As a new generation of hemp farmers and entrepreneurs take root across the country there are a multitude of risks that can take a new business down in the first years of establishment. Even the most seasoned farmer and savvy business person will encounter unforeseen obstacles in any stage of the process. These can become valuable lessons or fatal blows, and a well-developed business plan is the best defense against the latter.
Employing credentialed consultants to address potential problems, solutions, and make projections based on research and the valuable experience of others is the best way to forecast for success. Fortunately, Texas is home to a variety of advisors to guide you through every part of the process from seed to sale.
Assistance with business compliance and formation can be found with lawyers and accountants who specialize in hemp and marijuana law. Here in Texas, Ritter Spencer is known for their expertise in compliance and Cannabis Business Law Group-Coats Rose brings significant experience from across the supply chain in multiple jurisdictions that focus on commercial litigation. Carr Riggs and Ingram CPAs can help with tax questions, business set up, insurance and employee benefits packages. Navigating the nuances of regulatory compliance, government tax requirements, hemp/medical marijuana licensing, product labeling/marketing, and real estate issues in a rapidly changing landscape is tricky. Choosing a firm that specializes in this heavily regulated niche industry will provide guidance from the outset and insure compliance for your endeavor.
Consider the benefits of growing indoors in a greenhouse, or a land lease. The Texas Hemp Ranch in Webberville leases 10 acre pre-fertilized plots with two grow cycles and well water access or irrigation from the Colorado river. Avery Barksdale at Texas Greenland Development Company offers 5-400 acres to lease monthly or seasonally in several areas of Texas. Using greenhouses provides protection from the elements as well as pests. Customize the configuration to meet the needs of the landscape for the best outcome of your product by speaking with the experts at Reef Industries. They source a variety of laminates and provide fabrication options to suit every need.
With so many companies to choose from that offer seeds and starts getting a cross section of information about suitable varietals and methods is important. Factors to consider are latitude, soil PH, end use and certification. Uniseeds, Hydroshack, Riverside Hemp, and Garcia Bros Organics provide consultation services along with products to help farmers best determine which processes and products are best for their conditions.
Scientific analysis of soil, water, and fertilizers is the most effective way to determine what kind of additives to use for a successful harvest. TPS agricultural provides data analysis, DIY kits, lab consulting and solutions along with products to repair, stimulate, and improve production.
Identifying THC levels throughout the grow process is recommended, and certified lab tests are required at harvest time. Any laboratory testing hemp for THC concentration under the U.S. Domestic Hemp Production Program must be registered with the Drug Enforcement Administration to handle controlled substances. Zosi Analytical, and AFL Texas are both DEA approved and can identify toxins and provide cannabinoid and THC profiles. Some labs also offer manufacturing and consulting, labeling and R&D, shelf life studies and work with a variety of products from gummies to body products.
When it comes to harvesting, Texas Premium Hemp Producers LP in Ulm, TX are the experts in bucking and drying. Inpak Systems manufactures bag fillers and closers for seeds, flowers, dried pellets or chopped leaves and Hempsac manufactures the bags to protect and preserve the product during storage and transportation. Transporting the product poses a unique set of challenges where only experts should be employed like JW Transport Services.
All of these vendor contacts can be found in the Texas Hemp Reporter as well as here:
Adrian Garcia Farms, owned and operated by Adrian Garcia, is located in the west Texas town of Big Spring. Adrian has farmed cotton for the last three years on 200 acres of 100% USDA Certified Organic farmland. When the 2018 Farm Bill was signed, allowing for the cultivation of hemp, he turned his sights towards becoming one of the first organic farmers to grow hemp in Texas. He built a couple of greenhouses, sourced reliable CBD genetics and went through the USDA’s rigorous organic certification process and started growing hemp.
Garcia Bros Organics: 100% USDA and Texas Department of Agriculture Certified Organic Hemp Flower!
We discuss his celebratory win at the recent Taste of Texas Hemp Cup as Adrien and his family won the PEOPLES CHOICE award for flavor profile for his 2020 Berry Blossom flower.
The in-person event will be held in Houston, Texas on December 11 through 12 and feature networking, exhibitions, education, and seminars
Houston, Texas – October 28, 2020 – The Original CBD Expo South 2020 will be held in-person on December 11 through December 12, 2020 in Houston, Texas. The event, hosted by MACE Media Group, is the 17th conference by the creators of the Original Expo Tour and will be an exciting opportunity to bring the cannabis, wellness, and CBD communities together after nearly a year of virtual programming.
“We are looking forward to the opportunity to connect with and bring together our strong CBD community of leaders, new-entrants, and innovators,” said Celeste Miranda, founder and president of MACE Media Group and Cannabinoid Industry Association (CBDIA). “The CBD Expo is a time for us to reconnect, learn, and grow, both personally and professionally. We look forward to a safe and rewarding event.”
The event will feature exhibits from end products producers, equipment manufacturers, and ancillary businesses including financial and legal service providers that display the latest and most innovative advancements in CBD. Exhibitors will have the opportunity to directly engage with consumers, dispensary owners, and buyers from well-known entities like Whole Food, CVS Pharmacy, Starbucks Coffee, and Trader Joe’s.
