Farmers rushed into hemp, but now face a glut(wsj.com)
wsj.com
Farmers rushed into hemp, but now face a glut
https://www.wsj.com/articles/farmers-rushed-into-hemp-now-they-face-a-glut-11575118801?mod=rsswn
67 comments
> In more strict states it's 0.3%.
Just to clarify: <=0.3% is the federal cut-off. it’s protected by the agricultural whatever act of 2018 - the plant itself is legal to cultivate, and its CBD oil derivatives are likewise loosely regulated. Above that it’s considered to be illegal cannabis, and -its- CBD oil derivatives are regulated accordingly.
Just to clarify: <=0.3% is the federal cut-off. it’s protected by the agricultural whatever act of 2018 - the plant itself is legal to cultivate, and its CBD oil derivatives are likewise loosely regulated. Above that it’s considered to be illegal cannabis, and -its- CBD oil derivatives are regulated accordingly.
just to clarify: 2018 United States farm bill
https://en.wikipedia.org/wiki/2018_United_States_farm_bill
https://en.wikipedia.org/wiki/2018_United_States_farm_bill
Missed a big one, which is the weather. Oregon had a week of early rain followed by a period of warm, sunny weather. These perfect mold conditions caused it to run rampant and hurt a lot of farms.
Source: My company grows hemp in Oregon
I figured everyone growing in the PNW would be using hoop houses.
Also in Oregon though only tangentially connected to the industry. We’ll see how long the CBG premium lasts. If American farmers are good at anything, it’s oversupplying demand.
> If American farmers are good at anything, it’s oversupplying demand.
And then asking for handouts when they don't make their money back.
And then asking for handouts when they don't make their money back.
CBD being the main drive to get into hemp seems misguided. People have been pushing the advantages of hemp fibers in industrial use cases for a long time, but obviously it will take awhile for these products to build up steam since hemp was less common in the past.
You’ve been able to have shipping containers of the stuff delivered from China and other places to your loading dock for decades.
They grow millions upon millions of tons of it each year and have an entire infrastructure of university and government research organizations built up around hemp cultivation.
The industrial products are never coming. Access by US domestic engineers and scientists to hemp on the order of days instead of weeks won’t change that.
There are billions of people on earth for which hemp cultivation has never been illegal, where they have grown it for centuries if not millennia.
To think that domestic production will spin up the release of industrial products can only lead to one of two conclusions:
1. There are no industrial uses of hemp to the degree that advocates claim. (The ludicrous ones) or,
2. Most of rest of the world, around 3 billion people, are all stupid and/or incompetent and only the smart and industrious US domestic engineers and scientists can figure out how to use hemp for things other than hippy bags.
I’ve been around the world. I’m going to go with 1.
I’m not saying hemp doesn’t have industrial uses.
I’m saying that the claims by some of its more fervent activists, on the order of “hemp fuel will power hemp steel-manufactured flying cars adorned in hemp faux “Rich Corinthian“ leather, that land of runways made of hempcrete and it’s all going to be carbon neural and organic because hemp violates the laws of thermodynamics and doesn’t require fertilizer or pesticide” are wrong.
They grow millions upon millions of tons of it each year and have an entire infrastructure of university and government research organizations built up around hemp cultivation.
The industrial products are never coming. Access by US domestic engineers and scientists to hemp on the order of days instead of weeks won’t change that.
There are billions of people on earth for which hemp cultivation has never been illegal, where they have grown it for centuries if not millennia.
To think that domestic production will spin up the release of industrial products can only lead to one of two conclusions:
1. There are no industrial uses of hemp to the degree that advocates claim. (The ludicrous ones) or,
2. Most of rest of the world, around 3 billion people, are all stupid and/or incompetent and only the smart and industrious US domestic engineers and scientists can figure out how to use hemp for things other than hippy bags.
I’ve been around the world. I’m going to go with 1.
I’m not saying hemp doesn’t have industrial uses.
