Department of Agriculture, which has issued more than 200 growing permits and more than 50 processing permits statewide.
The hemp industry in Pennsylvania still has a way to go, however. It’s an open question as to how companies could use hemp in their products, where to process the raw materials, and what a supply chain in the commonwealth would look like.
Penn State and Thomas Jefferson Universities have a number of hemp-related research projects, which could help farmers figure out what varieties to grow and manufacturers how they can use hemp materials.
“One of the biggest problems,” Stark said, “is the lack of investment in this industry. So we have to de-risk it.”
Educating the public on the viability of hemp, Bob Morgan of the USDA’s Rural Development program argued, will take time. Hemp, too, has some “major steps” in its development before it makes a major contribution for construction and other industries.
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A National Hemp Report from the USDA estimated the value of industrial hemp at $238 million in 2022, a significant drop from 2021’s $824 million valuation. Pennsylvania, similarly, dropped from 4,000 acres of hemp in 2019 to 350 in 2021, reflecting a boom in interest when hemp production restarted in the commonwealth in 2017.
The interest in hemp, and state and federal support, is part of a broader push for sustainability and bio-based products. The USDA certifies dozens of products in Pennsylvania as “biopreferred,” which can get priority status for mandatory federal purchases.
“There’s a lot of efforts—not only at the USDA, but across the federal government—to promote sustainability,” Andrew Jermolowicz of USDA Rural Development said. “[We’re] trying to create some of these new industries, new economies.”
In the future, Jermolowicz expects “more of a commitment from the federal government to purchase sustainably,” which would benefit biopreferred products and bio-based producers.
Photo courtesy of Brendan Cleak.
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