In addition, the expo will offer unique cannabinoid education seminars from leading cannabis and cannabinoid PhDs, physicians, scientists, and researchers from around the globe. Seminar tracks include Research and Medicine, Regulation and Compliance, and Cannabinoid Education Certification.
Networking and community building opportunities will be at the forefront of this year’s event. Over 190,000 individuals have attended the CBD Expo since its inception and always brings a diverse group of cannabinoid and cannabis professionals within areas of education, advocacy, and business.
To attend this year’s event or learn more, visit us online at cbdexpo.net.
New restrictions and safety protocol will be in place due to COVID-19. To learn more about how we are protecting attendees and exhibitors, see here.Please direct all media inquiries to Chloe Latture at [email protected].
About MACE Media GroupMACE Media Group publishes niche cannabis industry trade publications. Its premiere title, Terpenes and Testing Magazine, was the first industry trade publication devoted to cannabis science. Its newer publications, CBD Health & Wellness Magazine, Extraction Magazine, and Hemp Farmer, revolve around the growing cannabinoid industry to provide news on trending applications, medical research, and updates with laws and regulations.
MACE also produces many trade events that attract dozens of cannabis and mainstream media journalists. Currently, MACE Media Group is producing a tour of CBD expos bringing together thousands of industry influencers, forming the most comprehensive CBD event in the United States.
Our friends from the Bayou talk to us about their recent hemp grow as they prepare for another grow season this next year. We learn about Riverside Hemp’s operations and product development.
Show Notes
CELEBRATING 28 YEARS IN HORTICULTURE I 2020 HEMP CROP.
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SEEDLINGS READY FOR PURCHASE
What is The Texas Hemp Show ?
The Texas Hemp Reporter new Podcast: The Texas Hemp Show is now recorded every Wednesday at 5pm and is released each week shortly afterwards. For news and the latest information on the growing Hemp industry in the Lone Star State.
Bringing wellness to the world through ultra-concentrated terpene rich CBD oil derived from all natural, high quality industrial hemp. The couple own Green Mountain Flower Company – a premier CBD boutique located in North Austin off of 183 and Anderson Mill – and their mission is to curate a personalized experience to your journey into hemp-based healing.
Gene talks with Russell and Jesse about plans to expand the Green Mountain product line with many exciting additions on the way such as their new CBD Water which they have been working on for over a year. As well as actively expanding their wholesale market.
California’s wine industry is quite the behemoth, a staple in the American economy.
If it were its own country, the state would be the fourth largest wine producer in the world. California makes 81 percent of all U.S. wine, and three out of every five bottles sold in the country comes from the Golden State.
Just look at last year’s numbers for more proof: In 2019, 241.5 million nine-liter cases of California wine were sold within the U.S., amassing an estimated $43.6 billion in sales. Also in 2019, American wine exports totalled $1.63 billion, with 95 percent coming from California wineries.
California wine sales in the U.S. grew 6 percent in 2019, despite the state legalizing adult-use cannabis in January 2018, which some feared would eat into the state’s wine market.
But 2020 may tell a vastly different story for the industry, says Robert P. Koch, president and CEO of the San Francisco-based Wine Institute. “This year will be more challenging, especially for small- and medium-sized wineries, because of the closure of tasting rooms and restaurants,” he says in a wineinstitute.orgarticle.
These changes have emerged because of COVID-19, of course, and while it is too early in the year to predict a drop in the California’s total revenue from wine, we can surely expect a noticeable dip based on the recession alone: People with a slash in their disposable incomes are less likely to buy a $50 bottle of Cabernet Franc from the Napa Valley, perhaps opting instead for $8 bottle from Argentina.
So considering this inevitable dip, should California vineyards, each with hundreds of acres perfect for agriculture (bountiful sun and cool air from the Pacific Ocean), consider pivoting to a crop with perhaps an even more promising future? Such as hemp?
After all, according to the Brightfield Group, the market for hemp-derived CBD is expected to reach $23.7 billion by 2023, thanks in part to the passing of the 2018 Farm Bill. And this doesn’t even include the market for hemp alone, which can be grown for construction, textiles, clothing, food, paper, bioplastics, insulation and biofuel.
And so the hemp market doesn’t rely on a selective niche of consumers that use its product for recreational purposes only (such as wine drinkers and cannabis users). Just about everyone could benefit from hemp in one way or another.
Also, unlike wine grapes which take several months to grow and several months to ferment before they ever become drinkable wine, hemp plants can mature in just a few months.
But, say, a commercial vineyard in a place like the Sonoma Valley wants to reserve a few acres of its property for growing hemp. Does the growing of either crop affect the other’s final product?
A Wine Spectator article titled “Can Cannabis and Wine Coexist?” tells how the drift of fungicides (used by many California winemakers to prevent mildew) have been known to render a cannabis harvest unsaleable when the crop is tested for regulation. And one can speculate the same would apply to hemp plants, especially if they’re used for CBD products.
The opposite occurs, too. “On the flip side, cannabis can release organic compounds called terpenes,” the article’s author Aaron Romano writers, “one of which is eucalyptol, known for tainting the flavor of grapes.” It should be known that hemp plants also have terpenes.
