Wisconsin Hemp Overview & Resources
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Liz Binversie
Agriculture Educator
Extension Brown County
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RED = Other
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YELLOW = Sponsor
Use the sticker
dots if you
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more than one
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categories
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1st year grower
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2nd year grower
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Retailer
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Consultant
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Financial lender
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Education
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Other
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Weather
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Regulations
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Lack of educational
resources
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Networking
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Acquiring good seed
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Labor/Equipment
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Obtaining financing
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Networking
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Regulations
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Marketing
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Obtaining financing
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Credit card sales
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Education
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Find a buyer
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Find a seller
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Find a processor
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Learn more
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Network with others
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Disclaimers
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Overview of 2019 Wisconsin Hemp Industry
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Marketing & Economics study results preliminary summary
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UW Resources
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UW has 0 research
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General recommendations vs. individual consultation
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Young program
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NOT a get rich quick scheme
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December 12, 2017 – First emails
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January 3, 2018 – Greenlight for education
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March 2, 2018 – Emergency order
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February 2019 – First hemp meeting
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April 2019 – Satellite webinar
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May 2019 – Local grower meeting
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Aug/Sept 2019 – Speaking at field days
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Provide current, objective, and accurate information
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Unbiased source of information, education, and outreach
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Provide boots on the ground support
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Organize meetings
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Speak at events
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Consult, advise, or recommend where appropriate
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Conduct research: surveys, plot trials, collect crop analysis, etc.
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What is the best way to grow hemp | How do you grow it?
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What can we expect for CBD and THC levels by variety?
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What is the success rate with feminized seed?
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How do I know I’m getting a fair price?
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How do I find a buyer/processor/etc.
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What are nutrient recommendations?
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How do I know when to harvest?
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Should/how often to test for CBD/THC levels?
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Industrial hemp legalized grower/processor program in WI – 2018
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Pilot program to study growth, cultivation and marketing of hemp
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Defined as having less than 0.3% THC
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License/registration -Dept. Ag, Trade, Consumer Protection
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Grower: $750-1600+ (one-time license fee, registration, sampling)
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Processor: $100 fee (registration)
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165 DATCP-approved CBD varieties
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Conducted by University of Wisconsin-River Falls (Burney &
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Funded by the Renk Agribusiness Institute at UW-Madison
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Surveyed growers and processors (yield & pricing for 2018)
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Who responded?
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140 growers and processors
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108 growing only
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30 processing and growing
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2 processing only
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Networking (finding processor, buyer, grower mentors)
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Weather
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Acquiring seed
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Labor
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Equipment
6.
Financing
Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
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*Price of CBD/floral hemp is based on dried matter sold for CBD extraction, assuming 10% CBD per lb.
for floral material and 7% for biomass.
**Returns refer to revenue generated per acre. This is not a "net return," that is, it does not account
for cost of production.
Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
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Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
Industry standard for CBD yield is 1,500-2,000 pounds per acre
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*For operations smaller than 1 acre, cost of production is the average of total cost of production of all
Wisconsin growers available in the data
**Non-CBD hemp includes hemp grown for seed, grain, or fiber.
Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
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Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
Estimates are based on revenue generated by raw harvested plant, not from processed products
Also assumes hemp was sold as dried floral material or biomass, not trimmed smokable flower
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Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
Wisconsin’s hemp industry generated an estimated $26 million in revenue
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Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
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Wide variation in yield, cost, prices, and returns - infancy of industry
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Processing capacity as supply chain bottleneck
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First-time processors may have limited capacity
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This is an area the researchers want to continue studying
Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
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Less than 800 lbs/acre
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$5 to $7 per CBD %
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…
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If you would like to respond to the survey, please contact:
Shaheer Burney, PhD
Assistant Professor of Agricultural Business
University of Wisconsin, River Falls
shaheer.burney@uwrf.edu
Amber Remble, PhD
Assistant Professor of Agricultural Business
University of Wisconsin, River Falls
amber.remble@uwrf.edu
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M
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UW Hemp website
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Directory
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Buyer-seller listing
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Networking
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CBD & THC Test Results Sharing Tool
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Wisconsin Hemp YouTube channel
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x
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a
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Line up your market first
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Start at a manageable level
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Work the process backwards to decide how much to start growing
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Think in terms of per plant, not per acre
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Talk with other growers
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Be cautious
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Know what your risk is
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Consider working with your extension office
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g
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Check out UW hemp listings
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Settling for a lower price now might be better than nothing later
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Understand your risk
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Find a market for your hemp by October/November
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Use an attorney for any and all legally binding agreements
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If transporting through other states, be careful!
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Test, test, test!
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Consider sharing your testing data
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Consider working with your extension office
P
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s
s
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Consider adding your information to the UW Hemp listings
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Be an educational ambassador
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Curb expectations
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Use an attorney for any and all legally binding agreements
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Consider working with your extension office
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No infrastructure
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High risk/potential for high reward
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Steep learning curve
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Growers and others very passionate and excited
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Don’t bet the farm on it!
