2019 was a challenging year for hemp farmers in North America.
Based on the recent press, you’d think that growing hemp is easy. Since the passage of the 2018 Farm Bill legalizing hemp cultivation nationwide, the hype is everywhere. Many farmers of traditional crops like corn and soybeans are either switching to hemp or adding it to their crop rotations in droves. While many that have joined the rush to hemp have been focused on fiber or CBD-additive products, an expanding portion of new hemp farmers are taking on the “smokable flower” product category. This category primarily includes hemp pre-rolled joints, now technically 50-state legal
And who can blame them? Theoretical yield numbers of $50,000 or more per acre are hard to ignore when an average acre of corn goes for $1000.
At the close of the 2019 harvest season, the hype didn’t live up to reality. Many farmers bet their struggling farms on the success of a hemp harvest and lost everything. For some, it may have been too much, with anecdotal stories of hemp farmers having committed suicide circulating within the community with alarming frequency.
So, what happened?
They Didn't Know What They Were Getting Into
Hemp is a complicated crop to grow and harvest with few similarities to traditional agriculture. Cannabis cultivators have long known how unique a plant it is and how specialized the knowledge-base needs to be for a cost-effective crop. After all, hemp is essentially cannabis with less than 0.3% THC.
Many traditional farmers and others with no ag experience rushed into the hemp game without understanding how difficult it is to grow and harvest. Cultivation is labor-intensive. The more than 80 year gap since hemp harvesting was done on a large scale presents a steep learning curve. Hemp farmers today are essentially starting from scratch, and learning as they go. This lack of plant-specific growing knowledge resulted in much smaller crops than many farmers anticipated.
From hail damage to higher than average rainfall, the weather didn’t cooperate this season further reducing total crop sizes and plant viability.
No Crop Insurance
Normally, farmers ride out problematic years with crop insurance. This wasn’t an option as federal crop insurance wasn’t offered to hemp farmers. While some states offered limited relief, hemp farmers had to either cross their fingers or opt for costly private insurance. Things might change in 2020 with the Whole-Farm Revenue Protection program, but the majority of hemp farmers will still be left out.
A Lack of Banking
Even though hemp cultivation is federally legal, banking for hemp farmers remains complicated, and working capital is difficult to access. Banking and financial institutions are still unsure of how to handle things without federal guidance, and most are taking a wait-and-see approach.
A Lack of Automation
There is little to no large-scale automation for hemp-harvesting intended for smokable flower products. Remote-controlled combines and irrigation equipment used for hemp fibre or other crops don’t translate to the complexities of this type of hemp harvesting.
Oversupply of CBD Products
Despite the hype around CBD, hemp farmers actually produced more than what was needed to fuel the industry. Many farmers grew their crops on spec assuming it would be easy to unload when they had finished their harvest. That wasn’t the case. Those that didn’t have contracts in place ahead of time were left with the choice of selling at substantially reduced prices, or worse, holding their product and potentially making nothing in the short terrm.
What Can We Do To Help The North American Hemp Industry?
Mobius offers the world’s best cannabis processing equipment which is also appropriate for hemp. The Mobius Trimmer M108s is often used for trimming hemp for smokable flower products. Our Cannbucker MBX is suitable for bucking hemp flower and leaves from stems before extraction or trimming. The adoption of proven equipment can dramatically reduce the cost of processing hemp, easing the profitability burden for growers. Our purchase financing programs also can help spread the cost of equipment over multiple harvests.
In some ways, we see the obstacles faced by hemp farmers today as similar to that of North American manufacturers. The commonality of the challenges we collectively experience links us together. As such, we are committed to helping hemp farmers in America, Canada, and around the globe find a path to long-term success.
If you’re a hemp farmer growing smokable flower products and are interested in our equipment line-up, we’d love to chat.
If you’re a hemp farmer that has harvesting needs NOT solvable by our current line of equipment, we REALLY want to chat. Let’s work together to better understand where we should focus our research and development efforts -we’d love your input.