Test market for industrial hemp

Hawaii has taken an important step in its agricultural diversification by supporting a serious investigation of hemp as a potential cash crop for the state.

The pathway forward, if there is to be one, remains uncertain — not unusual at this embryonic stage of any new agricultural venture. The state’s role, then, should be one of oversight and support, allowing the private entrepreneurs to take the lead, determining which of this versatile plant’s potential products could yield a good return on investment.

There are, of course, reasons why this crop has not been a go-to for many decades.

Hemp, which is a variant of the same species producing marijuana, is a controlled substance under federal law. Previous experiments at cultivation have been for limited research purposes only, starting almost two decades ago.

In the past few weeks, Hawaii became one of 15 states that now have Drug Enforcement Agency clearance to grow hemp under the supervision of their respective agriculture departments.

In addition, the state Department of Agriculture has just adopted rules to license hemp commercial farming, with licensing fees to help fund the program of state monitoring and supervision. That oversight is necessary to ensure that the crops grown do not produce high levels of tetrahydrocannibinol (THC), the component in cannabis plants that produces the marijuana high.

The hemp variant typically has low THC levels but higher amounts of cannabidiol (CBD), a compound that is not psychoactive but has anti-inflammatory and pain-killing effects, among other chemical properties, according to the National Institutes of Health. CBD oil is considered a high-value byproduct in the fledgling medical marijuana field.

This is one potential product of hemp that has drawn the attention of state agriculture officials here, given that its price can offset the elevated costs of crop production in Hawaii.

Whether or not this or any hemp product pencils out, in fact, will depend on the farmers developing a business plan that carries through to production. It’s too soon to make any predictions of success or failure until the next step plays out: a repository of seed for the farmers to begin cultivation.

The state has hired three contractors, for $75,000 each, to produce Hawaii-adapted seed from starter stock imported from the mainland. Once that’s done, farmers can decide whether a buyer exists for their end product, apply for licenses and start growing.

That may not be simple. Whether the target yield is CBD oil, food or beauty products, cattle feed, fiber used in fabric or building materials, or any of the other established hemp units, the processing plants will take a lot of front-end capital. That’s something farmers generally don’t have.

There is potential for them to form a hui and develop a shared processing facility; if a well-thought-out plan is presented to officials, the state should consider making lower-cost loans accessible.

But more likely, this enterprise would benefit from a partner with its own purchasing power. It could be a large agricultural entity such as Alexander &Baldwin Inc., which has been exploring crops for cultivation on Maui, now that the sugar plantation era has ended.

A&B recently announced a plan to test-cultivate pongamia, an energy crop that yields an oil that can be processed as biofuel. Hemp could be another avenue to explore. To cite one attribute, the plant is drought-tolerant — no small consideration in a place with concerns about its water supply.

That is a decision point where the farming enterprise will arrive some time later. Now it’s time to mark, with cautious optimism, that the DOA is working at building the long-promised diversified agriculture Hawaii needs. Hemp should get a fair chance at becoming part of that future.