I’m saying that the claims by some of its more fervent activists, on the order of “hemp fuel will power hemp steel-manufactured flying cars adorned in hemp faux “Rich Corinthian“ leather, that land of runways made of hempcrete and it’s all going to be carbon neural and organic because hemp violates the laws of thermodynamics and doesn’t require fertilizer or pesticide” are wrong.
Right. Somehow the hemp enthusiasts never seem to be interested in the other bast fibers - flax, jute, kenaf, manila, etc. Those all have major industrial uses. Hemp - just doesn't. Hemp rope went out towards the end of the sailing ship era, when manila, which doesn't rot from the inside out, was found.
The real action now seems to be in bagasse, the leftover strands after extracting sugar from sugar cane. It's a waste product from sugar mills, so it's really cheap, sometimes free. It's made into biodegradable containers for fast food, replacing styrofoam. Many of those little white clamshell boxes used for food delivery are now made from bagasse. It's also possible to make oriented strand board from bagasse, although that hasn't really caught on.
There's huge amounts of agricultural waste available very cheaply, if you have a use for it. Ethanol fuel from cellulose was a hot idea once, as a way to do something useful with corn cobs and stalks, but it's just not cost-effective.
The real action now seems to be in bagasse, the leftover strands after extracting sugar from sugar cane. It's a waste product from sugar mills, so it's really cheap, sometimes free. It's made into biodegradable containers for fast food, replacing styrofoam. Many of those little white clamshell boxes used for food delivery are now made from bagasse. It's also possible to make oriented strand board from bagasse, although that hasn't really caught on.
There's huge amounts of agricultural waste available very cheaply, if you have a use for it. Ethanol fuel from cellulose was a hot idea once, as a way to do something useful with corn cobs and stalks, but it's just not cost-effective.
I dunno, back in college I was reliably informed by a white kid in dreadlocks and a "Legalize It" t-shirt that hemp has lots of industrial uses.
It's a lot easier to grow hemp than build out the manufacturing infrastructure to produce products with it, so this glut should have been expected.
"There are no industrial uses of hemp to the degree that advocates claim."
That's a leap too far, especially considering the current chaotic state of the laws governing its use. There are surely advocates that also make leaps too far but the truth about the potential resides in the known uses, which are many, and those yet to come, which are also likely to be many.
Since China has a head start working on this we can assume it's likely they will be leaders in both hemp production and manufacturing hemp based products, and we can only blame ourselves if they are. But that still doesn't mean that the U.S won't invest in processing hemp grown here into useful and profitable products and when it does the cost and profits of production will stabilize.
"There are no industrial uses of hemp to the degree that advocates claim."
That's a leap too far, especially considering the current chaotic state of the laws governing its use. There are surely advocates that also make leaps too far but the truth about the potential resides in the known uses, which are many, and those yet to come, which are also likely to be many.
Since China has a head start working on this we can assume it's likely they will be leaders in both hemp production and manufacturing hemp based products, and we can only blame ourselves if they are. But that still doesn't mean that the U.S won't invest in processing hemp grown here into useful and profitable products and when it does the cost and profits of production will stabilize.
> That's a leap too far, especially considering the current chaotic state of the laws governing its use.
As the parent poster said, in most of the rest of the world, there are no such laws governing its use, and for some reason, nobody in it really has much of a need for this 'miracle' plant.
How do you explain that?
As the parent poster said, in most of the rest of the world, there are no such laws governing its use, and for some reason, nobody in it really has much of a need for this 'miracle' plant.
How do you explain that?
Before I commented I did a google search on hemp laws in China and they have very strict laws on it there. And we have strict laws on what can be imported here, so I'm not really sure what the parent poster is talking about. Basically we can import stalks and seeds that can't germinate here.
I don't know what those sell for but it's probably pretty hard to beat the price of what could be grown here legally.
Levi corporation announced just this year a line of the jeans and other clothes to be made with hemp. I think they're being made offshore but the point that it will take time for industries to ramp up for using hemp is made by that single case alone.
