Why isn’t Hemp Everywhere Now that it’s Legal?


Why Isn’t Hemp Everywhere Now that it’s Legal?

Hemp can be used for furniture, paper, clothing, rope, building material, birdseed, and even ice cream, so why isn’t it?

Before 1800 hemp farming was very popular because hemp fiber was used for common textiles and paper goods, but by the 20th century, it was gone. Hemp lost any remaining popularity in the 1930s after the popularization of cheaper, more comfortable materials like cotton and successful smear campaigns from the paper industry.

In the 1930s, the petrochemical company Dupont was responsible for a sulfur-based process of turning wood fiber into usable paper. Around the same time, William Randolph Hearst owned a nationwide newspaper that reached 20 million Americans in 18 major cities. Hearst was heavily invested in thousands of acres of timberland to make wood pulp for the newspaper industry. Neither Hearst nor Dupont wanted the competition from the high-quality hemp paper, it is quite possible they were working together. Hearst supplied wood and messaging for the newspaper while Dupont supplied chemicals to produce and preserve paper. They developed the tree paper industry while crushing the hemp industry. Through Hearst’s newspaper, he spread slander about hemp and marijuana.

In 1937 the Marihuana Tax Act made all cannabis illegal. By 1970 it became a schedule 1 drug under the Controlled Substances Act, which officially marked it as a substance with no acceptable medical or industrial use.

Since then, hemp has come a long way in the general public’s eyes, especially for things like CBD products. Former President Donald Trump signed the Farm Bill into law on December 20th of 2018, which included hemp, in title 10 “Horticulture.” Shortly after, the USDA began implementing programs related to the once outlawed substance. By February of 2019, the USDA began gathering information to set rules on “the commercial production of hemp.” It is now federally legal to buy, sell, and distribute any kind of hemp products, so why aren’t we seeing more of it outside of the cannabinoid (CBD) industry?

Let’s look at paper again. Hemp was used to make paper for 2,000 years until the 20th century, when wood pulp replaced cannabis and other long fibers. Why hasn’t it come back?

Hemp crops are usually ready to harvest after four months, making for a much more efficient growing period than its competition of trees like spruce, pines, fir, larch, hemlock, eucalyptus, aspen, and birch, which can range anywhere from 12-40 years to mature for harvest. Not only that, but hemp offers a much more compact growing space friendly to multiple regenerative farming techniques such as vertical farming, crop rotation, and cover cropping that help a farm’s soil management and sustainability.

Cellulose is the principal component of paper for its contribution of strength and durability. Trees contain thirty percent cellulose, while hemp plants contain up to eighty-five percent cellulose. Fewer chemicals are required to make hemp than tree paper, and after the paper is used, hemp paper can be recycled double the amount of times as wood paper.

Hemp does have indisputable competition when it comes to carbon credits, yet it offers the ability to sequester more carbon than most other agricultural crops. Trees are our largest source of mid-long-term carbon storage. Hemp is much better suited for paper production, especially once you consider the fewer chemicals, structural benefits, and recycling possibilities that it offers.

To compete with the traditional tree pulp paper industry, which produces 78 million tons of paper per year and directly employs nearly 375,000 people, the hemp industry (currently worth $5.66 billion in aggregate, as reported in 2020 by Global News Wire) would need to build out massive infrastructure and supply chains to produce hemp paper at scale to be cost-effective. Hemp producers are hesitant to commit to generating such high volumes of hemp without a firm purchasing commitment. On the other hand, hemp processors for paper are hesitant to commit to such large hemp purchasing volumes without a solid supply chain and established competition with large and entrenched tree paper manufacturers. Not only that but, the current paper processing infrastructure in place cannot simply take hemp as an input substitute for wood pulp. Due to its higher cellulose content and difference in fiber length, it would have to be retrofitted, which comes with a hefty price tag.

The good news is that the hemp industry is projected to grow, and its benefits are worth following through. These things can’t happen quickly, especially when competing with other established physical commodities. Due to the law and stigma around hemp, the simple, but the massive reason why we’re not seeing more industrial hemp market growth is the time it takes to curate enough infrastructure. Firms like PanXchange that bring forth industrial hemp benchmarks in consistent hemp analysis reports allow for price transparency and structure around this burgeoning industry, which we hope can expedite growth.

The hemp industry has more than a century to catch up on. Luckily, adopting ESG policies is increasingly becoming a necessity for a firm’s overall success. With current developing information and technology, industrial hemp will continue to become a more attractive, economical, and sustainable replacement for wood paper. Hemp does stand a chance to be our paper (among other things) once again, just not immediately.