Rebirth of an Industry: Opportunities and Barriers to the Growth of Minnesota's Hemp Industry

Abstract

Prepared for Minnesota Hemp Farmers and Manufacturers Association. After more than 80 years of prohibition, hemp has emerged as a new addition to the agricultural landscape in the United States. Since its re-legalization in 2014, it has sparked the imagination of many in the farm sector as a possible source of diversification and added revenue. The nascent industry has grown fast and experienced precipitous price drops in the last two years. It is within this context that the Minnesota Hemp Farmers and Manufacturers Association (MHFMA) engaged a team of graduate student researchers at the University of Minnesota’s Humphrey School of Public Affairs to investigate opportunities to unite Minnesota hemp farmers for mutual economic gain. Because of hemp’s unprecedented emergence as a new crop, the project intentionally had a broad focus that can potentially serve as a baseline for other research efforts.

Methods In order to achieve project objectives, three research questions were developed to help guide our work. Those questions were answered through a literature review and twenty in-depth interviews with stakeholders from across the spectrum of the hemp industry.

Findings A theme that explicitly and implicitly permeated every interview conducted was the uniqueness of the emerging hemp industry in the United States. As one person explained, new crops and agricultural products are introduced from time to time, each with its own opportunities and challenges to becoming viable in the marketplace. However, it is hard to identify any sort of precedent for the emerging experience of the hemp industry. It is a crop that was illegal to grow for decades, leading to myriad barriers not to mention the typical challenges of a new product. The entire support structure that would normally be available to new and existing agricultural products—plant research, applied and extension researchers providing agronomic information, grants, access to banking, and so on—have generally not been available to the hemp industry or are slow to emerge.