The market for it will surely grow from this point and likely peak and stabilize pretty quickly and, no, it won't be a "get rich bonanza" for farmers because it will grow almost anywhere here but it will be another crop they can grow and sell and that's good thing.
I don't know what those sell for but it's probably pretty hard to beat the price of what could be grown here legally.
Levi corporation announced just this year a line of the jeans and other clothes to be made with hemp. I think they're being made offshore but the point that it will take time for industries to ramp up for using hemp is made by that single case alone.
The market for it will surely grow from this point and likely peak and stabilize pretty quickly and, no, it won't be a "get rich bonanza" for farmers because it will grow almost anywhere here but it will be another crop they can grow and sell and that's good thing.
You left out the option that the industrial hemp products are more expensive (at this point) so only niche producers use it. I think hemp will see some industrial usage when it becomes cost effective.
How much is industrial hemp used in countries where it has always been legal though?
But what countries are that?
As far as I know, most followed US hegemony, and for example in germany it was legal, but very hard to get permission to grow hemp. So only small uses like for making rope and birdfood.
So I also believe demand and supply for various things will grow. I really like for example, that nowdays you can get organic hemp seeds in the supermarket. It gets more in fashion, because it is nice and quite healthy. But no, hemp will probably not disrupt big industries. It might disrupt the alcohol industrie a bit though, when it is widespread legal.
As far as I know, most followed US hegemony, and for example in germany it was legal, but very hard to get permission to grow hemp. So only small uses like for making rope and birdfood.
So I also believe demand and supply for various things will grow. I really like for example, that nowdays you can get organic hemp seeds in the supermarket. It gets more in fashion, because it is nice and quite healthy. But no, hemp will probably not disrupt big industries. It might disrupt the alcohol industrie a bit though, when it is widespread legal.
The Soviet Union grew it quite extensively, and I believe both Canada, France, and Australia have allowed its growing for a couple decades now. It doesn't seem like in any of those countries it has lived up to the potential pro-hemp boosters claim.
I dunno, GP is raising some solid points. Why hasn’t this happened in places where the government didn’t clamp down on it?
Also, isn't hemp-derived CBD more or less inert? My understanding is that there's some evidence for positive psychological effects from cannabis-derived CBD but not for hemp-derived.
CBD is a single molecule (see https://en.wikipedia.org/wiki/Cannabidiol ). it doesn't matter where you get that molecule from, or if you synthesize it from raw chemical feedstocks.
CBD effectiveness for migraines (the only use I'm familiar with) is greatly decreased if taken outside of the presence of any THC.
Honestly the science on this isn't in because the funding has never been available.
Honestly the science on this isn't in because the funding has never been available.
i'm entirely open to believing that! there are a huge number of cannabidiol compounds in the plants, and teasing them apart is a very recent endeavor.
(it's also totally orthogonal to my claim.)
(it's also totally orthogonal to my claim.)
CBD is CBD no matter it's source but it is possible to isomerize under certain vaporization conditions into Δ8-THC which will get you buzzed at least.
Hemp and cannabis are the same thing. So much so that if your crop turns out “hot”, then you’ve accidentally just grown marijuana.
Got any links on that? I've read that hemp crops has been known to remove THC from cannabis, course I need to figure out where I read that from too.
Sure: https://phys.org/news/2019-02-hemp-marijuana.html
There are some questions around whether the “entourage effect” is beneficial with CBD. In other words, does the presence of THC and various other compounds make CBD oil more effective for x or y (vs pure isolates of just CBD).
But “industrial hemp” really just means cannabis with a THC content below a federally determined guideline. And that’s why it needs to be tested for being “hot”. Many people lose their crops because they test hot and find themselves with smokable weed.
There are some questions around whether the “entourage effect” is beneficial with CBD. In other words, does the presence of THC and various other compounds make CBD oil more effective for x or y (vs pure isolates of just CBD).
