Trade War Leads to Increase in Hemp Farming

Every story this year has highlighted how difficult it is for farmers. Crop growth has been affected by a much wetter than average spring and summer in the Midwest. Worse is the ongoing trade war between the United States and China, which has shut down one of America’s largest soybean export markets.

A federal law change made late last year has provided some farmers with a new source of income: hemp. Once caught up in our country’s seemingly never-ending reefer madness, it is now legal to grow hemp across the U.S.

A growing industry

According to Vote Hemp, an industry advocacy group, there are 13 new states where hemp is growing for the first time in 2019, on top of the 21 states where it was growing in 2018.

In the United States, there are 16,877 licenses for growers who have 511,442 acres. According to one market research firm, 87 percent of hemp harvested this year will be used for CBD products, which are exploding in popularity. According to The New York Times, one first-time Illinois hemp farmer stated that hemp could help him stabilize his finances after a difficult year with his soybeans and corn. Another told the Chicago Tribune that he was hopeful he could make $100,000 an acre on his hemp crop.

The Risks

There are many risks associated with hemp farming, just like any other crop. Many first-time farmers of hemp may find that their soil doesn’t work well with the plant.

There are no approved pesticides that can be used to grow hemp. Deer and insects could pick a crop apart, so this is a risk. Also, crops must be tended to manually which can increase labor costs.

Legalization could be the greatest risk. The CBD-rich hemp plants used for CBD products can produce too high levels of THC. This chemical is what gets you high when you smoke pot. The law requires that farmers remove the plants when this happens.

And as we’ve already seen, law enforcement has a hard time telling the difference between hemp and marijuana. The police officer may not be able to read your paperwork if you think you are transporting pot.

It is crucial to have the right legal representation as you think about your options. To ensure compliance, your lawyer should keep abreast of all developments in the industry, both in your state and nationally.

Similar Resources:

For more Small Business tips, news and advice, follow us on Twitter
Cyndy Lane