Corey Beck, CEO of Francis Ford Coppola Winery and former president of the Sonoma County Vintners, was quoted in the article, saying, “If cannabis can co-exist with the right regulations, and not be intrusive to our neighbors, then it should be available to a farmer who needs to put food on the table for their family.” He added that the wine industry is changing because of consumers drinking less and, therefore, wineries growing few grapes.
“I’m not suggesting the trend is here to stay, but if you are a grapegrower and can’t find a buyer in the short term, your choice in agricultural crops which provide a return such as grapes are limited.”
When you tell Seattle residents you moved to Seattle from Austin, you generally get two very different follow-up questions, depending on the person: One is, “What tech company do you work for that brought you here?” (It’s a tech hub very much like Austin, with Amazon having the largest presence in the city.) The other is, “Did you move here for the legal weed?”
The latter is the most ubiquitous response, I’ll be honest, because Washington was among the first states (with Colorado) to legalize cannabis for recreational use. This was in 2012, 14 years after the state first legalized medical marijuana. And the strange thing is, after having lived here a year, going to a dispensary is no more exciting than buying a bottle of wine at the grocery store. I’ve heard some people stopping by “the weed store: while running errands after work or before their weekend grocery run.
And while legal cannabis is an everyday part of life here, one might be shocked to learn that it took the state much longer to come around to hemp. The state had no problem breaking federal laws when it legalized cannabis eight years ago; and it turned out very lucrative: In 2018 alone, the state’s total retail sales of cannabis hit $1 billion, when the state collected $362 million in cannabis excise tax in the 2018 fiscal year; then in 2019, total retail sales hit $1.1 billion, with $387.6 million in excise tax. Washington’s cannabis market was projected to hit $2.1 billion in 2020.
The Green Rush of the 21st Century boomed with WA, & CO to join CA in allowing recreational marijuana in 2012.
But yet the state waited until the 2014 farm bill to pass legislation to allow for the planting of some 180 acres of hemp in 2017, and this was all under the umbrella of the Industrial Hemp Research Pilot program, which allowed for only the licensed “research”of hemp in the state.
Finally, earlier this year, almost two full years since the 2018 farm bill was passed, which legalized the cultivation and selling of hemp at the federal level, Washington state repealed and replaced its pilot program with one that allowed for people in the state to become fully licensed to grow hemp.
Of course this approach to regulating the state’s hemp industry likely stems from the nature of the national hemp industry, the market for which is not limited to a single state and up to state laws like cannabis. In other words, a hemp producer in Washington doesn’t have to rely on consumers solely within the state; now that hemp is legal federally, and no longer a Schedule I drug, the producer can ship its product all over the country regardless of where it’s grown.
However, if the Washington state hemp growers want a piece of the hemp-derived CBD consumer products market in the U.S., which is predicted to be worth anywhere from $6 billion to $7 billion in the year 2025, then Washington state will have to catch up to the other states that are taking a bigger market share, ones like Kentucky, Montana, Colorado and North Carolina that are producing and selling much more hemp. They’ve been doing it longer and have better infrastructure and more efficient supply chains to successfully grow, market and sell this cash crop.
The state should make hemp a major priority much like it has cannabis, that is if its growers want to exploit the huge demand we’ve seen this year for smokable hemp, which Nielsen researchers say will likely total $70 to $80 million in 2020 and could likely grow five times that number by 2025.
Episode 9: Leann Hemenway I Cannabis Banking Product Manager with Herring Bank.
Leann discusses opportunities for growers in the Texas area states to bank with Herring Bank in this rough waters of finance and compliance surrounding the growing Hemp and Cannabis space in the United States. Merchant services are not always offered with Financial providers in the Hemp space so Leann tells us about how to work with them and their partnership with “KINDPAY” .
CLICK HERE TO LISTEN TO THE PODCAST
Herring Bank began banking Cannabis-Hemp related businesses in April of 2019, with the goal of building lasting relationships.
Innovative Hemp Building Operation began in Texas in 2008
Passion met opportunity for Gail Moran in early 2008 when an unlikely candidate for her project – hemp – came into play with an innovative building venture, launching the first US venture of its kind and paving the way for the future of the crop in this industry.
Born & raised in Trinidad, Gail always carried on her affinity for limewashed buildings, romanticizing the construction that stood the test of time and built its own character with it. As she built her career as a general contractor, she placed her focus on using these old world materials and architecture in her own work, falling in love in particular with Mexican inspired buildings 33 years ago when she came to Texas from upstate New York. In her quest to find materials to build an old hacienda-style structure with authentic limewash on the outside, she found a company out of Chicago called US Heritage who specialized in historic restorations and had an extensive knowledge about lime in the building process, which is unlike concrete at all. Being the right person in the right place at the right time the Chicago company proposed a project idea to Gail that they were wanting to launch and being open to their pitch and having the means she undertook the first hemp project led by them in the US.
The Chapel’s Hempcrete Structure coming together as it dries.
