Marijuana |

‘This is farming like we’ve never done before.’ Illinois hemp farmers face risks with first planting of newly legal crop

Thousands of young hemp plants dance in the breeze as fans blow through a loft on Trent Lawrence’s organic produce farm. And once a day, they dance to Bob Marley.

“The plants have got to have a little tunes,” Lawrence said, bending down to an industrial Bluetooth speaker and turning up the volume.

Lawrence is babying the hemp plants, he’ll be the first to admit. But he has to.

The farmer in Tazewell County, southeast of Peoria, is one of about 475 Illinoisans who have received licenses to farm hemp since the state started accepting applications last month. Hemp, a cousin of the marijuana plant, is perhaps best known for its use in foods and fibers. But certain varieties of hemp produce cannabidiol, or CBD, the wildly popular cannabis compound that is being infused into everything from animal treats to teas and cosmetics.

CBD, which does not get users high, has been touted as a cure for stress, inflammation, insomnia, and any number of other ailments.

With demand for CBD growing faster than the plants themselves, Lawrence and other Illinois farmers are making big bets on hemp. If everything goes according to plan, Lawrence estimates he could make $100,000 per acre of CBD hemp. And it’s not just the potential profits. For corn and soybean farmers, hemp is also a means of diversifying away from the state’s two primary crops, the latter of which has been socked with tariffs.

But the risks loom large. Farmers haven’t grown hemp in Illinois in generations, and those doing it now are learning as they go.

“This is farming like we’ve never done before,” said Les Dart, who plans to plant 75 acres of grain hemp on his 3,700-acre farm in Oblong, Ill., a central Illinois community less than 20 miles from the Indiana state line. “We’ve been growing corn and soybeans like all of our neighbors around here for the past 70 years. … (We’ve had) nothing that is this kind of radically new. It’s definitely going to be risky for us.”

On top of it all is the rain, falling more days than not during planting season and breaking records throughout the state. Although many Illinois farmers had planned to try out hemp on the side, some have found conditions to be too wet to plant their usual crops, meaning they are relying on hemp much more than they wanted to in its first year.

Illinois started accepting applications for hemp growers and processors in May, less than a year after then-Gov. Bruce Rauner signed a bill legalizing industrial hemp cultivation in the state. In December, President Donald Trump followed suit nationally, signing a bill championed by Sen. Mitch McConnell, R-Ky. In addition to the about 475 licenses issued to farm hemp, as of Monday, the state had awarded 100 processing licenses.

When applying for a license to farm the crop, Illinois farmers are asked to specify whether they’re interested in growing hemp that can will be used for fiber in textiles, a variety that generates grains for for food, or a CBD-specific strain of hemp. Their selection isn’t binding; in fact, farmers have the option of checking all three boxes. But it’s clear which form of hemp farming is the most popular. The farmers licensed to grow the crop are nearly five times more interested in growing it for CBD than they are in growing it for food or fiber purposes.

Farming hemp for CBD purposes is usually the most lucrative option. Once CBD-specific strains of hemp are harvested, the plants’ flowers are dried and sold to processors, who extract the CBD and infuse it into products. The dried flower, which resembles a marijuana bud, can also be smoked like its illicit cousin. In other states, those dried flowers have brought in between $25 and $200 per pound, according to a 2018 report from Hemp Industry Daily.

To get started this year, local farmers bought hemp seed from growers in states such as Colorado, Oregon and North Carolina, and they don’t know yet how the plants will fare in Illinois’ soil and climate.

The deer could eat them, the pests could eat them. Plus, growing CBD-specific varieties of hemp is downright tricky. CBD hemp reacts to stress by producing THC, the psychoactive cannabis compound that gets users high. If the plants “run hot,” as farmers say, and contain more than CBD’s legal limit of 0.3% THC, they must be destroyed.

Despite hemp’s finicky needs, farmers like Lawrence are depending on this year’s crop.

On a recent afternoon when the elusive sun was shining, Lawrence’s wife, son and an employee bent toward the soil on his organic farm, working to get rhubarb starts in the ground. His 4-year-old daughter Gabi helped too, mud from the wet ground caked on her arms and legs, wrangling chickens that are cute until they start pecking at the produce.

Of course, this year there are fewer veggies for the chickens to peck. The lettuce didn’t get planted. Neither did the majority of the cabbage, broccoli or any of the 10,000 plants that became root-bound in their pots and died while Lawrence waited for the ground to dry. He’s looking to hemp to recoup some of that loss.

“Just to pull out of the red this year, we’re very dependent on it,” Lawrence said. At one point this spring, half of his 26-acre farm was underwater. “We lost all our spring and summer crops.”

Lawrence started the hemp plants in either his greenhouse or loft, and will plant them outside when they’re stronger, giving his fields time to dry out. In his scorching greenhouse, Lawrence pointed at seedlings just barely poking out of the dirt. They occupy shelf space freed up by the vegetables that perished.

