At the end of 2018, lawmakers in Washington DC inserted language into the 2018 federal farm subsidies bill that legalized the cultivation of hemp and the production of CBD oil. Since then, a growing number of US farmers have considered converting part or all of their operations to producing hemp.
In fact, according to advocacy group Vote Hemp, licensed hemp acreage increased more than 445% over the past year. More than half a million acres of hemp were licensed in 2019. That’s up from just over 100,000 acres in 2018. And the current rate of growth is expected to continue for some time.
Although there are a lot of startups jumping into the ring, quite a few growers of grains, produce, and ornamentals, and even chicken farmers are converting their operations to the production of hemp hoping to cash in on the Green Rush.
Because hemp is relatively new to US farmers, newcomers and established farms alike have a lot to learn about the cultivation of this complex crop.
For starters, there are two completely different types of hemp to choose from. Each has its own cultivation requirements and its own markets.
What are the two kinds of hemp?
When considering converting an operation over from food production or another commodity the single most important consideration is which type of hemp to cultivate.
Hemp cultivation can be divided into two categories: industrial hemp and phytocannabinoid-rich hemp, or PCR hemp, also sometimes called CBD hemp.
Hemp is defined by the federal government and most states as strains of cannabis that produce no more than 0.3 percent THC. THC is the compound found in marijuana that is responsible for the high. Beyond that, the law makes no distinction between the two types of hemp. Much of the mainstream news related to hemp also fails to point out the distinction between these crops.
Countless new reports have referred to hemp as both “marijuana’s non-intoxicating cousin” and “the plant with 10,000 uses.” Although this is technically correct, the two crops being referred to here are actually completely different types of hemp with completely different requirements and challenges.
The crops we are referring to here are industrial hemp, and phytocannabinoid-rich hemp. The first is grown for its fibers and seeds. The latter is produced for its resinous flower clusters.
However, one thing these two crops have in common is that they are both highly regulated. In an effort to prevent farmers from secretly growing marijuana in their hemp fields, many states have implemented strict growing, testing, processing, and distribution regulations. Meanwhile, some states have even opted to ban the production of hemp altogether.
Industrial hemp cultivation
Hemp has been cultivated by humans since before the dawn of civilization. It’s an extremely valuable plant with a myriad of uses in both industry and food production.
The class of cannabis that is cultivated for fibers and seeds is most often referred to as industrial hemp. It is also sometimes referred to as agricultural hemp.
The tough, fast-growing fibers of the hemp plant are used for a variety of purposes including thousands of different types of textiles and construction materials. Even products such as plastic and concrete can be made from hemp. Hempcrete, as it’s been dubbed, produces fewer greenhouse gasses than standard concrete and is considered to be more environmentally friendly.
Hemp also produces copious quantities of highly nutritious seeds. Hemp seeds are considered by many nutritionists to be a “superfood.” They are rich in protein, amino acids, vitamins, and minerals, as well as beneficial fats known as omega fatty acids. Omega fats are effective in reducing inflammation throughout the human body.
Industrial hemp is grown in much the same way as traditional grains — tightly packed together in vast fields. Hemp can grow to extreme heights in a single growing season, sometimes reaching heights of 12 feet or more.
Industrial hemp is typically grown outdoors and can be grown in a variety of climates. Although hemp can be grown in all 50 US states, the plant is most productive in sandy soils.
Industrial hemp can be farmed, for the most part, using the same machinery that is used to cultivate and harvest grains. That being said, new technologies are emerging each year delivering new equipment and processes dedicated specifically to hemp cultivation, harvest, and processing.
Industrial hemp is relatively low in medicinal compounds known as cannabinoids and terpenes and is therefore not a viable crop for the production of CBD oil. To produce CBD oil another type of hemp is required.
Phytocannabinoid-rich hemp cultivation (PCR hemp)
While industrial hemp is produced for its fibers and seeds, the phytocannabinoid-rich hemp (PCR hemp) that is used to produce CBD oil is grown specifically for its resinous flower clusters. However, the remaining biomass of the plant is also valuable for its fiber content.
As opposed to being cultivated like a grain, PCR hemp is grown using much the same methods as those employed in growing marijuana. PCR hemp is grown in plots or pots giving it room to spread out. PCR hemp is generally much shorter and bushier than industrial hemp. The plants are also “topped” to promote branching.
