Hemp was first planted in Kentucky by Archibald McNeil on Clarke’s Creek near Danville in 1775. Hemp cultivation flourished in Kentucky between 1830 and 1860 because of strong demand for sailcloth and cordage, and again during WWII when imported abaca and jute from southern and eastern Asia became temporarily unavailable. From the Revolutionary period until the 1860s, Kentucky was the principal producer of hemp in the United States.
A study conducted by the University of Kentucky comparing 14 common crops determined that hemp could quickly become the third most profitable crop harvested in Kentucky. If one processing facility and one industrial hemp paper-pulp mill were established in Kentucky, hemp could have an economic impact equivalent to 771 full-time jobs and $17,600,000 in worker earnings within 5 years.
In February 1937, on the eve of the passage of the federal Marijuana Tax Act, Mechanical Engineering published an article entitled, “Hemp: The Most Profitable And Desirable Crop That Can Be Grown,” detailing the environmental and economic benefits of Cannabis sativa. Less than a year later, Popular Mechanics touted industrial hemp as a “billion dollar crop…it can be used to produce more than 25,000 products ranging from dynamite to Cellophane.” More than 70 years later, hemp products are more numerous, more various, and more ubiquitous than ever: body lotions, salad dressings, apparel, fuels, insulation, animal bedding, paper, biomass composites, and much more. Although there is no official valuation of U.S. sales of hemp-based products, industry representatives and researchers claim that retail sales in North America exceed $400 million annually. Hemp remains a cost effective, environmentally-friendly substitute for polyester, cotton, fiberglass, and concrete, as well as a potential source of fuel. Unfortunately, American farmers and manufacturers, stymied by federal prohibitions on industrial hemp, have yet to capitalize on the emerging market for raw hemp and hemp products.
Between 1990 and 2000 a number of countries, including France and China, more than doubled their annual yield of industrial hemp. In 1996 global production of hemp fiber exceeded 55,000 metric tons.
Germany, Australia, England, and Canada resumed commercial production of industrial hemp in the early 1990s after decades of prohibition. In Canada, approximately 200 growers, cultivating 10,000 hectares, are licensed by Health Canada to grow Cannabis. It is expected that industrial hemp will contribute more than $100 million to Canada’s economy by 2015.
Over thirty countries currently produce industrial hemp, including Australia, Austria, Canada, Chile, China, Denmark, Egypt, Finland, France, Germany, Great Britain, Hungary, India, Italy, Japan, Korea, Netherlands, New Zealand, Poland, Portugal, Romania, Russia, Slovenia, Spain, Sweden, Switzerland, Thailand, Turkey and Ukraine.
Several factors suggest that hemp cultivation in developed nations will increase and the market for hemp goods will continue to grow throughout the 21st century as environmental concerns and regulatory pressures compel manufacturers to seek out alternative commodities for food, fuel, fiber, and building materials. The demand for industrial hemp is likely to increase during periods of scarcity or political instability as the cost of oil and other commodities rise sharply. In the near future, increasing demand for industrial hemp will spur further research into new potential uses for Cannabis and Cannabis derivatives.
A study conducted by the University of Kentucky’s Center for Business and Economic Research in 1998 detailed the potential economic benefits of industrial hemp in a single agricultural community: By cultivating 27,650 acres for straw, grain, and seed, and creating one decorticating facility and one industrial hemp paper-pulp plant, a single community could generate more than 700 full time jobs and more than $17 million in worker earnings.
The UK study concluded that the certified seed could generate as much as $605 of profit per acre for farmers, or $545 per acre if the hemp straw byproduct could not be sold. The profit for growing industrial hemp for grain and straw would lead to a profit of $320 per acre. Additionally, the study concluded that there may also be a large potential market for industrial hemp seed meal as a supplement to cattle feed.
Markets and industries associated with new industrial crops typically mature over the course of 10-15 years. Although the United States has been importing industrial hemp from Europe and Asia for several decades, North American production of hemp is still in it’s infancy. The sweep of recent history suggests that the federal government will soon act to lift or loosen prohibitions on industrial hemp production in the U.S., and by building local expertise and infrastructure those states that legalize and regulate hemp cultivation first may be able to capture early investments in the industry and create a solid foundation for prosperity and growth.