“This was vegetables we had to feed to the chickens,” he said. “Now it’s cannabis.”

Not everyone is farming hemp for CBD.

Rebecca Dwyer, a 23-year-old student in agricultural business, is planting hemp that will be raised for fiber on five acres of her family’s roughly 1,500-acre row crop farm in Woodford County, northeast of Peoria. She knows the hemp operation likely won’t make money this year, or even in the next five.

“I’m looking in the long term, where I think the market is going to go, where I think the value is in our farm,” she said. “It’s looking at it from that perspective that makes me see the value in hemp potentially in the future.”

Soybean exports from Illinois — the nation’s No. 1 producer of the legume — dropped by half last year after China essentially stopped buying in response to Trump’s trade tariffs. A federal aid package helped keep farmers afloat, but now there’s uncertainty surrounding possible tariffs on Mexico, the top importer of U.S. corn. Dwyer and other farmers are looking to hemp to keep history from repeating itself.

The type of hemp Dwyer is farming can be used to make rope, clothing, shoes, bioplastics and more. Maybe one day she’ll sell to Levi’s or Patagonia, brands with hemp fiber clothing lines. But the market is still developing. Although Illinois mills turned hemp into rope during World War II, no one in the state currently processes hemp for fiber. But plans are in the works.

Many of those planning to process hemp are still sorting out which variety of the crop to take, what equipment to buy and where to set up shop. For all farmers are pegging on the hot CBD market, few have buyers lined up for their products.

“We’ve never sold it here,” said Chad Wallace, who is planting a little more than 3 acres of CBD hemp on his produce farm about 30 minutes west of Springfield. “Everything’s uncertain and everybody is going to be kind of in the same boat.”

Wallace is hedging his bets this first year as he learns to grow the crop. The roughly 7,000 CBD plants he wants to get in the ground will be in addition to all his other vegetables. Farming hemp for CBD is much different than farming hemp for fiber or grain. From planting to harvesting, hemp that is raised for CBD must be tended to manually, while hemp raised for grain and fiber can be farmed with the same equipment that is used with other crops.

The plants have added hours of work for the 50-year-old farmer, and on most nights, he’s lucky to be in bed before 2:30 a.m. But it could be worth it — there’s more money in hemp being raised for CBD than in vegetables.

“The vegetable life is a very hard life. Not that hemp is easier, but if I could replace a portion of what I’m doing, that would be great to free me up to spend more time with family things,” he said.

It’s hard to predict what CBD will be selling for come harvest time this fall, said Erica Stark, executive director of the National Hemp Association. Demand is increasing, but so are the number of farmers producing it around the country.

Prices for hemp flower vary based on CBD content, Stark said. Most farmers can expect to get $45,000 to $60,000 per acre.

“I don’t think there is anything that can compare with the potential profit for a CBD crop,” Stark said. “But it’s just important that farmers are aware there is a significant amount of risk.”

Growing CBD is comparable to growing heirloom tomatoes, said Rachel Berry, CEO of the Illinois Hemp Growers Association. Other farmers have compared it to growing Christmas trees or some other crop, but to Berry, who farms heirloom vegetables, it’s tomatoes.

There’s weed control to contend with, plus insects and deer. The soil needs to be properly drained, and right now, the biggest concern is the weather. One aspect that doesn’t worry Berry is who she’ll find to buy the 4 acres of CBD hemp she is planting on her homestead in Princeton, Ill.

“It’s not like the need for CBD is going to go away,” she said.

In fact, it’s only expected to increase. Chicago-based Brightfield Group estimates the CBD industry could reach $22 billion by 2022, up from $627 million last year. CBD farmers will likely have no trouble finding buyers when the time comes, said managing director Bethany Gomez.

One company that’s already looking for CBD to process is Revolution Enterprises, a multistate marijuana company with a cultivation facility just several miles down the flat country road from Lawrence’s farm near Delavan.

The cannabis company wants in on the all sides of the hemp market. Earlier this month, it acquired a CBD pet product company. It’s also licensed to grow about 10 acres of hemp in Delavan, and plans to spend roughly $10 million on hemp processing equipment.

Operating in the cannabis industry reduces some of the risks of getting into hemp, said Kevin Pilarski, chief commercial officer and head of Revolution’s hemp operations. Hemp plants are grown and compounds extracted using similar processes. If the hemp markets went bust, the processing equipment — purchased with capital raised through the company’s cannabis operations — could be used with marijuana.

Outside of Revolution’s marijuana cultivation facility, two dozen or so hemp plants stand strong against the breeze blowing in off the unplanted fields that surround it. If the plants survive, they’ll be used as mothers, with clones clipped off their branches and propagated. This first year is a test run for Revolution’s hemp business, Pilarski said, as it is for all farmers trying their hand at the crop.

“If everything goes right, in three or four weeks they’ll be yay high,” Pilarski said, holding his hand at waist height over a plant. “We’ll see which of them is the hardiest.”

amarotti@chicagotribune.com

Twitter @AllyMarotti