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Colorado’s plan to build a foundation for industrial hemp

Gov. Jared Polis has a bold plan to make Colorado a hub for industrial hemp production. But how do you create a hemp industry when you lack the knowledge and machinery to make it profitable?

Bales of hemp harvested last year on the Wright-Oakes farm near Hooper. The Sangre de Cristo mountain range rises above the valley in the distance. (John McEvoy Special to The Colorado Sun)
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“My name is Jared Polis and hemp — it’s everything.” 

This was the message Colorado’s governor used to sign off on an order declaring June 6–13 Hemp Week in the Centennial State, and he is staking his legacy on the often-maligned plant that had been illegal to grow in the U.S. for nearly 50 years. 

This is no surprise from Polis. In 2013, when he was serving in Congress, the Boulder native helped a lobbyist fly an American flag made from hemp grown in Colorado — which was illegal to grow in the U.S. at the time — over the U.S. Capitol on the Fourth of July. To kick off newly declared Hemp Week, Polis put an exclamation mark on his sustained efforts to champion cannabis and raised hemp-made American and Colorado flags over the state Capitol. 

The goal is clear: Polis wants his home state to be at the forefront of bringing the crop he believes can help farmers and stabilize the economy back to the U.S. 

“That means continuing the administration’s focus on the small, family farmer and a mutual focus on the environment and achieving 100% renewable energy by 2040,” said Ean Seeb, the governor’s special adviser on cannabis. 

This story first appeared in The Outsider, the premium outdoor newsletter by Jason Blevins. Become a Newsletters+ Member to get The Outsider at coloradosun.com/join. (Current members, click here to learn how to upgrade)

Even with fervent support of both the governor and do-good clothing company Patagonia, efforts to seed Colorado’s fertile San Luis Valley as an international hemp hub face roadblocks. The challenges facing efforts to revive manufacturing jobs across rural America are the same for hemp: the machinery and technical skill sets are lacking and the often-complicated production processes are much cheaper in far away lands. 

But there is a growing list of reasons to feel optimistic about the future of industrial hemp in Colorado. And topping that list is CBD.

The cannabidiol CBD, a non-psychoactive hemp extract, has become the darling of a booming wellness trend, showing up in sodas, tinctures, creams, dog treats and more. Cannabis and CBD data forecaster The Brightfield Group claims that hemp-derived CBD brought in $4.7 billion in U.S. sales in 2020 and predicts the market will soar to $16 billion by 2025. 

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But CBD is just the tip of the iceberg for hemp, which can and has been used for everything from auto chassis to textiles to paper (Polis’ business cards are printed on hemp stock). Research group Facts and Factors estimated the market for industrial hemp, including CBD, at $5 billion in 2019 and expects it to top $36 billion by 2026. 

It’s the industrial hemp uses other than CBD where the market really has room to grow. 

And that’s where the Polis administration sees the potential for an economic boom. It created the Colorado Hemp Advancement and Management Plan (CHAMP), making a commitment to implement large-scale initiatives including research, regulation and commitments to processing centers and economic bonuses for farmers committed to the new industry.

“Colorado is a clear national leader for industrial hemp, and the CHAMP report will serve as a key tool to further our leadership. We want Colorado to continue to be the best state for industrial hemp which will help our rural communities thrive,” Polis said when it was released in March.

Defining basic standards

There’s just one problem. As with most manufacturing, the U.S. no longer has the infrastructure or know-how to process industrial hemp into products, especially textiles that require fine fibers. Hemp and recreational marijuana are both cannabis and growing hemp, which contains only trace levels of psychoactive THC, have been illegal in the U.S. since the passage of the 1970 Controlled Substances Act, a victim of the crackdown on hippies’ recreational weed. 

That all changed, however, with the Farm Bills of 2014 and 2018, both championed by Polis, which allowed for hemp to be grown legally in the U.S. as long as its THC content is under 0.3%. High-potency recreational marijuana flower can contain 30% THC, while marijuana concentrates can push potency levels up to 90% THC. 

Shanan Wright adjusts the proprietary liquid fertilizer mixture used to grow hemp in the arid, high desert climate of the San Luis Valley on June 12, 2021. (John McEvoy, Special to The Colorado Sun.)

