OR: In The Shadow Of Marijuana, Hemp Industry Is Starting To Develop

Photo Credit: Jon Kalish

Even by the standards of Oregon’s comparatively lax cannabis laws, Yon Olsen’s farm stands out. About 20 acres of farmland used to grow cannabis sits uncovered, in 825-foot rows where a nursery used to sit. Approximately 20 tons of freshly picked bushels of the plant sat in giant bags on his property to the east of Bend, ready to be sent to a processor.

However, because Olsen’s company, Cascadia, makes hemp — distinct from marijuana due to its much lower THC content — Olsen can grow massive amounts of the plant out in the open, without challenges from neighbors.

“It’s the same plant,” Olsen said. “Same smell, same visual impact, but it doesn’t have the same regulatory format, so we’re allowed to have fun and scale to levels that no one has ever been able to in the history of cannabis production.”

Marijuana, the psychoactive variant of the cannabis plant, has drawn headlines and controversy since Measure 91 passed in Oregon, with even small Deschutes County marijuana facilities drawing the ire of neighbors. Hemp has seen its own growth in the shadow of its psychoactive cousin, however, in Deschutes County and across the country. And some industry advocates believe this is only the beginning.

“The market (for hemp) is basically every human and every animal on the planet,” said Matt Cyrus, president of the Deschutes County Farm Bureau.

Like marijuana, hemp faced a rocky road to legalization. At the federal level, the Agricultural Act of 2014 allowed people to grow hemp wherever the crop is legal under state law. In Oregon, legalization was delayed, and much of the initial framework for the state’s hemp industry stems from House Bill 4060, passed in 2016 with support from the newly formed Oregon Industrial Hemp Farmers Association, according to Courtney Moran, founding principal of Earth Law, LLC, a Portland-based law firm that specializes in hemp.

The bill allowed Oregon farmers to grow cannabis plants with no more than 0.3 percent THC, a small fraction of the concentration found in psychoactive marijuana.

With that framework in place, Oregon farmers used 3,469 acres for hemp cultivation in 2017, up from 500 acres the year before, according to the nonprofit advocacy organization Vote Hemp. Moran added that the Oregon Department of Agriculture has issued 233 licenses to growers in Oregon, up from 77 in 2016.

“We’re seeing exponential growth,” Moran said.

Cyrus, who has about 25 acres of hemp on his property east of Sisters, said Deschutes County has only a handful of growers, but the region’s dry climate makes it a good fit for hemp, although Olsen added that occasional freezes during the summer can prove challenging.

Moran said hemp is durable and mold-resistant, and has uses in industries ranging from textiles to biofuels. However, with the infrastructure for those industries hampered by years of the crop being illegal, most growers, including Olsen, are most interested in the plant for a relatively new reason: Cannabidiol, known more commonly as CBD.

CBD is one of the active ingredients in cannabis, but unlike THC, it does not have any intoxicating effects. Instead, processors are interested in the product because of its alleged medical benefits. While the U.S. Food and Drug Administration has not approved CBD to treat or cure any disease, Cyrus said the drug has been linked anecdotally to helping with traumatic brain injury. Olsen added that using CBD has helped mitigate the effects of a degenerative hip condition.

“There’s enough people that believe in speculation; it’s a larger market every day,” Olsen said. “Everyone’s curious on CBD.”

In 2016, the industry publication Hemp Business Journal projected the CBD market to reach $2.1 billion nationally by 2020, with $450 million of that total coming from hemp. Since CBD isn’t regulated the way that THC is, Olsen said growers will often shoot for 17 percent CBD, more than 10 times the CBD content that would appear in recreational marijuana.

While Cyrus said growers have to be registered with the Oregon Department of Agriculture, they don’t need approval from the Oregon Health Authority or Oregon Liquor Control Commission, as recreational and medical marijuana growers do. Cyrus added that counties don’t have the discretion to add time, place and manner restrictions around the cultivation of hemp, the way that they can with marijuana.

“It’s just like growing corn or potatoes,” Cyrus said. “There’s nothing anybody can do.”

Following a brief opt-out, Deschutes County finalized its rules for marijuana production outside urban growth boundaries, with restrictions around odor, grow lights and other items. The rules have drawn criticism from rural residents as well as marijuana industry advocates, and the county’s public hearings on applications for new marijuana production facilities are frequently contentious.

By contrast, Cascadia’s operation, which is outdoors and much larger than the maximum plant canopy allowed for marijuana in Deschutes County, did not require county approval, despite being fundamentally the same crop as psychoactive marijuana. During the harvest season, Cascadia is a popular stop for Blazing Trails Tours, a Bend-based tour company that takes visitors to cannabis-related operations in Deschutes County. Co-owner Tris Reisfar said older visitors are often blown away to see that much cannabis out in the open.

“It’s the same five-pointed leaf,” Olsen added. “To us, it’s just a plant.”

To neighbors, it’s a bit more of a mixed bag. Alan Rousseau, owner of Pine Mountain Ranch, a bison and yak ranch adjacent to Cascadia, said the cannabis can get pungent during late August and September, but it doesn’t have much impact on him for the rest of the year. Despite one instance where a farmhand pulled a gun on Rousseau after he went onto Cascadia’s property to fix a broken waterline, he said Olsen had been easy to work with.

“My overall experience is that it was much better than I expected,” Rousseau said.

There are roadblocks in the path of hemp cultivation nationally. Cyrus said it remains a bit unclear when and how farmers can transport hemp across state lines to processors. He added that Oregon growers would like to see a higher THC threshold for hemp, because the plant’s THC levels will sometimes increase on their own.

Additionally, confusion with the plant’s psychoactive cousin can cause problems for growers. In 2016, Olsen’s first growing season, officers from the Deschutes County Sheriff’s Office came to his fence, believing he was growing marijuana illegally. After a discussion at Olsen’s fence line, the officers eventually left without citing him.

“I think there’s going to be a lot of confusion in the neighborhood as we go forward,” Olsen said.

Still, Cyrus thinks the crop is only going to get more popular. With the Cole Memorandum, which stipulated a hands-off approach to federal law enforcement in states with legal marijuana, now rescinded, Cyrus speculated that more and more growers could pivot to hemp, if marijuana ceases to be a viable option.

“I think it could actually be good for the hemp industry,” Cyrus said.