Since Hemp was first legalized in 2019 Texas, it has been thriving as a hub for the prosperous hemp industry. The cannabis industry has grown dramatically in recent years in response to expanding legalization. Texas has had its share of leaps and bounds over the past few years as the Lone Star State embraces the potential of hemp cultivation.
There have been many challenges (and solutions) faced by those trying to maneuver the hemp market that either propel or discourage them from moving forward. Some of those hurdles include having to navigate through the tangled web of complex rules and requirements, excessive fees, marketing censorship, and even regulatory compliance issues, just to name a few.
The hemp market is a dynamic industry influenced by factors ranging from global demand to bad weather conditions. Most farmers are faced with the uncertainty of the market that discourages them from moving forward, yet misconceptions about hemp still persist, leading to a lack of awareness and education.
AUSTIN,TEXAS, USA –
It’s important in any industry to arm yourself with as much knowledge as possible to face regulatory changes that affect the community, farmers, advocacy groups, and businesses which can lead to a more streamlined approach to concerns. Submerse yourself in the who, what, when, and how of the industry to stay up to date with current rules and regulations that allow for the exploration of diversification strategies. Bridging the educational gap is crucial for dispelling industry myths and also helps to raise awareness of the diverse uses and benefits of hemp. This helps to build resilience in the face of a constantly changing market and helps overcome misconceptions that lead to the development of innovative solutions. Advocates must engage themselves in community outreach programs, workshops, and even public events to better inform consumers and policymakers about the uses of hemp and its benefits. If these events are not readily available in your community, you can consider hosting your own Hemp 101 forum or workshop and start from there. You can also inform advocates about the latest technology trends that optimize farming operations and help match researchers with industry players to help form collaborations to support the continued growth and improvement of the industry.
As growth occurs, challenges arise, and coming up with new and innovative ideas will be vital for continued growth. When industry partners work together, bonds are reinforced and growth occurs. Texas continues to shape its identity in the hemp industry and implementing innovative solutions essential to sustaining its growth for years to come. By working together, staying well informed, and adapting to the evolving landscape, Texas can become a world leader in a thriving hemp market.
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.
