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Study Finds Small Market for Hemp

Posted on January 25, 2000

By Philip Brasher, Associated Press

Washington, DC — The government says there is little future in growing industrial hemp even if federal drug agencies were to relent and legalize its production.

Hemp, the non-halluciogenic cousin of marijuana, can be used for both clothing and food, but there would only be a “small, thin market” for the crop, according to a study by the Agriculture Department’s Economic Research Service.

All of the hemp fiber, yarn and fabric that the United States currently imports could be grown on less than 2,000 acres of land, the study says.

The study is a blow to efforts by farmers in a number of states to get the federal government to legalize production of industrial hemp. The Drug Enforcement Administration and the White House drug policy office say that legalizing hemp farming would make it more difficult to control marijuana production.

Nine states – Arkansas, California, Hawaii, Illinois, Minnesota, Montana, New Mexico, North Dakota and Virginia – passed pro-hemp bills last year that provide for research, study or potential production of the crop, and the first U.S. test plots were planted in Hawaii last month.

Some 35,000 acres were grown last year in Canada, which legalized hemp production in 1998.

Hemp supporters say that new uses and markets for the crop will develop once it is clear to investors and companies that there will be a supply available.

“It’s like soybeans 30 years ago,” Gale Glenn, a retired tobacco grower who is vice chairwoman of the North American Industrial Hemp Council, said Monday. “The markets will grow, but the markets aren’t going to grow until they have the raw material.”

The USDA study doesn’t foresee see much demand for any of hemp’s uses:

  • As a fiber, it’s main competitor is linen, which is made from flax. There is little textile flax production in the United States, despite the lack of legal barriers, and that suggests there wouldn’t be enough demand for hemp fiber to make it profitable, the study said.
  • Hemp seeds and flour are being added to nutrition bars, tortilla chips and other food items. USDA says that will probably remain a small use, comparable to the market for sesame and poppy seeds.
  • As for hemp oil, it can’t be used for frying, it has a short shelf life, and it hasn’t been approved by the Food and Drug Administration as a salad oil. Hemp oil is currently used in lotions, shampoo and other body-care products and also is sold as a nutritional supplement.

With such limited markets, farmers run the risk of quickly overproducing the crop and driving down prices, the study said, citing among other things the collapse several years ago in the market for emu meat.

Copyright © 2000, Associated Press. All rights reserved.