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Carolina’s next cash crop?: Farm bill will add hemp into more growers’ rotation

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With Congress’ passage of last week’s farm bill that decriminalized the hemp plant, North Carolina farmers will have the choice of adding a needed money crop to their rotations.

“I haven’t read the whole thing. It’s 800 pages and 6 inches thick, but I think it’s going to be a good thing for North Carolina,” said Mann Mullen, who has experimented with growing hemp and processing it.

Mullen is a farmer and the owner of tobacco warehouses in Wilson and Bunn.

President Trump signed the bill, also known as the Agricultural Improvement Act of 2018, on Dec. 20.

Since 1937, hemp has been illegal. It has been lumped in with its cousin marijuana on a federal schedule list of controlled substances and chemicals.

North Carolina was one of a handful of states that permitted experimental hemp growing and processing in 2014 when it established the North Carolina Industrial Hemp Pilot Program administered through the N.C. Industrial Hemp Commission.

Mullen is one of the growing number of registered growers and processors in the state.

“I would like for it to be something that North Carolina could thrive on for years to come, and I think we can because I think the climate and the soil is just right,” Mullen said. “North Carolina, just like tobacco, has the perfect type of soil. I think it will be good.”

LEGAL STATUS WILL HELP

Tony Finch, a Nash County farmer, has grown kenaf, a cousin of hemp, for its fiber. He’s grown hemp for its cannabidiol, also known as CBD, an extract from the flowering tops that is used medicinally.

Finch said hemp’s new legal status should alleviate a whole lot of little issues.

One is operating expenses and the ability to get a loan.

“A lot of financial institutions won’t touch it because it was on the scheduled substance list. It wouldn’t allow you to borrow money,” Finch said.

Finch and Mullen hope the new legal status will help in getting crop insurance.

“You can tie of a lot of money in hemp and for some reason, a natural disaster comes along and you lose the crop, a man can stand to lose a lot of money,” Finch said.

Finch said people will generally be a whole lot less nervous about growing the crop.

“There are a lot of people still a little bit skeptical about that because it’s hemp, and they still say it was a scheduled substance,” Finch said. “I think that gave some people reservations about growing the crop. I am hoping that it will help with interstate commerce on the stuff as far as what you would call transporting the seed and plant parts, the flower for the CBD, transporting across state lines. That will make that very simple. No more issues there.”

Bruce Perlowin, CEO of Hemp Inc., whose Spring Hope facility is the largest hemp processor in the western hemisphere, said he’s excited by the removal of legal issues that have, up to now, hampered development of the industry.

“It took $20 million in three and a half years to build that plant. Now that it’s built, North Carolina becomes the inheritors of that infrastructure,” Perlowin said. “It is going to be hard for farmers anywhere else that don’t have a local processing center to process the hemp. I am glad we did it. North Carolina is a great state and can grow a lot of hemp.”

Perlowin said he has been looking forward to hemp legalization for a long time.

“Now that it is here, it is sort of an ecstatic moment for the entire industry,” Perlowin said.

Perlowin said the legality issue for hemp will change the industry “drastically.”

“We are going to be growing hemp now just like corn or soybeans or peanuts, tobacco or cotton,” Perlowin said.

Perlowin agreed that the ability to get crop insurance will be a major change for farmers.

“That really, really made a difference in North Carolina last year,” Perlowin said. “I don’t even want to tell you how many acres were destroyed by the hurricane. If we had crop insurance, all of those farmers would not have been hurt as bad as they got hurt last year. We can plant with confidence and security that we can actually have crop insurance.”

“We are going to shoot for 20,000 acres this year in North Carolina collectively,” Perlowin said.

Perlowin said Mullen is going to play a big part of that.

GOOD OUTLOOK FOR n.C.

Last year, Mullen used one of his warehouses as a drying facility for hemp.

“I hope we can have a processor and put up an extrication facility in one of my places,” Mullen said. “Right now we are trying to contract growers to grow for us and the reason being is I want to build that trust with the grower that we are going to do the right thing before big business gets into it.”

Mullen wants to develop his own market and be able to weather the storm.

“Right now I believe it’s going to be a race to the bottom. Prices are high, but I have got a feeling that’s one of the downfalls of passing the farm bill is it opens up the floodgate for everyone to grow, and that’s not a bad thing, except the high prices that we have seen will probably equalize, and that’s OK too.”

Mullen said there is so much out there that has not been discovered about hemp, its qualities and what it can do, all of the medicinal and food purposes.
“A lot of those things haven’t been discovered yet because it has been illegal,” Mullen said. “So we are sitting on the edge of technology to take over now. I would like for it to be something that the farmers could grow for years to come.”

Finch said next year he plans to grow kenaf for its fiber and hemp for the CBD.

“I can make more money with 50 acres of hemp than I can 300 acres of kenaf,” Finch said.

Growing hemp for the money it makes will help him pay bills and grow other traditional crops like sweet potatoes, corn, soybeans and wheat.

“Those grain crops don’t make big money, but they are excellent for the land from a rotational aspect, and all that grain goes to, more or less, stay in the local community and goes into feed for the chickens and hogs and turkeys in our area,” Finch said. “I think hemp is not just about making money for the farm. It is the whole economy in the state.”

Based on what he has seen, Finch thinks hemp will do well in North Carolina.

“We have got a little bit of learning to do still, but it’s going to do really well,” Finch said. “The second year I did a lot better than my first year. Maybe I will do a little better on my third year. It’s going to take just a little while, but it will grow well in North Carolina.”

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