At that time other countries in Europe, Australia, and Canada had already embraced hemp as a building material and the US launch required a lot of training and direct help to get the project underway. A restoration company out of Massachusetts aided in guiding the team through the learning experience with all of the different building trades adapting to the new techniques of framing, production and even lack of specialized equipment available. The company out of the United Kingdom furnished the hemp, binder and lime, covering the shipping costs and support to help the project get underway. The team had to rely on the hand-mixed bucket method as their concrete sprayers and pumps couldn’t accommodate the density of this new material, dumping and tamping it into handmade plywood forms to create the 12” thick walls. Being smaller structures, they were able to successfully modify the workflow, however lacking the specialized equipment they had overseas kept them from being able on any larger scale projects and push the innovations to any larger companies. The other large factor that kept the team from gaining any momentum on the hemp project was the unfortunate timing of the market crash that year. With financial institutions not loaning money and businesses folding there was no capital in the market to push the use of hemp in the building industry and the momentum of the endeavor eventually folded to the times.
Gail Moran Pouring the Hempcrete/Lime Base into the Project circa 2008
While Gail and her team had complete confidence in hemp providing the depth and timeless look and quality she sought out, and got positive public response in the symposiums she conducted with it through her Hopewell Project, the idea ultimately had to be shelved as timing just was not on their side in the industry at the time of the project. As the personal recipient of her efforts, the hemp buildings that were constructed on her property in Montgomery, Texas by her all-woman team remain this day to be the first hemp buildings in the United States and remain educational opportunities for the material as it rises in popularity again in this region. In addition to its green properties and use of the shaft of the plant, the hemp in building provides phenomenal thermodynamic qualities, material strength, pest resistant, and eliminates drywall and insulation. Should the industry build and begin to gain the physical means to take on larger scale project, she stands by this material’s potential to bring a new façade to construction.
Gail Moran has proven to be a statement of innovation in both her field and indirectly with education and de-stigmatization in the hemp campaign, providing the means and support to use this versatile crop in yet another way as well as not standing down to seeking out other means to bring a more authentic look to construction. With the introduction to a natural product in building it begins a conversation in authenticity and more positive control over how we view and take on building the world around us, working with what we can produce in our own means beyond fabricating so much of it.
Constructed on her property in Montgomery, Texas by her all-woman team, Gail Moran and the Chapel remain to this day to be the first hemp buildings in the United States
Colman discusses the Hemp Industry nationally and some of the goals that the organization works on each week to work with Washington by fueling the growth of the Hemp Industry. Also how this year was essentially a ramp year for Texas Hemp producers and what we can anticipate for the Lone Star states first full year grow season in 2021. Also many legal challenges regarding the DEA and smokable hemp ban are also discussed. Overall, an informative episode of the Texas Hemp show with our states director.
This episode our guest is President at Texas Hemp Industries Association, Colman Hemphill. Colman is also CEO at Texagon Distribution · an Alternative & Holistic Health Service.
We have been growing ornamental landscaping plants since 1992 and started growing Hemp in April 2020.
Is hemp your primary crop? And what do you produce (pulp, CBD, textiles)?
No, hemp is not our primary crop. Riverside Hemp is currently growing hemp seedlings for indoor and outdoor farmers with a focus on CBD varieties.
Do you offer any specialty products you would like to talk about (organic body care, construction materials)?
We are not producing any specialty hemp products at this time, but we are researching all possible outlets.
Can you describe your growing/processing operation?
The growing processes at Riverside Hemp are organic methods and indoor greenhouses for the highest quality consumable CBD products.
What are your hopes or expectations for the future of hemp farming?
Our roots run deep in Texas Agriculture. We want to see additional avenues that will help our local ag families thrive.
How have the challenges you encounter every day helped you become a better farmer?
We have been growing for 28 years. You learn from your mistakes and you grow everything with a scientific and methodical approach. Look for the best varieties in your region and through trial and error you figure out what doesn’t work. The Hemp industry isn’t any different. Always set yourself up for success.
Has growing hemp presented any special challenges?
There haven’t been any unique challenges in growing our hemp seedlings, but there is always something to learn when producing a new crop.
Do you find hemp farming a more rewarding endeavor than your ornamental landscaping business?
It is not more or less rewarding than our ornamental plants for landscaping. It is definitely different. It is exciting and an honor to be making history with Texas.
What were the major steps involved in adding hemp farming to your operation?
The major step was updating greenhouses to be better suited for hemp plants, as well as additional security. We are also very strict on sanitation stations before entering to keep the most sterile environment for our plants.
Texas was not exempt from the hemp propaganda of the early 30’s and leave it to hemp historian and grower, Les Stark, to unearth the truths of one Rio Grande Valley man whose story was lost to the times, a pioneer in the crop lost too soon – the story of George Trout.
Recognizing the golden properties of the sandy loom soil of South Texas and that synergy of the Gulf current breezeway that spun into what had the potential to be the new Indus River Valley, Trout invested a great deal of his own money into a major grow operation and plans for a decortication plant outside Raymondville with campaigns to grow heavy and hard in the area once production began. While the potential of this new crop excited many farmers and citizens who shared Trout’s innovative views of the industry for the lone star state, it didn’t come without resistance.
At the foot of an agricultural and industrial revolution the naysayers – those buying into the widespread hysteria fabricated for it’s demise, born from the threats the mass potential of hemp was having on other industries – did everything in their power to put a cap on it’s growth and sweep the truths under the rug along with the individuals trailblazing it’s way and this absolutely included the endeavors of this Texas man.