But “industrial hemp” really just means cannabis with a THC content below a federally determined guideline. And that’s why it needs to be tested for being “hot”. Many people lose their crops because they test hot and find themselves with smokable weed.
Interesting, I hadn't heard of this before.
I've heard they grow the same strains but harvest very early. Additionally, there are strains that have been bred to only have CBD. So both are correct.
But industrial hemp is a very different plant and farming it is a very different process. You can't easily switch from one to the other.
I wish paywall/registration bypasses could be the original link by the OP, or at the very least, pinned at the top of the comments.
I don't understand why HN finds piracy acceptable for news content. If the post was about a video game or movie release, should we pin a link to the .torrent file?
The difference being that you don't need to play the entire game or watch the entire movie in order to take part in the discussion about that game's/movie's release. However, you do need to read the entire article before being able to take part in the discussion about that article.
So I think it's fair that OPs should either make sure that the articles the post are accessible to all (and hence the discussion about those articles (which is the entire point of hacker news) is also accessible), or just don't post paywalled articles
...or alternatively post a paywall bypass. Maybe it's not right, but it's a solution.
Me too, but I also understand publishers who need subscribers so they could survive in this profit-based economy.
Oh! Is this what the entire "Tegridy Farms" spin-off season of South Park all about?...
I think that was more about the rush to jump on the legal cannabis (high-THC for medical/recreational as well as low-THC for CBD and fiber, oil, etc.)
No Colorado legalized weed a while ago.
Goldmine market mentality (aka investment fad of the year) gets popular and the market is oversupplied, the market corrects.
Business 101
Business 101
Hemp seeds have failed to catch on as food for a simple reason: they're too strongly flavored. The nutrition claims are largely true, and the flavor isn't terrible, but in order for hempseed to provide, say, 15 grams of protein to a meal, you need to eat about a quarter of a cup of hempseeds. Imagine eating a quarter of a cup of sesame seeds. See the problem? I think the missing link here is some kind of fermentation process that produces something more palatable.
As for the fiber, it's a relatively unremarkable cellulosic fiber. It is rather coarse and contains about 8% lignin, which means hemp fabric is relatively stiff and rough, limiting its application to clothing beyond its branding power (and shoes, where it works well). However, it is useful in composites. Hemp is apparently being used to make composite panels for several cars in the present day, although the actual volume in this market is not so high. The asterisk is that there are lots of other similar fibers (jute, linen, lyocell) that work well in composites, and it's the resins (polyester) which tend to be both more expensive and environmentally problematic. If some kind of more eco-friendly resin technology appears (don't hold your breath) it could become more widespread.
Other claims, e.g. hemp as a building material, are just wrong (hempcrete is not structural). Hemp rope was replaced by manila which has better moisture resistance. Hemp as a biodiesel precursor is unremarkable.
As for the fiber, it's a relatively unremarkable cellulosic fiber. It is rather coarse and contains about 8% lignin, which means hemp fabric is relatively stiff and rough, limiting its application to clothing beyond its branding power (and shoes, where it works well). However, it is useful in composites. Hemp is apparently being used to make composite panels for several cars in the present day, although the actual volume in this market is not so high. The asterisk is that there are lots of other similar fibers (jute, linen, lyocell) that work well in composites, and it's the resins (polyester) which tend to be both more expensive and environmentally problematic. If some kind of more eco-friendly resin technology appears (don't hold your breath) it could become more widespread.
Other claims, e.g. hemp as a building material, are just wrong (hempcrete is not structural). Hemp rope was replaced by manila which has better moisture resistance. Hemp as a biodiesel precursor is unremarkable.
Trader Joe's has a vanilla hemp protein powder I like (milk-based ones mess with my stomach). I couldn't imagine eating the seeds directly, but they go down very easy in a smoothie.
I'm not familiar with any fermentation process that operates on nuts, or any high-fat food source besides soybeans.
I'm not familiar with any fermentation process that operates on nuts, or any high-fat food source besides soybeans.
