Can Oregon Processors Keep Up with Oregon Hemp?
Oregon’s next bumper crop may end up being industrial hemp, the nearly THC-free cousin of marijuana, grown for recreational and medical use (industrial hemp and marijuana are different varieties of the cannabis plant). With the 2019 planting season in full swing, Oregon farmers have registered to grow around 50,000 acres of hemp this year, a huge increase over last year’s 11,754 acres, which could amount to a crop worth at least $2 billion this fall. That is more than double Oregon’s highest value agricultural category in 2017 — greenhouse and nursery.
Hemp is grown in nearly all of Oregon’s 36 counties, with Jackson and Josephine counties in southwest Oregon topping the list.
The primary product resulting from all of this hemp is an extract called cannabidiol or “CBD.” CBD seems to be the current wonder drug of our times — it’s hard to find an ailment that CBD is not lauded to cure and some figures indicate that it is used in more than 30,000 products. The fibers from hemp can also be used, primarily for clothing and as a construction material.
However, getting CBD out of hemp requires higher capacities from processors and it is unclear as to whether Oregon hemp processors can keep up with the demand of this ever-expanding crop. The lack of sufficient processors may ultimately cause a pinch point.
Oregon processors are expanding, but not just in-state. For example, Socati Corp., an Oregon processor that specializes in manufacturing THC-fee hemp extracts, recently purchased the Montana company, Blue Marble Biomaterials, a large-scale manufacturer of specialty compounds for consumer goods with a 22,000-square foot manufacturing facility near the Missoula airport. Socati expects to expand the Blue Marble facility’s capacity to a production capability of 10 tons of hemp per day. Because industrial hemp is not restricted from interstate transport like marijuana, Oregon is viewed as being well-positioned for both hemp production as well as hemp extract manufacturing.
The jury’s still out on whether Oregon processors will be able to manage the volumes produced in-state, but market analysts will have to wait a few months longer to find out. The harvests won’t start until October.
Oregon’s next bumper crop may end up being industrial hemp, the nearly THC-free cousin of marijuana, grown for recreational andr medical use.
Oregon hemp farm suing processors for $11 million
Published January 14, 2020
A farm in southern Oregon is suing a group of processors who they say failed to show up and harvest and process its hemp after receiving a six-figure down payment.
- Palex Enterprises.
- Hemp Warehouse.
- Great Horizons.
- Four individuals.
The lawsuit, claiming civil fraud, unlawful trade practices and breach of contract, seeks more than $11 million, according to the (Medford) Mail Tribune.
Jefferson State Farms says the defendants were paid $136,000 to harvest their crop of 112,500 hemp plants beginning Oct. 9, 2019.
After confronting the companies, the Yuma say, they received $50,000 back from the companies but never received the final $86,000 of the down payment, despite promises of repayment.
Jefferson State Farms wants to collect the outstanding $86,000 that they paid, plus $200,000 to reimburse replacement harvesting and drying services and $11.2 million for “consequential damages” for the crop, the newspaper reported.
The case is pending in Jackson County Circuit Court.
Jefferson State Farms alleges its crop, which would have been worth $11.2 million, was sold as combined biomass for $10 per pound after the crop rotted in the field.
More details about the lawsuit are available here.
Jefferson State Farms in southern Oregon is suing a group of processors who they say failed to show up and harvest and process its hemp after payment.