Those bills opened the floodgates for the CBD boom — since it is fairly easily extracted from the plant leaves — but other uses, many of which require processing hemp’s fibrous stalks, had no foothold. U.S. manufacturers have been using industrial hemp in products even when it was illegal to grow in the country, importing it mostly from China, which grows 70% of the world’s hemp and possesses the infrastructure necessary to make it a viable material.

“Hemp does not have big boy pants in the U.S.,” said Bill Althouse, a founder of the Colorado-based Fat Pig Society, a small hemp farm cooperative. “You need to know how to build a foundation before you can build an industry. And we don’t have that foundation.” 

Althouse, who who also sits on the Colorado Department of Agriculture Industrial Hemp Advisory Committee and Hemp Center of Excellence Steering Committee, points out that, beyond processing woes, U.S. hemp producers are still stuck in committee trying to agree on ASTM standards for hemp products . That means consumers have no idea if manufacturers’ claims about the quality and performance of hemp products is true.

“Right now, hemp is in a backwater with ASTM,” Althouse said. “And how do we replace a cotton T-shirt if we don’t even know what the standards are? If you want to play against cotton, you have to meet the standards. You hear a lot of woe-is-me talk from hemp people who feel like they are out to get us — but they don’t hate us because we are hemp. The problem is we have failed to define basic standards.”

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Those roadblocks have not deterred Polis, who has also been proactive about putting Colorado at the forefront of the recreational and medical marijuana industry in the U.S. In 2019 during the biannual Outdoor Retailer trade show in Denver, the perfect opportunity arose to make industrial hemp for apparel a reality in the state. Patagonia, which has been using Chinese hemp in its workwear collection since 2017, brought together a team to discuss the possibility of using American-grown hemp, and Seeb attended (his father, a Michigan-based retailer for the brand, tipped him off). 

The Polis administration had a clear message for Patagonia: If it wanted American hemp, the state of Colorado would do whatever it took to make it happen.

Hemp rates high as a sustainable crop: It needs less water than cotton; grows fast and dense, requiring less space for more profitable crops; requires few pesticides; and even works as a carbon dioxide sink, possibly mitigating the effects of climate change. 

So Patagonia, a certified B Corp, required by its articles of incorporation to put environmental and social good ahead of profits, was intent on using hemp since the crop is sustainable and the idea of reviving the U.S. hemp industry checked off all the boxes when it comes to its compassionate corporate goals — but the passion of the Polis administration took it by surprise.

“We just wanted folks to come together and start trading notes and business cards,” said Ed Aumen, who directed Patagonia’s workwear business at the time. “But Polis’ office said they were willing to find enough acres in the state to do a test plot for the upcoming season.”

Wright-Oakes Farm co-owner Dion Oakes (in skid loader) lifts a bag of hemp seeds up to co-owner Shanan Wright standing on the seed driller, which will plant uniformly spaced rows of seeds in the ground. (John McEvoy Special to The Colorado Sun)

Polis’ office connected Patagonia with Wright-Oakes Farms in the San Luis Valley for a 500-acre plot. The high, dry valley is the perfect place for hemp, which can survive with less water and at higher elevations than most crops, but the project faced the same brick wall as other industrial hemp initiatives in the U.S.: the facilities and knowledge to grow hemp simply does not exist here anymore. American farmers don’t have the ability to strip raw hemp down to the useful fibers, a process called decortication. They don’t even have the seeds to even grow hemp at a 7,500-foot elevation. 

Luckily, Patagonia’s Chinese hemp supplier, which had been at the Denver meeting, stepped in and provided the seeds (it turned out that the Chinese farm is at the same altitude as the San Luis Valley). The supplier also promised to provide expertise and even to send essential hemp harvesting machinery to Colorado. Patagonia would then send the processed U.S. hemp to China to manufacture into its workwear. Then COVID-19 hit.

“So he couldn’t ship the machinery,” said Aumen, who retired from Patagonia in June. “But somehow they located a decortication machine in Colorado. It’s bizarro to me why someone would even be sitting on something like that, but they had one. Soon we were Zooming back and forth and sending videos from the Chinese textile mill to the farmer in southern Colorado.” 