Q
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Liz Binversie
Agriculture Educator
Extension Brown County
920-391-4612
eybinversie@wisc.edu
This presentation covers various aspects of the Wisconsin hemp industry, including challenges faced by growers and processors, goals of a meeting, and disclaimers about research and consultation. It provides insights into the state's hemp market and resources available through the University of Wisconsin.
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Presentation Transcript
Wisconsin Hemp Overview Wisconsin Hemp Overview & & UW Resources UW Resources Liz Binversie Agriculture Educator Extension Brown County
Name tag instructions Name tag instructions GREEN = Grower BLUE = Buyer PURPLE = Processor RED = Other YELLOW = Sponsor Use the sticker dots if you identify as more than one of these categories
Thank you to our Sponsors! Thank you to our Sponsors!
I am a I am a 1. 1st year grower 2. 2nd year grower 3. 1st year processor 4. 2nd year processor 5. Retailer 6. Consultant 7. Financial lender 8. Education 9. Other 85% 41% 21% 15% 13% 10% 8% 0% 0% 1 2 3 4 5 6 7 8 9
What do you feel is the #1 challenge facing What do you feel is the #1 challenge facing hemp growers? hemp growers? 20% 20% 1. Weather 2. Regulations 3. Lack of educational resources 4. Networking 5. Acquiring good seed 6. Labor/Equipment 7. Obtaining financing 18% 12% 12% 10% 8% 1 2 3 4 5 6 7
What do you feel is the #1 challenge facing What do you feel is the #1 challenge facing hemp processors? hemp processors? 33% 1. Networking 2. Regulations 3. Marketing 4. Obtaining financing 5. Credit card sales 6. Education 19% 17% 17% 8% 6% 1 2 3 4 5 6
What do you hope to get out of todays What do you hope to get out of today s meeting meeting 1. Find a buyer 2. Find a seller 3. Find a processor 4. Learn more 5. Network with others 40% 24% 24% 11% 0% 1 2 3 4 5
Outline Outline Disclaimers Overview of 2019 Wisconsin Hemp Industry Marketing & Economics study results preliminary summary UW Resources
Disclaimers Disclaimers UW has 0 research General recommendations vs. individual consultation Young program NOT a get rich quick scheme
Background Background December 12, 2017 First emails January 3, 2018 Greenlight for education March 2, 2018 Emergency order February 2019 First hemp meeting April 2019 Satellite webinar May 2019 Local grower meeting Aug/Sept 2019 Speaking at field days
Extensions role Extension s role Provide current, objective, and accurate information Unbiased source of information, education, and outreach Provide boots on the ground support Organize meetings Speak at events Consult, advise, or recommend where appropriate Conduct research: surveys, plot trials, collect crop analysis, etc.
Questions Questions What is the best way to grow hemp | How do you grow it? What can we expect for CBD and THC levels by variety? What is the success rate with feminized seed? How do I know I m getting a fair price? How do I find a buyer/processor/etc. What are nutrient recommendations? How do I know when to harvest? Should/how often to test for CBD/THC levels? I don t know a common response We have more questions than answers
Regulatory Regulatory Industrial hemp legalized grower/processor program in WI 2018 Pilot program to study growth, cultivation and marketing of hemp Defined as having less than 0.3% THC License/registration -Dept. Ag, Trade, Consumer Protection Grower: $750-1600+ (one-time license fee, registration, sampling) Processor: $100 fee (registration) 165 DATCP-approved CBD varieties
DATCP Statistics DATCP Statistics - - State State 5,000 4,000 4,000 3,000 2,264 1,872 2,000 1,233 675 1,000 579 245 185 99 82 Processor licenses Processor locations Grower licenses Grower locations Growing acres 2018 2019
DATCP Statistics DATCP Statistics Brown County 2019 Brown County 2019 700 632 600 500 400 300 200 69 100 36 18 16 0 Processor licenses Processor locations Grower licenses Grower locations Growing acres*
Marketing & Economics Survey Research Marketing & Economics Survey Research
The Study The Study Conducted by University of Wisconsin-River Falls (Burney & Remble) analytics survey and anecdotal information Funded by the Renk Agribusiness Institute at UW-Madison Surveyed growers and processors (yield & pricing for 2018) Who responded? 140 growers and processors 108 growing only 30 processing and growing 2 processing only
Top 6 Biggest challenges Top 6 Biggest challenges 1. Networking (finding processor, buyer, grower mentors) 2. Weather 3. Acquiring seed 4. Labor 5. Equipment 6. Financing Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
