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Revenue, potential high but so are the costs

Posted on September 20, 2005

Nesbitt, Manitoba, Canada — Dust and straw fly around Alan McKenzie’s combine as its blades release the field-fresh scent that reveals the unusual crop’s identity.

This is the 32-year-old farmer’s second shot at growing organic hemp for a budding market. After last year’s poor crop, he planted 200 acres on two fields in what he called his “do or die year.” Despite this year’s heavy rainfall that negatively affected farm production across the province, McKenzie has decided to continue growing hemp.

“There’s so much money tied up in what-ifs and maybes. I kind of stuck my neck out,” McKenzie said yesterday, as he combined his Nesbitt field.

This is no ordinary crop, however. Also known as cannabis sativa, it’s related to illegal marijuana and Health Canada takes several costly precautions. Before planting his two fields — one in Nesbitt 30 kilometres south of Brandon and the other near Glenboro — McKenzie underwent the necessary criminal record check before he received a licence to grow the alternative crop for its seed. He also gave Health Canada his field’s global positioning system co-ordinates so it could be inspected at any time.

During the summer, McKenzie had to pay $500 for his crops’ delta 9 tetrahydrocannabinol (THC) levels to be tested for Health Canada. THC is the ingredient in cannabis that causes psychotropic activity. Industrial hemp cannot exceed 0.3 milligrams of THC.

“It’s very expensive. It’s just one more thing,” he said, about the testing.

But this isn’t his only added expense. McKenzie was a pregnant mares’ urine rancher until two years ago when he switched to producing organic crops and cattle. He is so determined to produce this crop that will end up on the international food market as whole seed, toasted seed or hemp oil, that’s he’s invested in a straight cut header combine and aerator bin.

Organic hemp seeds cost about four times the price of organic oat seed. Although McKenzie expects his larger field will just break even this year, his Nesbitt crop looks promising. He estimated he will yield 250 lbs/acre on the 50 acre field.

“I think it’s got potential,” he said about the industry.

He is under contract with Hemp Oil Canada Inc.

“There are additional costs but their net revenue is a lot higher,” said Shaun Crew, Hemp Oil Canada president.

Crew estimated there are 75 Manitoba farmers producing hemp seed.

Hemp producers have increased by 140 per cent in the last two years. Hemp field acreage increased four times since last year, he said.

The crop loves damp soil but can’t handle standing water, which makes the Prairie provinces good producers for the crop.

Nearly all of the province’s hemp producers are under contract for either Manitoba Harvest or Hemp Oil Canada, Crew said.

Hemp is a good rotational crop as it fixes nitrogen in the soil.

Copyright © 2005, The Brandon Sun. All rights reserved.