The introduction of this quick-to-thrive cash crop was met by immediate demonization and media misrepresentation, pushing all of Trout’s endeavors into the flames with falsely reporting it as a mass marijuana growing operation. Mass resistance began mirroring the mass excitement Trout had worked so hard to build with not only his grow experiments but his conventions with other innovative minds in the use of this wonder crop. With the headlines quickly changing minds outside these circles, a gubernatorial-led ban on hemp immediately followed leading to Trout and other Texas growers having to destroy their crop under the new narcotics laws.
The history of 1930’s cannabis propaganda is nothing new but why do we not know George Trout by name? His identity seemed to quickly disappear with the crop itself and this is where Les Stark’s research into the life of this Texas pioneer has uncovered another plot within.
Underlying systemic issues were brought to light in the firsthand accounts Stark was able to cross reference uncovered news articles with. Alongside Trout’s $100k investment into his endeavors he also invested in educating immigrant and ethnic minority workers in the trade, an action that challenged the racism of the time and most likely aided as a catalyst in the demise of his investment. Personal accounts told much milder truths to what was reported in the media surrounding the seizure of the crop by Texas Rangers and sadly Trout died just a short time after that occurrence, on his way to plead his case to federal legislature and ironically on the same day the Marijuana Tax Act was put into effect, never having had his story truly told. His name briefly resurrected in 1942, when hemp was revisited in Texas following the Japanese invasion of the Philippines – the US’s overseas supply house – but still not to the level of recognition that his efforts deserved in Texas history.
Les Stark pieced together the past to tell George Trout’s story for the future – the future of the industry he began nurturing far before it’s time to shine and as we embark on this new generation of growth he reminds us to take this account and learn from it, embrace the truths and draw out the same visions that this pioneer brought to light nearly 100 years ago. Take the time to further honor George Trout as he planted the first seeds for this state’s hemp efforts and thank Les Stark for his in not letting this story fade into the historical misrepresentation of this crop.
Smokable Hemp Ban in Texas, Temporary Injunction Granted – Win for Texas Manufacturers, Processors & Retailers and this weeks show we featured two of the States attorneys that are leading the charge to keep smokable Hemp here in Texas for retailers, growers,processors and of course consumers. Chelsie Spenceris a cannabis and hemp attorney. She is a founding member of Ritter Spencer PLLC. Chelsie practices in the areas of medical marijuana and hemp and represents clients across those industries for their business law and compliance needs.
Lisa Pittman – Lisa is Co-chair of the Cannabis Business Law practice. A leader and authority in the cannabis industry, which includes state legal marijuana and federally legal hemp, Lisa was recently appointed to be a Nonresident Fellow at Rice University’s Baker Institute for Public Policy as a member of the Drug Policy Program. Lisa also was appointed to the Texas Department of Agriculture Industrial Hemp Advisory Council, a role that provides her insight and influence on the regulations for the Texas hemp program, with the goal of propelling Texas to be the preeminent producer of hemp in the United States.
On September 17, 2020, Travis County Judge Lora Livingston ruled on a request for temporary injunction in a lawsuit filed by manufacturers and retailers of smokable hemp products in Texas. The injunction sought to prevent the State from enforcing its new regulations banning the manufacture, processing, distribution, and retail sale of hemp for smoking. The temporary injunction was partially granted, in that smokable hemp product businesses may carry on without facing penalties or fines under the status quo as it existed prior to the August 2nd effective date of the new rule – at least until the final trial on the merits set for February 1, 2021.Grinded weed shaped as Texas and a joint.(series)
Interview of Texas Agriculture Commissioner Sid Miller
By Lisa L. Pittman, Texas Hemp Advisory Council Member
THR: What impact does the first Texas hemp harvest have on future grow operations in the Lone Star State?
SM: Well, where we start is not necessarily where we are going to finish. We’ve got a lot of producers signed up, but it’s a lot slower start than we anticipated—one, there was a drop in price, which held a lot of the farmers back, then of course, the day we launched, on March 16th, is about simultaneously when COVID-19 took place; I think a lot of people were a little trepidatious about that, but we do have a lot of farmers signed up—Samplers, all the different licenses, we’ve got good action, whether it be lot permits or producers or processers, we are doing pretty good.
THR: How has the processing of those licenses and permits gone so far?
SM: The Legislature gave us a 60 day turnaround time to process the applications. I think we averaged about 10 days. Most of them went off without a hitch. There were just a few, a handful that didn’t quite fit our template for the application, like having 12 or 15 owners that wouldn’t fit on the application, so we had to hand-walk some of those through, a few other things, but for the most part I was very pleased with how smooth it went off.
THR: Especially with your employees working from home, right?
SM: Yeah, we changed and working from home, of course, we had zero staff and zero money to get the program up and running, which was a huge challenge. The Legislature didn’t give us any appropriations or any FTEs to start the program. Now we have some funds coming in from the sale of licenses, which we can use to back up our personnel and get some of that allotted time paid, but starting with nothing and doing everything is tough, but we managed.
THR: I bet, about what percentage would you say has been recovered or recouped so far?