And in order to avoid seed production, only female plants are grown. Generally, this is achieved using clones of pre-identified female plants. Feminized seeds are also becoming more common. Any plants producing male pollen sacs must be culled to avoid pollination of the female flowers.
Growing PCR hemp presents a different set of challenges from growing industrial hemp. First, growers must pay far more attention to genetics. This is because different strains of PCR hemp produce different levels of cannabinoids and terpenes. As a result, each strain produces its own particular assortment of medicinal effects. For example, while one PCR hemp strain might be effective for promoting sleep, another might promote wakefulness.
Secondly, the conditions under which PCR hemp must be grown are far more stringent. In order to maximize the production of phytocannabinoids variables such as nutrients, water, light, temperature, and humidity must be carefully controlled. This level of control is best achieved in a greenhouse environment. That being said, however, many farmers have had success growing PCR hemp outdoors.
And finally, while industrial hemp can be harvested using traditional equipment such as combines, PCR hemp is often harvested and processed manually. The plants must be hung to dry — a process known as curing — and then trimmed to remove stems and leaves.
The dried flowers are then put through a series of extraction and distillation processes to remove unwanted plant matter and compounds such as chlorophyll to produce a palatable, phytocannabinoid- and terpene-rich oil. This product can be further refined to produce near-pure CBD. While raw CBD oil is bitter and pungent, purified CBD is colorless, odorless and flavorless making it ideal as a food additive.
Case study: ColorPoint
Just recently it was announced that AgTech Scientific, a hemp company in Paris, Kentucky, has merged with ColorPoint, formerly a large player in the ornamental horticulture industry.
Up until the conversion, ColorPoint had been supplying ornamentals to national retailers including Walmart, Lowe’s, and Aldi supermarkets.
In 2017, ColorPoint began growing hemp clones for AgTech Scientific. By 2019, ColorPoint had converted its entire 2-million-square-foot Paris greenhouse operation to hemp production and the extraction of CBD-rich oil.
AgTech currently operates a 30,000-square-foot extraction facility and is building a new 50,000-square-foot facility that is expected to be operational by the end of 2019. The new facility will house laboratories, extraction systems, and product manufacturing equipment. When the facility first opens it is expected to process 4,000 pounds per day of hemp biomass. Production is expected to increase to 14,000 pounds per day (that’s 2,250 metric tons of biomass per year) before the end of 2020.
AgTech Scientific expects to be producing up to 11,000 kilograms (24,251 pounds) of pure CBD isolate each month before the end of 2020. At around $25 per gram, give or take, that’s a wholesale value of $275 million.
Choosing the right hemp software is critical
Whether you are cultivating phytocannabinoid-rich hemp for CBD oil or smokable hemp or exploring the myriad of opportunities presented by the industrial hemp market, success in the burgeoning hemp industry depends on the strategic implementation of dedicated cannabis seed-to-sale software and ERP systems.
No matter which type of hemp a company chooses to cultivate, you will need to remain in strict regulatory compliance. State hemp regulations oftentimes require growers to track the production from seed to sale including extraction and processing. Moreover, the cultivation of cannabis involves numerous variables that are specific to the crop.
Viridian Sciences is a robust and highly advanced enterprise resource planning (ERP) system designed from the ground up specifically to help cannabis cultivators manage their operation as effectively and efficiently as possible in order to maximize profit margins while maintaining financial and regulatory compliance.
Viridian Sciences is built upon SAP Business One. SAP offers an affordable way to manage your entire business as an integrated whole, from accounting and financials, purchasing, inventory, sales and customer relationships, to operations, project management and human resources. More than 60,000 businesses around the world including agri-businesses run on SAP Business One. Navigator Business Solutions, makers of Viridian Sciences cannabis software, has been an SAP top partner for the past 13 years.
Features of Viridian Sciences cannabis ERP software include:
- Cultivation Management
- Costing and Valuation
- Equipment Management
- Processing and Extraction
- Lab Testing and Samples
- Crop Cycle Management
- Inventory Management
- Vendor Relationship Management
- Human Resources Management
- Regulatory Reporting
- Financials and Tax Reporting
Learn more about Viridian Sciences hemp cultivation software.
Call Viridian Sciences today at (385) 323-9115 or email us at email@example.com to schedule a demo.