ENVIRONMENT

'Biggest thing to happen to agriculture in my lifetime': Hemp could soon be grown in Indiana

Farm fields across the state may soon look a bit different: Hemp is on the horizon in Indiana. 

After years of hemming and hawing over the prospect of expanding hemp production to Indiana — and years of not doing anything about it — politicians, farmers and experts all expect 2019 to be the year that marijuana's non-psychedelic cousin finally gets the green light. 

That's because of the federal 2018 Farm Bill, which was passed by Congress and signed into law by President Donald Trump in December. Part of that law removes industrial hemp from the Controlled Substances Act, now making it a legal crop

"This is the biggest thing to happen to agriculture in Indiana in my lifetime," said Mark Boyer, a sixth generation farmer in Converse. "Hemp holds a lot of promise for Hoosiers, for what it could do for farming, for business and for individual folks."  

Hemp seeds on the farm of Mark Boyer, Converse, Wednesday, Jan. 9, 2019. The sixth generation family farm grows corn, and makes oil from sunflowers, canola, and hemp, which is part of a research plot.

There are believed to be more than 20,000 different uses for hemp, from medicinal and food grade oils from the seeds to paper and clothing from the fibers. Industry analysts predict the hemp market could hit more than $20 billion in the next three to five years. 

"It really is going to have an enormous impact nationally and in Indiana, as well," said Jonathan Miller, general counsel to the U.S. Hemp Roundtable.

Still, Indiana is behind many states when it comes to hemp. After the 2014 farm bill —which allowed research institutions to get approval from the U.S. Drug Enforcement Administration to grow hemp for research — 41 states passed legislation and approved programs to do so. 

David Williams, right, speaks to media after a small plot of hemp was harvested at a University of Kentucky farm near Lexington, Ky. The 2015 spring planting season is expected to include at least several hundred acres of industrial hemp, Adam Watson, the state Agriculture Department's hemp program coordinator, said Monday, April 6, 2015. Statewide hemp plantings totaled about three dozen acres last year, he said.

Indiana is among them, with a program at Purdue University that has planted 24 acres. While that research has been important, according to Justin Swanson, it also has been small scale.  

"Of the states that have hemp programs after 2014, we're dead last," said Swanson, a board member of the Indiana Hemp Industries Association and founding member of the Midwest Hemp Council. "Indiana certainly is not first to the hemp game, but we have the opportunity to be the first to do it right." 

Before that can happen, the state must set up its own oversight program to regulate the production of industrial hemp, which can't produce a high and contains less than 0.3 percent THC, the psychoactive ingredient in marijuana. That program, which must be approved by the U.S. Department of Agriculture, will identify the governing body and create the licensing system.

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Three bills have been filed in the state legislature this year to do just that, two in the Senate and one in the House. 

"I think it's possible to get something in place by growing season this year," said Rep. Don Lehe, who represents counties in west central Indiana. He served on a committee to study the possibility of legalizing the plant. Planting season is around April or May, depending on the weather. 

"With the farm bill action," he added, "that will diminish a huge part of the opposition that was there in the past." 

A bill last year that would have allowed farmers to grow industrial hemp hit road blocks when Gov. Eric Holcomb raised questions about the state's readiness to regulate the industry. The Senate voted to strip the bill and instead only referred it to Lehe's Agriculture and Natural Resources interim committee to study. 

"We've studied it to death in Indiana over the last few years, so it's time to sink or swim  — are we going to do this or not?" Swanson told IndyStar. "Of any of the bills in this session, this will be one of the true jobs bills that is creating industry and creating jobs."

As a large agriculture state with a heavy manufacturing presence, Indiana can become a leader in the hemp industry, according to experts. 

A banner for the Indiana Grown organization on the farm of Mark Boyer, Converse, Wednesday, Jan. 9, 2019. The group is billed as supporting a new generation of Hoosier farmers.

Historically, Indiana was a big producer of hemp before cannabis became federally regulated in the 1970s. It has potential wherever corn grows well, according to Janna Beckerman, a Purdue professor and researcher who studies hemp. Still, it is not disease resistant, she said, and will require weed and pest management. 

There is demand throughout the state for both the seeds and fiber, she added, but little infrastructure to get the crop from the farmer to those interested manufacturers. 

At one time, FlexForm Technologies in Elkhart was the largest importer of hemp products in the U.S. Currently, more than 30 nations grow industrial hemp and sell it on the world market.

FlexForm creates natural fiber mats and panel products that are used in cars and trucks, office interiors, aircraft and packaging. The company currently imports about 80,000 pounds of natural fiber — often hemp, sometimes flax — each week, with the vast majority coming from southeast Asia. 

"Why do I have to import my raw material when the rest of the supply chain takes place within 200 miles of our location?" asked Gregg Baumbaugh, the CEO of FlexForm. "It would be fantastic if we could get it locally, it would help us economically and help farmers in Indiana. It just makes sense." 

Hemp seeds on the farm of Mark Boyer, Converse, Wednesday, Jan. 9, 2019. The sixth generation family farm grows corn, and makes oil from sunflowers, canola, and hemp, which is part of a research plot.

It would take roughly 4,000 acres of hemp to cover the company's needs, Baumbaugh told IndyStar. 

Indiana farmers have shown an "extreme amount of interest" in growing hemp, according to Marty Mahan, president of the Indiana Farmers Union hemp chapter. And it keeps "growing more and more," he said. 

"It's pretty tough to make a decent living off of corn and soy with grain prices what they are right now," the fifth-generation farmer said.

Industrial hemp was fetching prices that were about $100 to $300 more per acre compared to corn or soy beans, according to Mahan. Hemp is not expected to replace either crop, he added, but it offers farmers a way to diversify.

"I think a lot of farmers would get on board with it," he said. "To get another crop that provides more income than traditional row crops will keep family farms and smaller farmers afloat a little longer." 

Boyer is one such farmer who looked to specialty crops to ensure he could pass his farm down to the seventh generation. About five years ago, he began growing sunflowers and canola to press into food-grade oils.

Sunflower seeds being expelled after having the oil pressed from them on the farm of Mark Boyer, Converse, Wednesday, Jan. 9, 2019. The processing of hemp seeds looks similar, and Boyer is looking at possible uses for the expelled seed.

Through Purdue, Boyer was licensed to plant roughly 12 acres of industrial hemp last year to study if it could be harvested with conventional equipment. He was successful, and recently bottled his first batch of hemp seed oil that will be ready to hit shelves once legal in Indiana. 

It differs from CBD oil — also derived from the hemp plant — which was legalized to be sold in Indiana last March and is believed to have medical benefits. 

He said there is an existing market in Indiana that he thinks will continue to grow rapidly as the changes from the farm bill roll out. The federal law authorizes crop insurance for hemp and makes businesses and banks more likely to invest in the hemp industry. 

The total retail value of hemp products sold in the U.S. in 2017 was around $1 billion, according to research by the Hemp Business Journal. The U.S. is the largest consumer market for hemp products in the world. 

That number is expected to grow tenfold in the coming years as the industry is poised to explode, Miller said. 

"The era of hemp prohibition is over," he said. "An exciting, emerging, multibillion-dollar hemp industry is now unleashed, providing economic opportunity to farmers and businesses in Indiana and all across America."

Call IndyStar reporter Sarah Bowman at 317-444-6129 or email at sarah.bowman@indystar.com. Follow her on Twitter and Facebook: @IndyStarSarah. Connect with IndyStar’s environmental reporters: Join The Scrub on Facebook.

IndyStar's environmental reporting project is made possible through the generous support of the nonprofit Nina Mason Pulliam Charitable Trust.