SM: Well, probably zero. The Legislature allows us to raise $750,000, which we may do, but the Legislature gets the first quarter million—they get the first $250,000 and keep it. So, we are still working for free. What I am having to do is borrow from other programs and use personnel in hopes that we can pay that back once we get enough of the licenses sold, which we are getting pretty close to.
THR: Where do you see the opportunity for Texas growers headed compared to other states that started earlier?
SM: Well, we are behind a little bit. We are starting about four years late—a lot of the other states are operating on the 2014 Farm Bill—they don’t have to go through all the hoops and the sampling is different and a little less stringent and a little less oversight. Everyone has to be on the same page—the 2018 Farm Bill comes at the end of October. We are sort of blazing a trail. I think we are one of the first, if not the first, to actually implement the hemp program under the 2018 Farm Bill. We didn’t have any problem getting our plan and our Rules approved. They flew right through, so we are pretty proud of that, we are rocking and rolling and it’s running pretty smooth actually.
THR: Well, maybe in the long run we will be setup for success then under the 2018 Rules.
SM: I think so. We are going to be far ahead of the other states that haven’t switched to 2018. They will still have to rewrite their Rules and adapt and change, and all that. We don’t have to do that. We are up and running, so I feel good about that.
THR: Is there anything Texas can do to improve its laws to economically benefit retailers and growers during the next Session?
SM: You know, I’m not a big government guy, but right now, we’ve got zero field personnel and zero samplers. Since we don’t have any funding, I think the Legislature should address that. If we don’t do any inspections, if we get a complaint, I guess we will have to send someone out. I don’t have any personnel to do that, so the Legislature could probably improve the lack of oversight. We could probably do a better job if the Legislature would see fit to make those allocations.
THR: Do you have any comment on the ban on the manufacture and sale of smokable hemp?
SM:You know, I disagree with that. It’s a huge market. Banning Texas producers from selling and processing smokable hemp does nothing to curtail the sale of smokable hemp. Other states are going to be selling it and our people are going to be buying smokable hemp from out of state suppliers, so it really doesn’t slow it down any at all. It just puts our growers and processors at a disadvantage.
THR: Has the TDA noticed a decline in AG Markets/Commodities since COVID-19 started affecting our economy?
SM: We had some backlog in the meat industry where the virus broke out in the packing plants, and it shut down production which backed up a lot of the animals in the feedlots, and the poultry, the pork, but beef was the one that suffered the most. We have just about worked through all of that now—we are back up to 95 to 99% capacity, but we still have a lot of cattle that are backed up to feedlots that we’ve got to process. It’s still a depressed market there.
I sent a letter to President Trump and William Barr at the DOJ demanding a full investigation. Consumers are paying record high prices for beef and the farmers are receiving low record prices on their end. A farmer was losing $500.00 on a steer, and a packer was making $2500-$3000 on that same steer. They are looking into that. There is going to be a full investigation, which doesn’t affect the hemp business other than a lot of people that are growing hemp are also in the livestock business.
THR: How have President Trump’s recent direct payments to farmers impacted Texas so far, and how much has been sent?
SM: Well, we don’t have those numbers because it’s still ongoing. There’s still money left. They just recently extended the date on the application; I think until August 31st. So there will still be more funds going out. We don’t have a total on that. But it certainly helps. Farmers, you know, we really don’t want a handout. What we’d rather have are good markets and a free market system, but we are appreciative of that because we don’t want to go out of business and lose the family farm.
THR: Right. Have any official testing results been submitted yet on hemp crops and, if so, have any tested “hot”?
SM: Well, we’ve got a few samples, we’ve had 20 requests for sample manifests, and I think a dozen for transfer to actually move it off the farm [as of July 7, 2020]. I don’t believe any of those were “hot,” which is great news, but it’s still early—we have so far 921 producers, which is good. We only have 405 lot permits, so apparently these producers haven’t registered all their fields yet, planting is still going on, not all the fields are planted. But we will get there. We should have at least, if every farmer only has one field, we should have over 900 lot permits and many of them will have two, so we could have 1,500 to 10,000 lot permits, and we don’t right now—it’s a moving target—the permits are still coming in every day. I don’t have the acreage added up on that, but we will get that in the near future. We will have an acreage count.
THR:How much longer do the farmers have this summer to plant? When will be the next opportunity?
SM:We’ve got probably more acres in greenhouse operations than we do field operations, so those plant year-round—planting never stops—there’s not a season when you control the climate and the environment. This is a 90-day crop—a 60-day crop if you are just doing fiber. So we could still have the farmers planting, especially if they use transplants, or seedlings, which a lot of them do, actually planting up through the end of July, first of August… they’d still have time to make a crop.
THR: What can industry stakeholders do to better help the industry?
SM: Well, we just need to keep educating the public. You mentioned the smokable hemp, there’s really not any harm in that, but what people thought was “dope” or “weed” or the equivalent to, which it’s not, it doesn’t have the THC in it, so I think a public education program, we’ve still got some work to do there, but there’s been so many people helped by the CBD and CBG that the word is getting out that this is a very positive crop, it’s not a bunch of pot smokers bending the rules to grow marijuana, but it’s a legitimate crop that has many legitimate purposes, besides the oil, which is great, but the fiber has a lot of applications, too.
