Amid struggles, farmers eye potential in burgeoning hemp industry

Even as Pennsylvania’s hemp industry continues to face growing pains, farmer Rick Fundy knows there is potential in the trade.

This year, he invested $5,000 to begin growing hemp on his future son-in-law’s Latrobe farm. With equipment already purchased for use on other crops, Fundy invested in seeds and other items necessary to begin growing the plant. So far, 200 of the 2,100 seeds that were planted have sprouted, Fundy said.

“I know the potential is there for very good income, but we’re learning from our mistakes the first time and we know what to do better next season,” he said. “I’m sure we’ll break even, and then I think we’ll turn a profit from what I’ve invested — which wasn’t very much because the infrastructure was already (at the farm).”

Farmers have largely struggled since hemp was legalized through the federal 2018 Farm Bill. Last year, the more than 500 growers and 60 processors with state permits planted fewer than 1,000 acres of hemp — down about 75% since 2019. Officials last year noted that less than half of those crops were harvested, with most of the rest lost to weather and pests.

Still, Fundy was not deterred.

He is one of the 426 growers issued a permit this year, in addition to 64 processors. Data on acreage planted and harvested is being collected and will be released later, said Shannon Powers, spokeswoman for the state Department of Agriculture.

According to Erica McBride- ­Stark, executive director of the Pennsylvania Hemp Industry Council and the National Hemp Association, issues seen across the industry resulting in fewer acres being planted boil down to oversaturation of the cannaboid market and slow progress in opening fiber and grain markets.

“We’re in this kind of weird in-between phase where the cannaboid markets are trying to even themselves out and we’re working toward building the infrastructure to really get the fiber and grain portion of the industry up and running, which is where we’ll see the sustainable amount of large acreage being grown,” McBride-Stark said.

Industry issues

Sarah Jobes has seen firsthand the struggles of Pennsylvania’s hemp industry.

Jobes, whose family has a farm in Indiana County, said they first planted hemp in 2019 and invested thousands of dollars into growing the plant.

The following year, most of their plants were lost as little rain came to the region, she said.

“We didn’t make any profit at all,” she said. “We weren’t really able to sell products, and with the drought we lost a lot of the stuff the second year we did it. The first year was kind of our test to see if we could do it or not. A lot of work, especially when you’re a farmer and you’re trying to do it on top of farming.”

While the family did receive a permit to grow this year, they were unable to do so after Jobes’s father was injured in a wreck. She was not sure if he will grow hemp again next year.

“It was a lot of work,” Jobes said, noting that hemp’s harvest time coincided with their traditional harvest season. “It seemed like it was a lot of regulations that we had to follow.”

The U.S. Department of Agriculture has set several regulations for the hemp industry, including the amount of THC — the psychoactive compound in marijuana — that can be present in a hemp plant. If THC levels exceed 0.3%, farmers must destroy the crop.

In addition to regulations, farmers are traversing a heavily saturated market that saw an influx of farmers from several states after the Farm Bill passed. By 2019, a glut in supply caused the price of hemp biomass to peak at $40 a pound in July. It dropped to $10 a pound by January.

“We flooded the market,” McBride-Stark said.

She noted there has been a rise in new products since the bill passed, including the highly controversial Delta-8, which has not yet been approved by the FDA. The product has been a topic of discussion in several states, including Texas, which banned products with Delta-8. Others, including Louisiana, have decided to regulate the hemp-derived product.

Despite CBD markets receiving the initial influx of funding, the future of the hemp industry lies in fiber and grain production, McBride-Stark said.

That market will produce nutritional and industrial products such as bioplastics, car parts and replacements for wood products.

“All of the things that will make existing products better, stronger and more sustainable,” she said.

Future of hemp

The future of the fiber and grain markets has McBride-Stark optimistic that the hemp industry will see growth in coming years.

“We’re already starting to see investment in that infrastructure happening,” McBride-Stark said. “We’re still probably a good three to five years out from having it be really common and the amount of infrastructure that we need, but we will definitely get there.”

For the fiber and grain market to take off, farmers will need to add hemp plants into their rotation of other crops such as corn and soy, McBride-Stark said. If 5% of acreage is changed from corn and soy to hemp, the industry could grow by 8 million to 10 million acres, according to an economic impact study recently conducted by the National Hemp Association.

In addition, the report states that by 2030, industrial hemp could have a $32 billion total economic impact.

For Fundy, who decided to grow hemp after using CBD oil for several years, the medical, industrial and environmental benefits of the crop make the industry worthwhile. His main concern about growing hemp is ensuring THC levels remain under the 0.3% limit set by regulators.

“You’re not getting rich overnight, not in this,” Fundy said. “But if I see potential, I definitely will continue doing this. … It’s a win, win, win with this.”

Megan Tomasic is a Tribune-Review staff writer. You can contact Megan at 724-850-1203, mtomasic@triblive.com or via Twitter .


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