Hemp production sees steady growth in Canada

Canada’s hemp growers grew a record-large crop in 2013, and while acreage to the multi-use crop is still very small compared to most other options, further increases are expected next year.

The longer-term outlook may see it even compete with canola at some point in the future, from where one industry promoter sits.

“We had an excellent hemp crop this year,” said Kim Shukla of the Canadian Hemp Trade Alliance, based at Steinbach, Man. Canadian farmers grew a record 66,700 acres of hemp in 2013, which compares with about 54,000 acres the previous year, according to Health Canada data.

Yields were good, with no challenges reported during the growing period, said Shukla.

The biggest acreage increase was in Saskatchewan, where the bulk of Canada’s hemp crop is grown, with Alberta and Manitoba also seeing increases, she said. “The economic return has been great for producers,” she said, noting the acreage increases were the result of both new growers and existing producers expanding their acres.

Coming out of the CHTA’s annual meeting last week in Saskatoon, the industry appears to anticipate another acreage increase in 2014, said Shukla, the association’s executive director since 2009.

In addition to the interest from farmers, the processors can currently sell every pound that enters the marketplace. “We’re definitely nowhere near being long on product,” she said.

Most of the current processing capacity in Canada is for hemp seed, but there are also developments to increase hemp fibre processing capacity.

Due to industrial hemp’s association with its cousin marijuana, farmers need to be licensed through Health Canada and pass a criminal record check in order to grow the crop. Testing is also required to confirm the plants’ level of THC, the psychoactive ingredient in marijuana, is below the allowable 0.3 per cent.

The Red Tape Reduction Commission, conducted by the federal government in 2011, pointed to hemp three times as an industry where improvements could be made. Consultations took place last month and the industry has until Dec. 20 to submit proposals for changes.

Impediments

The hemp sector, Shukla said, is ultimately looking for Canada’s hemp production and regulation to be put under the auspices of Agriculture and Agri-Food Canada, rather than Health Canada.

Industrial hemp was legalized for commercial growth in Canada in 1998, and regulations on growing the crop were stringent in the beginning due to the uncertainty over what to expect, she said.

In subsequent years, there have been no issues with protecting the public, which would be the domain of Health Canada.

On top of the licensing process, other impediments limiting production include the fact that GPS co-ordinates for every piece of land growing hemp must be registered with Health Canada.

“If there is a knoll, or a river, or a fence that separates one field from the other, that field needs to be registered separately,” said Shukla.

Applications with Health Canada also need to be made in the winter, while planting decisions are often not finalized until spring.

With AAFC overseeing hemp, there would also be no sampling for THC at the field level, with the only testing to done at the foundation seed level and then again by processors selling for human consumption, Shukla said.

If hemp production remains under the control of Health Canada, she doesn’t anticipate any changes to regulations until 2016. “If it is fast-tracked, we would expect it could happen much sooner,” with some sense of direction likely this spring, she said.

A loosening of the regulations surrounding hemp production would open the door for a significant acreage increase. “It could be a canola,” said Shukla.

“The grounds we have for making that bold statement” include the fact that hemp can be grown across Western Canada and has multiple applications for more markets than canola, such as textiles and food uses, she said.

– Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.

Related story:
Genome shows path from hempseed to weed, Oct. 20, 2011