THR: Of those legitimate products, which products do you see Texas becoming a leader in? Is it fiber, or what about some other sustainable products as well?
SM: I think we’ll be all of the above…Texas is such a big state, a diverse state, we’ve got such a good growing climate, we’ve got a variety of soils, got a lot of good farmers here, basically have plenty of farmland, we’ve got a lot of greenhouses here, so I would say in five years, we’ll be if not the leader, one of the leaders, in the CBD CBG production and the fiber production.
THR: What needs to happen for the industrial supply chain to be built out in Texas?
SM: Well, we need more processors, we need buyers for that. The farmers, if you tell them they can grow a crop profitably, they will grow the world level with it—they will produce so much of it you can’t use it all, and that’s usually what drives the commodity prices down, so we need more processors for the fiber at this point.
THR: What can we do at the State to attract those businesses to come to Texas and invest and build those facilities and manufacturing plants?
SM: Basically, there’s not a lot left to do—we are already doing everything right already, that’s why so many other types of businesses now, including the hemp processors and distributors, will be coming to Texas. We have a very favorable business climate—no state income tax, low and predictable regulation, we are not a litigious state, we don’t just let the lawyers run crazy suing everybody, we’ve got a good labor force, everything you need for a successful business—that’s why so many people have moved here.
THR: What are some companion industries in Texas that people can apply their skills and resources toward hemp such as construction, technology, refining, medical?
SM: Well, that’s yet to be seen. We don’t really know what those industries are going to be or how they are going to take off. It depends upon the people conducting in those industries. It might be fiber for concrete, it may be fiber for cloth or material or paper or construction materials. At this point, we don’t know what we don’t know. But when we get up and running, we’ll find out.
THR:The hemp industry was soaring when the Farm Bill was signed, and Texas subsequently legalized hemp. Since then, wholesale prices have plummeted, and many are still trying to sell their 2019 crop. Now, 2020 crops from more states are coming online. Apart from having a buyer before you plant a seed, what advice do you have for people getting into this industry?
SM: Well, the first thing I would recommend to somebody that’s wanting to get into this industry, is go to the Texas Department of Agriculture’s website (texasagriculture.gov), I’ve got two very informative videos there—one is about getting into the hemp business, what you need to know, how you need to do it, what are the pitfalls, what are you up against. And then there’s a second video with a little more intel that we require farmers and processors to watch before they get a license. So at least watch the first one, if you’re thinking about getting into hemp, and then if you still want to get into hemp, watch the second one. If you still don’t have your questions answered, I have about 13 pages posted of frequently asked questions about the hemp industry and I think we have just about covered everything. All that information is available at your fingertips, 24 hours a day, seven days a week, 365 days a year.
Lisa Pittman for THR: Very good, thank you, Commissioner. Do you have any other last words?
SM: This is going to be a good industry. It’s been interesting to set up a new industry that we are on the ground floor of in Texas, and we’re helping to shape and mold that, and we just try to get as much input as we can—that’s why I have my own personal (it’s not state-mandated) Hemp Advisory Council, which I’m thankful that you serve on that, and you’ve been in on those meetings and I appreciate the direction and the input from all of the members of that which represents a big cross-section of the industry—whether it be grower, processor, or a testing lab, or transportation or law enforcement, we have someone from just about all of those areas that the hemp industry touches on that Council—we’ve got every aspect of the industry represented, so that’s been very helpful.
THR: Well I sure have appreciated serving on it, and I look forward to our next meeting.
What we Know & What we’ve learned. Growing Awareness with Law Enforcement
As the legalization of cannabis continues to take shape in the state of Texas, licensed growers are slowly finding holes within the system where further educational opportunities can be implemented, and often times it comes in the package of trial and error. Grassroots initiatives are moving in to bridge the gap and bring a wider spread awareness in response and the greater independent industry is recognizing that they only way to combat these growing issues is through transparency of sharing their stories and coming together in the wake of positive change to keep this forward growth moving.
A recent case currently under litigation in North Texas has brought to light some room to educate both law enforcement and growers & transportation services to be cognizant of the laws and licensing put in place to run legal operations and avoid unnecessary conflict due to unpreparedness, especially going into the first harvest season here in the state.
Red River Management Group wants to take their recent experience and share it with the public to cultivate a conversation around both the awareness and changing the perspective of grow operations & transport as this long stigmatized crop becomes more commonplace in interstate transport. The group is a hemp farm just north of Dallas in Bell, TX that provides starts, premium biomass and flowers to Texans, partnering with a curated network of premium partners in the hemp industry to insure dependability management in mitigating any risk involved in the operation. This recent incident, however, spurred the need for their own mitigation when their transport that was in full legal parameters was illegally seized and destroyed despite presentation of their licensed permits to manifest the hemp plants and product for transportation. Ben Von Kennel, CFO of Red River, was directly involved in the incident and wanted to share his case with Texas Hemp Reporter to peacefully encourage education for law enforcement on these issues as well as growers and transportation services in their preparedness and full knowledge of their rights and laws to present to their case should further events like this arise.
