Farmers Rushed Into Hemp. Now They Face a Glut.

[Yo_Mama_Been_Loggin]

CYNTHIANA, Ky.—Tony Ockerman, a fourth-generation farmer hoping to diversify his crops by adding hemp, said his first harvest this year turned out well after plenty of trial and error. But he is struggling in one key respect: finding buyers.

Hoping to capitalize on surging demand for cannabidiol, or CBD—a derivative of hemp or marijuana that proponents say has numerous medical benefits—Mr. Ockerman invested about $100,000 to grow 30 acres of the plant. Unlike some farmers who secured contracts with buyers ahead of the growing season, he rolled the dice.

“We’re just free-birding it, raising it and seeing what happens,” said Mr. Ockerman, 61 years old, who also grows hay and tobacco on an additional 520 acres in Chaplin, Ky., southeast of Louisville. “There’s just a lot of hemp out there. It’s overproduced.”

A rush of farmers seeking to grow hemp, which became legal to cultivate in the U.S. last year, is creating a glut, damping prices and leaving some farmers struggling to unload their product. It is among the growing pains in the nascent industry for hemp-derived products—a potentially lucrative market, but one beset by regulatory uncertainty, financing constraints and other challenges.

https://www.msn.com/en-us/news/us/farmers-rushed-into-hemp-now-they-face-a-glut/ar-BBXyf6z?li=BBnb7Kz

[SWBTATTReg]

1. What did they think? Obviously there was no serious efforts to determine the sheer...

amount of hemp being planted (if they even track, authorities might, when they allocate the licenses), but obviously the authorities are more concerned w/ the tax revenues being raised by hemp licenses than ensuring that their farmers wouldn't come to harm via too many of them trying to grow hemp (glutting the markets, in effect, wiping out the market in the long run). Nice planning, eh?

[marble falls]

2. The same kind of person who bought into the Emu/Ostrich game in the eighties.

[customerserviceguy]

3. What

"The pork of the future" was a scam?!! Anybody remember that line from a TV commercial?

With CBD being sold on nearly every commercial street corner in the United States, yeah, I'd say the market is saturated. It makes me wonder if CBD is the snake oil of 2019.

[marble falls]

4. CBD is a good thing, but it doesn't need a pharmaindusrial complex to make. But it does need some ..

sort of standards.

[customerserviceguy]

5. Oversupplied markets

always eventually shake out the providers of a good or service that underperform the best providers. I don't have any conditions that CBD is touted for, but by the time I do, there will probably be a stable market of quality products, competitively priced.

[Wellstone ruled]

6. True nature of American

agriculture,total lack of research into supply demand of a product. In the late Sixties there was a Sucker Story similiar to this in Southwestern Minnesota. Artichokes grown for world export,thousands of acres were planted,when harvest came in late August,those promised markets where non existent but a couple of Bull shit artist made a killing selling these suckers Seeds and specialize equipment to cultivate and harvest Artichokes.

If you drive the country roads in Lyon,Western Redwood,Pipestone County,you will still find Artichokes growing wild in the Ditch Lines. Memories of herd mentality of American Agra Business.

[Happy Hoosier]

7. We need a focus on industrial hemp.

I produces excellent paper and clothing fibers, and is much more environmentally friendly. We should be actively encouraging a shift away from wood pulp for paper and water thirsty cotton.

[silverweb]

8. Exactly.

There are many more uses for hemp besides extracting CBD oil. If there isn't already, there should be a hemp growers' association that seeks and helps develop markets for industrial hemp. It's a safe bet that established suppliers of other materials are well organized in efforts to exclude hemp from their markets, and they must be overcome.

[MuseRider]

10. We actually have thought about that.

We thought we might try part of the farm but I have to wait until my animals die off a little more before I can afford to get through another drought like 2018. Once this happens we might just do it. CBD is covered by a lot of things but industrial use, clothing and paper would be needed in much greater supply. We have an institute here that teaches farmers about it, it might be too much money or too hard for 2 older people to convert from brome to hemp.

[Quackers]

9. Who in their right mind would drop $100k without a contract or buyer place? nt

[matt819]

11. Maybe the price of hemp hearts will come down

It’s $18 per pound. I use it for my morning cereal and the muesli I make.

[Hoyt]

12. If he can survive -- while other farmers drop out -- he might eventually make a little.

The "Cobweb" economic theory is that as the price (or potential profits) increase, farmers increase production. The increased production forces the price down, unless demand picks up substantially. Farmers get out, which forces the price up. Etc., etc., etc.

That's one of the reasons farming (and similar industries) is so tough.




Haven't tried CBD oil. But when the joints hurt, I think about it. Bought some hemp shorts and a shirt a year or so ago. They are OK, but the shorts are always wrinkled and the shirt seems a bit hotter than cotton.