Colorado’s Young Hemp Industry Matures

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In partnership with: Colorado Department of Agriculture

Photo credit: Nathan Lambrecht

When the 2014 Farm Bill legalized industrial hemp cultivation, Colorado was the first state to establish a regulatory structure. “[Colorado] embraced hemp quickly, and got a head start on quite a few other states,” says Brian Koontz, hemp program manager for the Colorado Department of Agriculture (CDA). From 2014 to 2020, the program has more than doubled in size annually, with the average hemp field increasing from 5 to 10 acres and now averaging more than 20 acres.

Colorado was also the first state to establish a certified seed program and now breeds 17 varieties of nationally certified hemp seed. Hemp is cultivated from the cannabis plant and is distinguished by various qualities, most notably its low THC levels – no more than 0.3% – and used in commodities from grains to textiles and more. In recent years, it’s soared in popularity thanks to the demand for cannabidiol (CBD) products.

In short, Colorado’s young industry is booming. What’s ahead for hemp?

Photo credit: Heather Nash

Growing Pains

In the 2018 Farm Bill, the USDA defined hemp as a legal agricultural commodity. Soon, large-scale farmers began cultivating the crop. “We have a lot of people who’ve supplemented their corn or wheat or hay production with hemp,” Koontz says. “It’s a less risky, more reliable crop to cultivate after the 2018 Farm Bill.”

With this legalization comes growth for the industry, as well as growing pains. The 2018 Farm Bill requires all states with a hemp program to meet the same requirements. The benefit of this is an even playing field, explains Laura Pottorff, plant health and certification section chief for CDA. But for Colorado, new restrictions also mean shifting how the program has functioned since 2014.

“One of the challenges is that we’re dealing with a crop that has a cousin that’s still very heavily regulated,” Koontz says. Being so closely related to marijuana means regulations for hemp are extra stringent. Pottorff says that would-be growers sometimes overlook the regulations placed on hemp cultivation. “Our challenge is to educate; not to discourage people from taking part, but to (remind them) they need to do their due diligence.”

See more:?Hemp Makes History in Colorado

Correcting the Market

The year 2020 brought a significant shift in Colorado’s hemp industry. Surprisingly, the change was rooted less in the coronavirus pandemic than a market correction. After product flooded the market in 2019, many growers had surplus crops in 2020 and didn’t bother planting again. “Today, we have about a 55% decrease in the number of registrations,” Pottorff says. “Although no one could deny (the pandemic) had an impact, a lot of the folks who were growing the crops felt that changes were mostly due to the market.”

Of course, any kind of economic downturn is tough on smaller growers, and the pandemic made it difficult for small farmers to compete. But in general, Koontz believes that although 2020 was a challenging year economically for hemp, the industry will continue to grow because more states have an approved hemp plan and the supply chain continues to strengthen.

Hemp farmer Bob Sievers (back) works with CDA's Wondirad Gebru and Brian Koontz. Photo credit: Colorado Department of Agriculture
Hemp farmer Bob Sievers (back) works with CDA’s Wondirad Gebru and Brian Koontz. Photo credit: Colorado Department of Agriculture

Innovations to Come

Being a young industry leaves plenty of room for improvement. In the coming years, Koontz foresees innovations in banking and insurance options for growers: “There needs to be a better mechanism for helping cultivators to finance their crop or their operation and to obtain crop insurance.”

With more research and development, plant scientists can breed hemp for a low THC level and characteristics for specific markets. Pottorff believes breeding breakthroughs will come with time, making hemp a more mainstream agricultural crop. “I think it’s coming, but it’s going to take a lot of science and a lot of research and development,” she says.

See more:?Farmers Experimenting With Hemp Hope for Success

Both Koontz and Pottorff look forward to the development of more markets. Right now, CBD takes up the lion’s share, but they hope demand will increase for hemp in fiber, construction materials and grain. “Hemp is (already) utilized as a food source in granola bars, cereal, etc.,” Pottorff says, “but we’re getting most of it from Canada and China. It would be really exciting to see that develop in the U.S.”

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