When it comes to hemp, Kansas farmers need to continually pivot
NICKERSON — Three years ago, the Hiatt family decided to start a new adventure by transforming a couple of acres of farmland into an industrial hemp field. Each year they learn, and each year they pivot. Sometimes a little; sometimes a lot. Across the nation, hemp farmers like the Hiatt’s are either changing what they are doing or leaving the industry.
The big bust
Last year, nationwide, the number of acres was down significantly from the year before,” said Sheldon Coleman, the CEO of Sunny land Kansas in McPherson. “The numbers are all over the map, and I’m going to use an average, roughly 110,000 acres were licensed in 2019 and went down to about 45,000 acres in 2020 (nationwide).”Coleman said that number has decreased to around 20,000 to 30,000 nationwide planted acres today.“ So (nationally), you’re down 80% in two years,” Coleman said. “You have a huge oversupply that in 2019 and the price crashes. Farmers can’t figure out how to sell their product.” Coleman said there are estimates that 50% of the crop in 2019 was not harvested and died in the field. Unless farmers had an outlet for their crops, there was not much of a market.
“People could make $25,000 an acre growing hemp and selling the biomass — just selling the plant material in 2017 and 2018,” he said. In Kansas, the number of growers shrunk from around 275 in 2020 to slightly more than 80 in 2021.
The Hiatt’s, who runs High Point Family Farms just outside of Nickerson, realized early on that not only was industrial hemp hard to grow but finding an outlet for their product was difficult as well. Last year, one of their fields had too much THC (Tetrahydrocannabinol) – the hallucinogenic in it, so that field was destroyed. Currently, in Kansas, if the sampling tests too high for THC, above .3%, the entire crop must be eliminated. THC is the primary compound in cannabis that is responsible for creating a high. Each field is regulated and government tested. Industrial hemp, used for CBD – non-intoxicating cannabinoids – rope, fabric, and grain, is a variety of the same species of plant as cannabis; but, this crop yields low levels of THC.
This year, a pack of armyworms decided to march across both the Hiatt’s field and one of their greenhouses, crippling some of their well-cared-for plants.
After a year, what the Hiatt’s realized, was there were not too many buyers of their raw product, so they decided to change their paradigm and become retailers as well, keeping the supply chain close to home. We planted a lot fewer plants this year,” said Sara Hiatt. “This year, we have about 2,100 plants. Last year, we had about 5,000.
The couple and their three grown children opened up a CBD store, High Point Pharms on Main Street in Hutchinson last spring. Along with their private label products, grown directly on their family farm, they sell their own honey, as well as other hemp-based goods. But, it is difficult for people selling industrial hemp products to obtain loans – so expansion will take time.
Someday, the family hopes to make the business more than a side job. But for now, they are working hard to make a go of their business, attending fairs and working the storefront. They are also trying different ways to keep their land and the plants environmentally friendly. By having friendly bugs like ladybugs, introducing sugars, and keeping living roots in the ground each day of the year, Bob Hiatt and his son Nate are changing the nutrition of the ground.
“I’m pretty disappointed in it (this year’s crop),” Bob Hiatt said. “But we’re still going to produce some pretty decent oil though.”
Similarly, the owners of Sunny land Kansas, a father and son team who started farming hemp in Oregon, understand the need for being a part of the supply chain. Along with growing their own industrial hemp, this company sells seeds, consults, dries, and packages the product.
California just changed its law for selling industrial hemp products
With the stroke of a pen, this past Wednesday, California changed the retail paradigm for selling industrial hemp products. California Gov. Gavin Newsom opened up retail markets for non-intoxicating cannabinoids. In the Golden State, CBD can now be sold as a dietary supplement and can be included in cosmetics, drinks, and pet foods. But in so doing, California will require strict testing and labeling guidelines. The state also, once they figure out a tax method, has set in play the use of commercial hemp products to be used for smoking. This opens up the market for hemp growers in Kansas and helps guide the way for Kansas legislators to look into new retail markets.
However, the FDA: U.S. Food and Drug Administration, states CBD products cannot be sold as dietary supplements under the FD&C Act and cannot be added to food for humans or animals.
In 2018, the FDA allowed “three hemp seed-derived food ingredients for use in human food: hulled hemp seed, hemp seed protein powder, and hemp seed oil,” per the FDA rulings on industrial hemp.
The next wave for hemp sales
According to Sheldon Coleman, 25 to 30,000 acres of hemp can supply most of the consumer demand for products in the U.S. This leads the way for companies to go outside U.S. borders. “The bigger companies are starting to see exports exceed domestic sales,” said Christian Coleman, president of Sunny land. Also, according to him, the minor cannabinoids, like CBG are coming on very strong. Some of these consumer packaged products are about to explode, he said. In addition, there is the grain side, which Christian Coleman said is being looked at for hemp seed protein and animal feed.
“We just now think we’re seeing where it’s starting to get re-stabilized (supply and demand),” Sheldon Coleman said. “There’s still product being dumped from 2019 and 2020. But we’re starting to see some scarcity develop again, and the people that have stuck with it, are starting to see a little more opportunity.”
Kansas is home to a new fiber plant and one of the area’s largest hemp dryers
Kansas is also the home to a new fiber plant, South Bend Industrial Hemp Processing in Great Bend. This plant is one of the few in the country that can process hemp fiber directly from the field. The Sunflower State is also the home to one of the area’s largest hemp dryers, at Sunny land’s processing plant in McPherson. In addition to good farming practices, Kansas weather presents a challenge. Market volatility for industrial hemp remains a significant factor in profitability.
“Kansas needs to do two things, one is step up with dietary supplements and (two) embrace smokeable (non-hallucinogenic hemp products),” Sheldon Coleman said. Neither the Hiatt’s nor the Colemans are giving up on their dream — helping others obtain good quality, Kansas-grown CBD.
“The most exciting thing to me is to find out our product works for our customers,” Sara Hiatt said. “We hear it all the time.”
Disclaimer: This article is originally published on https://www.hutchnews.com/story/news/2021/10/11/industrial-hemp-farmers-decrease-in-kansas-nationwide-cbd/6034570001/