There is apparently a semi-standardized process where a hydrated nut butter is fermented with yogurt bacteria for a few days:
http://www.bccdc.ca/resource-gallery/Documents/Educational%2...
I'm not sure if this process has been attempted with hempseeds. It's a fast bacterial process, in contrast with the slow fungal fermentation of dairy cheeses. I wouldn't really say it's a commercial-ready process at this point; I'd like to see something done with proper cheese cultures!
http://www.bccdc.ca/resource-gallery/Documents/Educational%2...
I'm not sure if this process has been attempted with hempseeds. It's a fast bacterial process, in contrast with the slow fungal fermentation of dairy cheeses. I wouldn't really say it's a commercial-ready process at this point; I'd like to see something done with proper cheese cultures!
The WSJ article makes me feel better about strongly urging a family member against an investment in a hemp farm in 2018. They used an unrealistic value for the price of CBD in their projections and didn't account for a decrease in the price over the next few years.
But besides that, it was one of the worst business plans I'd ever seen. I couldn't tell if they were just inept, or were scam artists looking for gullible investors.
But besides that, it was one of the worst business plans I'd ever seen. I couldn't tell if they were just inept, or were scam artists looking for gullible investors.
This reminds me of the ethanol rush in the early aughts by farmers who rushed to pull the crops they were growing to switch over to corn in hopes ethanol and E85 craze would take off.
A decade later and the debate still rages whether ethanol and E85 was even it worth it now with electric vehicles and hybrids are way more common and many stations who had E85 pumps are all but gone now.
A decade later and the debate still rages whether ethanol and E85 was even it worth it now with electric vehicles and hybrids are way more common and many stations who had E85 pumps are all but gone now.
As another comment noted, biomass is overproduced and prices low but premium smokeable hemp flower is still doing well. I imagine more farmers will shift in that direction next year, assuming the new USDA rules don't destroy the industry.
The new USDA guidelines would make almost all of the current strains of CBD-dominant flower unavailable to grow due to the change in testing to count total THC rather than just delta-9 THC. Some farmers will switch to CBG which is another cannabinoid, but it's not one that is going to have as wide of an appeal.
My small friends and family grows in Southern Oregon and we did ok this year despite the challenges, but there is a lot of uncertainty around what will happen next year due to the potential regulation changes.
The new USDA guidelines would make almost all of the current strains of CBD-dominant flower unavailable to grow due to the change in testing to count total THC rather than just delta-9 THC. Some farmers will switch to CBG which is another cannabinoid, but it's not one that is going to have as wide of an appeal.
My small friends and family grows in Southern Oregon and we did ok this year despite the challenges, but there is a lot of uncertainty around what will happen next year due to the potential regulation changes.
You know you are in a huge production bubble when all major cannabis producers use as their main metric their production capacity. Aurora cannabis even went as far as to lower their Average net selling price of wholesale bulk cannabis by 4% in the last quarter, due to not finding the demand to keep up with the production boom of the industry.
Reminds me of the scene in the "The Prize: The Epic Quest for Oil, Money, and Power" where oil was booming and production was hardly centralized which led to big fluctuations in the price and an overestimation of the demand, and therefore of the necessary supply.
Reminds me of the scene in the "The Prize: The Epic Quest for Oil, Money, and Power" where oil was booming and production was hardly centralized which led to big fluctuations in the price and an overestimation of the demand, and therefore of the necessary supply.
Shame, he didnt grow his crop with tegridy
What does this mean?
That's unfortunate, because industrial hemp (as opposed to cannabis hemp)is the most efficient way to capture carbon dioxide in the form of biomass. It should be grown for carbon credits alone, but this (cannabis) hemp bubble imploding will taint industrial hemp by association.
How does this work?
You grow a ton of hemp. It captures X tons of carbon.
People use it for rope or whatever. Eventually throw it away. It decays or is burned. X tons of carb are released back into the atmosphere.
How did that capture any carbon?
