The struggles of the Mississippi Delta and Mississippi farmers are well documented. But relief may be on the horizon if the State of Mississippi is willing and able to build the infrastructure necessary to capture its share of an agricultural market that is expected to increase from $820 million this year to $22 billion in 2022. Yes, you read that correctly; there is an emerging agricultural industry that is expected to increase by more than 2,500 percent in three years – hemp.
Hemp is one the world’s oldest domesticated crops and is one variety of the cannabis plant. Marijuana, another variety of cannabis, is genetically distinct from hemp and contains the psychoactive cannabinoid tetrahydrocannabinol (THC) in quantities up to 25 percent. The presence of THC and more than 100 other cannabinoids in marijuana make it desirable for medicinal and other uses.
Hemp, on the other hand, contains non-intoxicating amounts of THC, typically less than percent, and is cultivated for industrial purposes to produce literally hundreds of products, including paper, rope, textiles, clothing, shoes, food, bioplastics, insulation, biofuel, and building materials.
Despite their different uses and genetic makeup, hemp is often wrongly associated with marijuana and has been considered illegal to grow since 1970 when it was added as a Schedule I drug to the Controlled Substances Act. Prior to becoming illegal, hemp was grown throughout America and was even cultivated by former presidents George Washington, James Madison and Thomas Jefferson. Hemp is regarded as one of the world’s most useful plants, yet it remains guilty by association and largely inaccessible as an agricultural commodity.
Hemp gained limited federal legal status through the 2014 Farm Bill, which allowed cultivators to grow industrial hemp containing less than 0.3 percent THC if the cultivators were registered through their states’ hemp research pilot program. Many states created such programs and reintroduced hemp as an industrial crop under strict agricultural regulations. The 2014 Farm Bill expired September 30, 2018, before Congress adopted the 2018 Farm Bill that could have extended or expanded the hemp pilot program.
The future of industrial hemp depends on what version of the 2018 Farm Bill Congress adopts, though there is considerable bipartisan support for provisions in the Senate’s version of the bill. Majority Leader Mitch McConnell introduced that version, which would fully legalize industrial hemp by removing it from the Controlled Substances list. Federal legalization allows hemp growers to access banking and crop insurance, too. Though the bill is in congressional limbo, Congress is likely to adopt language that will result in new opportunities for hemp cultivators.
When the 2018 Farm Bill passes Congress and is signed into law, Mississippi has a tremendous and unmatched regional advantage when it comes to hemp. Mississippi’s rich soil and focus on agricultural innovation can make Mississippi a leader in hemp cultivation. In addition, Mississippi’s interstate and waterway access could make the state the epicenter of exportation of processed hemp materials both throughout the United States and internationally.
And while hemp presents a tremendous opportunity for Mississippi farmers and Mississippi farming communities, as with many other products that are either manufactured or grown, the value in the supply chain is not in the making or growing. The real value in the supply chain is in the processing and development of new products. This is worth emphatically restating. The real value in the agricultural supply chain, especially as it relates to hemp, is in the processing of the plant and the development of new products.
This means keeping hemp processing in the state and not exporting raw product across the river. Hemp processing facilities, much like the cotton gins of old, are the key to this emerging market. Highly skilled engineers, scientists, botanists, and technicians will be needed to exploit hemp to its fullest production capabilities.
These jobs and these processes are extremely valuable and create far greater long-term value than simply growing the product. Local economic developers who capitalize and develop processing plants in their communities will reap economic benefits for their communities for decades to come.
Two of Mississippi’s largest universities are perfectly positioned to supply Mississippi with an industry-specific work-force and research primed for this emerging market. The Mississippi State University College of Agriculture and Life Sciences is nationally recognized for producing leaders in agricultural and biological engineering, agricultural economics, agronomy and biochemistry. And for 50 years, the University of Mississippi’s National Center for Natural Products Research has grown and researched cannabis at the nation’s only federally approved facility.
The intersection of these schools’ programs is unprecedented and unmatched anywhere in the country. Mississippi can be a national and global leader in hemp cultivation and processing by creating a home-grown industry founded on the human capital we already have.
Other states in the region are already strategizing on how to capitalize on what is being referred to as the “green rush.” If Mississippi wants to benefit from an agricultural product that will re-define hundreds of products we use every day and is expected to grow by 2,500 percent over the next three years, it needs to be assembling a team of policymakers, economic developers, farmers, state universities, and other agricultural professionals to map out a sound and reasonable plan.
Mississippi has the land, the work-force, the university support, a geographic and logistics advantage and is uniquely positioned to vertically integrate an emerging agricultural industry with hemp. If Mississippi does not take advantage of this very clear and unencumbered opportunity, it will be another addition to the long list of what could have been.
» Matthew P. McLaughlin is an attorney with McLaughlin, PC in Jackson, Mississippi, and serves as the executive director of the Mississippi Brewers Guild. Matthew’s passion is working with creative and entrepreneurial-minded people and organizations, having worked with and advised hundreds of entrepreneurs, startups, and social innovators throughout the Southeastern United States. He may be contacted at email@example.com or 601-487-4550, or you may visit www.mclaughlinpc.com for more information.
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