One of Red River’s clients required a very specific genetic match for their order and this request could only be filled by one of their partners in Colorado. After flying into Denver, picking up the product and starting the drive back to Texas, Ben was pulled over in Dumas, TX for a minor traffic infraction just before reaching his stopping point for the night. Already a proponent for preparedness – something he advocates to all levels of the hemp operation – he had what he calls his “pull over package” on hand and presented to the officer. This contained every piece of legal documentation and license involved in both their business and this specific order – producers license, handlers license, nursery license, bill of lading, COAs, shipping manifests and invoices – in addition to a negative COVID-19 test just to cover all bases of comfort in these times. Despite this extensive package of documents and his full cooperation on all parts, his delivery of over 1,000 plants and CBD flower were confiscated as he was released to his hotel for the night awaiting his appeal to have all of the paperwork verified and reclaim his property the next day. Upon returning to the Moore City Sheriff’s office to what he expected to be a rectification of the situation, he learned that all of the seized assets were already destroyed for testing.
What was ultimately lost in that shipment was of much more value and further reason to broaden the education on the full spectrum of all the cannabis industry provides. The specific genetics those plants carried was a CBG strain methodically created for ovarian cancer research that their client was undertaking and what resulted in, financially, an $80k loss but obviously much more in what the potential this plant has for the greater evolution. In addition to seeking financial reimbursement, Ben von Kennel just wants to “move forward hand in hand, arm in arm with law enforcement so this doesn’t happen to anybody else, “ and raise awareness that even though we are making strides in bringing this crop and it’s benefits to Texas, we still have a long way to go to educate the public as well as the industry itself.
Awareness lessens assumption and many grow operations are taking the initiative to invite local law enforcement to their farms to introduce to them firsthand what they do and how they legally do it to help aid the flow of the entire process. Adrian Garcia of Garcia Brothers Organics in Big Spring, TX took this proactive approach and sent out a letters & invitations to his local law enforcement to have them come out to their farm and see their licenses and learn about the process firsthand. While Texas battles an added level of conservationism on top of the long-standing stigma against cannabis itself, these fully transparent educational experiences still aren’t always immediately embraced, but the conversation is started and that seed is planted in the operation of widespread awareness. Garcia even experienced an additional benefit to his efforts when his local PD and sheriff’s department extended their own offer to support him with additional security measures should he need it when his crop began to flower. This extension of aid on both sides of the matter is what will change the course of the approach of how this crop is handled going forward.
Red River hopes to join forces further with the TDA to help advocate education “the more people are informed, the more you are ahead of it, the more you are out there, the less a situation like this will happen again.” In addition to the hopes that additional hemp programs will be implemented to equip law enforcement with what they need, Red River is adding in more pathways in their own day-to-day measures to ease the process of providing any and all legal documentation they can by investing in their own onsite testing machine in their greenhouse.
The goal is no division, an all-inclusive legally run operation that will build this state’s commerce and provide so much more for Texans long term. Along the way we’re reminded that we must also nurture awareness and continued education and be open about it all to move forward and use this industry to its highest benefit to all.
Herring Bank began banking Cannabis-Hemp related businesses in April of 2019, with the goal of building lasting relationships.
Herring Bank is a privately-owned Bank, based in Amarillo Texas. The Bank opened in 1899 and has been owned by the same family since its inception.
Since 1899, Herring Bank has built all of its business on the platform of developing “Relationships for a Lifetime.”
Prior to providing banking services to the cannabis-hemp industries, we spent a significant amount of time attending Cannabis related conferences, seminars and other events in order to learn as much as we could about the cannabis-hemp industry and their banking needs. We learned a lot about the challenges that businesses were facing in maintaining banking relationships and services, as well as, the costs the industry was incurring for their banking needs. Herring Bank realized that this industry was in desperate need for basic banking services.
One of the most important things we do at Herring Bank and in banking the Cannabis-Hemp Industry is to know our customer. During the initial on-boarding of a Cannabis-Hemp related business we follow regulatory guidance by collecting information related to the business, business owners, and identify how they are related to the cannabis industry.
Starbuds Dispensary owner, Sher Joudeh, has been banking with Herring Bank since the bank started banking cannabis-hemp related businesses. According to Sher, “Access to banking with Herring Bank has been critical to the operation and expansion of our cannabis business. With the ease of online banking, bill pay, wire transfers and normal banking abilities, it has been revolutionary in our cash management and cash handling. Banking with Herring Bank has been great, their staff is helpful, and their customer service is impeccable.”
With the legalization of Cannabis-Hemp from farm to table in some fashion in more than two-thirds of the United States and minimal financial intuitions banking this industry, Herring Bank wanted to step up and help make a difference.
We identified there was a huge lack of banking opportunities and access to other financial services which poses both an economic threat and a public safety threat. Simply having a business checking account at Herring Bank helps these businesses put their cash into a bank where it is safe. These businesses can now pay their bills, taxes and employees with a check rather than cash. They also have the ability to use online banking, debit cards and originate wire transfers to pay vendors.
All in all, by opening our doors to this industry, we have helped make this industry safer for both the business and their staff.
*Herring Bank is a privately-owned Bank, based in Amarillo Texas. The Bank opened in 1899 and has been owned by the same family since its inception. Herring Bank is a community bank that with 12 branches in three states, (two in Altus Oklahoma, 1 in Colorado Springs, Colorado and 9 located in Texas.