You grow a ton of hemp. It captures X tons of carbon.
People use it for rope or whatever. Eventually throw it away. It decays or is burned. X tons of carb are released back into the atmosphere.
How did that capture any carbon?
It's about the long term. For hemp, in this case, Let's say 10 tons are captured per year, 1 ton is burned immediately as biomass. 9 tons is converted into goods which have an average duration of 10 years before being discarded, let's assume that they're burned immediately after 10 years, then you can get a net effect of removing 90 tons after the 10 year mark (hitting a steady state because 9 tons extra are being burned every year from that point on). If you can keep that 9 tons out of the atmosphere for 100 years, you remove 900 tons from the atmosphere after a century.
If those goods are discarded in a manner where the carbon isn't immediately re-released, so they're buried or introduced into a bio-system that can consume it and turn the carbon into some other non-gas form, then you can get further gains.
If those goods are discarded in a manner where the carbon isn't immediately re-released, so they're buried or introduced into a bio-system that can consume it and turn the carbon into some other non-gas form, then you can get further gains.
Lets say you burn it to generate power, as a lot of refuse is in Sweden. That's substituting for fossil fuels. Is it better to burn oil out of the ground, or carbon extracted from the atmosphere? You're creating a more sustainable cycle.
As a material, if you're using it in place of plastics again it forms a more sustainable cycle over a reasonably long time frame.
Yes we do need to sequester some atmospheric carbon long term, but establishing a more sustainable carbon materials cycle has an important role to play.
As a material, if you're using it in place of plastics again it forms a more sustainable cycle over a reasonably long time frame.
Yes we do need to sequester some atmospheric carbon long term, but establishing a more sustainable carbon materials cycle has an important role to play.
Sequestration remains an open problem. There are no large scale biomass capture projects in operation. But the science isn't hard: you bury it, basically. Or if you want to be fancy you burn it for biomass energy and capture the resulting CO2 for fancier sequestration techniques. Both are expensive, and no one is willing to foot the bill.
Right now the only realistic way to use photosynthesis to capture CO2 in a long term way is to plant a forest. There's some amount of this going on, though not enough to even cover deforestation elsewhere.
Right now the only realistic way to use photosynthesis to capture CO2 in a long term way is to plant a forest. There's some amount of this going on, though not enough to even cover deforestation elsewhere.
We need to start throwing our old newspapers down coal mines (or bury it) rather than recycling it - that will encourage more trees to be grown and solid paper is a great way to sequester carbon
If you want to be really fancy, you only partially burn it to make biochar, soak that in urea, and use that to make terra preta.
Two ways:
- the products last longer than a rotting plant. This is incremental.
- burned for energy. This reduces coal, NG etc uses and is roughly carbon neutral
- the products last longer than a rotting plant. This is incremental.
- burned for energy. This reduces coal, NG etc uses and is roughly carbon neutral
after you're done using your hemp hacky sack you bury it miles under the earth's surface and it slowly begins to turn into coal
You can turn it into biochar. The biochar contains a large part of the plant's carbon and is stable for a few millenia at least. The process is even exothermic. It is also good for the soil if you till it under.
"because industrial hemp (as opposed to cannabis hemp)"
Are they really growing that much more efficient? Cannabis hemp was also intensively optimised for grow since generations.
Are they really growing that much more efficient? Cannabis hemp was also intensively optimised for grow since generations.
Has there been much usage for the fiber? (Paper, rope, textiles, etc.)
Guess we're going to have to start exporting it :-)
1) they weren't growing on contract and didn't have buyers lined up 2) didn't grow for smokable flower 3) had their plants herm due to bad seed stock or environmental stress 4) their hemp ran 'hot' with THC over the allowable levels and they live in a state where the AG commissioner cares. Was up in Oregon and the farmers were telling me as long as it's under 2.0% THC they get a pass. In more strict states it's 0.3%.
Source: am a shareholder in a large CBD cultivation/manufacturing business.