Polis even headed to Wright-Oakes farm, donning a cowboy hat as he personally checked on the crop. By harvest, Wright-Oakes Farms had 500 acres of hemp, which it stored in a shed while Patagonia sent samples to China to test in the machinery and process it into a fiber that can be spun into a yarn, which can then be crafted into Patagonia textiles. 

Close-up detail of hemp fibers in a rolled bale on the Wright-Oakes farm. (John McEvoy Special to The Colorado Sun)

While it has not set an exact date yet, Patagonia plans to begin selling workwear made with U.S. hemp in the next few years, possibly as soon as 2023 and is continuing to work with farmers in the San Luis Valley. Though still produced in China, it will be the first apparel made from U.S. hemp from the first legal industrial hemp growing operation in America.

“Patagonia realized the value of hemp as a textile years ago and the state will continue partnering with anyone who shares our goals,” Seeb said.

Six hemp manufacturing projects by 2022

Althouse was not particularly impressed, however. He saw the project as more of a move to make business people feel good than a real step forward for Colorado farmers. 

“You have to make hemp work for the farmer, not just the investor,” he says. “Fortune 500 companies can come up with wild ideas but they sometimes seem to be under the impression that farmers work for free.” 

And he sees little hope of the industry moving forward by shipping hemp to Asia. 

“There’s more processing that takes place in China beyond decortication,” he says. “It’s a really nasty chemical process to get the hemp fiber to work in apparel and that’s not allowed in the U.S. — for good reason.” 

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So, once again, hemp is running into the same problem that most efforts to revive American manufacturing encounter: the infrastructure is long gone and manufacturing is simply more cost efficient overseas. 

With its hemp management plan in hand and a proposal sent to the USDA, Polis’ team is making plans to shift the American manufacturing paradigm, however, at least when it comes to hemp. Seeb’s department has set in place a WIG, or a Wildly Important Goal, to increase new hemp processing capacity for industrial applications by supporting and expanding six projects in the state by June 30, 2022. 

“There is room for the hemp industry to mature by expanding the supply chain beyond CBD to include more processors of industrial hemp in Colorado, which will also create local jobs,” Seeb said. “The Polis administration seeks to support the maturity of the industrial hemp market by expanding the processing capacity for industrial hemp applications in Colorado, benefiting both farmers and processors through new economic opportunities.”

Shanan Wright seeds hemp on his Wright-Oakes farm near Hooper, on June 12, 2021. )John McEvoy Special to The Colorado Sun)

That type of infrastructure would mean brands like Patagonia would be able to not just grow their hemp but also spin it into yarn and craft all-American workwear in Colorado. As far as the on-the-ground details of the plan it sent the USDA due back in August, the state has yet to hear back and is not yet willing to discuss it. 

“It’s a progressive plan, the culmination of hundreds of hours of work from a dedicated team who shared the governor’s vision. We hope to have information to share in the future,” Seeb said. 

From the farmers’ perspective, any plan must include a guarantee that hemp will be profitable and sustainable over the long term. Big, sustainable ideas from brands may resonate with consumers and push for a better planet, but why should farmers, who are always in a perilous place trying to make a living off the land, commit to hemp — even if it’s better for the environment in many ways — if they can make more money with traditional crops? 

“If you want to see hemp in the ground, offer a guarantee that it pays more than wheat, corn or soy,” says Althouse, who also wants planners to get creative in solving problems like processing and look for ways to make use of parts of the plant like the lignin, a sticky, difficult-to-remove polymer that must be stripped from hemp fiber before it can be spun into yarn.

Seeb thinks that he and the Polis administration are building a business model for hemp, as well as envisioning it as a possible solution in the fight to reverse climate change. 

“The sky is the limit for hemp in Colorado,” Seeb said, “and we look forward to helping our agriculture community thrive today and for future generations. The governor has spoken openly as to the future of hemp in Colorado. And our CHAMP plan identified key deliverables. No one is immune to the economic impacts of climate change and drought that is ravaging the West and the Polis administration is taking steps to mitigate those impacts and prepare for the future.”

That’s what the governor made clear when he announced Hemp Week and waved his cannabis flags. Hemp is everything to his administration, and he is determined to make industrial hemp part of the solution to everything from climate change to pandemic recovery.


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