Economic Variables by Hemp Type Economic Variables by Hemp Type CBD - Floral CBD - Biomass Seed/Grain Fiber Yield - US (lbs/acre) Prices ($/lb) Gross Returns ($/acre)** 1,100 $61* 1,500 $28* 1,025 $0.70 7,788 $0.07 $67,100 $42,000 $717 $545 *Price of CBD/floral hemp is based on dried matter sold for CBD extraction, assuming 10% CBD per lb. for floral material and 7% for biomass. **Returns refer to revenue generated per acre. This is not a "net return," that is, it does not account for cost of production. Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
2018 Hemp Yield 2018 Hemp Yield WI Survey Data WI Survey Data Hemp type State Avg yield/acre 645 lbs Low High CBD Grain Never farmed Grain farmers with experience 250 lbs 700 lbs 800 lbs 1,800 lbs Fiber (National) 2,000 11,000 Industry standard for CBD yield is 1,500-2,000 pounds per acre Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
Cost of Production Cost of Production Acreage All CBD Hemp Non-CBD Hemp $3,053 $11,168 $2,171 $400 <1 (average)* 1<=acres<=2 (per acre) 2<acre<=10 (per acre) acre>10 (per acre) $6,891 $10,519 $8,309 $4,316 $9,261 $10,335 $11,598 $9,797 *For operations smaller than 1 acre, cost of production is the average of total cost of production of all Wisconsin growers available in the data **Non-CBD hemp includes hemp grown for seed, grain, or fiber. Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
Revenue Earned by WI Hemp Growers Revenue Earned by WI Hemp Growers Hemp Type CBD Seed/Grain Fiber 2018 $25,578,581 $794,319 $39,361 $26,412,261 TOTAL Estimates are based on revenue generated by raw harvested plant, not from processed products Also assumes hemp was sold as dried floral material or biomass, not trimmed smokable flower Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
2018 Hemp value in Wisconsin 2018 Hemp value in Wisconsin CBD Hemp Trimmed smokable flower CBD-rich floral material Biomass Price/unit $200-700 per pound $61 per pound $28 per pound Wisconsin s hemp industry generated an estimated $26 million in revenue Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
How do prices compare nationally? How do prices compare nationally? CBD Hemp Crude hemp oil Refined hemp oil CBD isolate Price/unit $2,238 per kilogram | $1,017 per pound $5,451 per kilogram | $2,477 per pound $4,574 per kilogram | $2,079 per pound Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
Key points to the study Key points to the study Wide variation in yield, cost, prices, and returns - infancy of industry Processing capacity as supply chain bottleneck First-time processors may have limited capacity This is an area the researchers want to continue studying Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
GROWER QUESTIONS GROWER QUESTIONS
My yield of dried hemp biomass (flower, My yield of dried hemp biomass (flower, leaves, and stalk) falls in the range of leaves, and stalk) falls in the range of 50% 50% 1. Less than 800 lbs/acre 2. 800 to 1,200 lbs/acre 3. 1,200 to 1,500 lbs/acre 4. 1,500 to 2,000 lbs/acre 0% 0% 1 2 3 4
My CBD yield per lb. of dried hemp biomass My CBD yield per lb. of dried hemp biomass (flower, leaves, and stalk) falls in the range of (flower, leaves, and stalk) falls in the range of 50% 50% 1. Less than 5% 2. 5% to 8% 3. 8% to 10% 4. 10% to 15% 0% 0% 1 2 3 4
The price I received per lb. of dried hemp The price I received per lb. of dried hemp biomass (flower, leaves, and stalk) for CBD biomass (flower, leaves, and stalk) for CBD extraction falls in the range of extraction falls in the range of 1. $1 to $3 per CBD % 2. $3 to $4 per CBD % 3. $4 to $5 per CBD % 4. $5 to $7 per CBD %
My yield of dried hemp floral material falls My yield of dried hemp floral material falls in the range of in the range of 75% 1. Less than 800 lbs/acre 2. 800 to 1,200 lbs/acre 3. 1,200 to 1,500 lbs/acre 4. 1,500 to 2,000 lbs/acre 25% 0% 0% 1 2 3 4
My CBD yield per lb. of dried hemp floral My CBD yield per lb. of dried hemp floral material falls in the range of material falls in the range of 100% 1. Less than 5% 2. 5% to 8% 3. 8% to 10% 4. 10% to 15% 0% 0% 0% 1 2 3 4
The price I received per lb. of dried hemp The price I received per lb. of dried hemp floral material for CBD extraction falls in the floral material for CBD extraction falls in the range of range of 50% 50% 1. $1 to $3 per CBD % 2. $3 to $4 per CBD % 3. $4 to $5 per CBD % 4. $5 to $7 per CBD % 0% 0% 1 2 3 4
The research study continues The research study continues If you would like to respond to the survey, please contact: Shaheer Burney, PhD Assistant Professor of Agricultural Business University of Wisconsin, River Falls shaheer.burney@uwrf.edu Amber Remble, PhD Assistant Professor of Agricultural Business University of Wisconsin, River Falls amber.remble@uwrf.edu
UW Resources UW Resources
Getting Connected & Learning More Getting Connected & Learning More UW Hemp website Directory Buyer-seller listing Networking CBD & THC Test Results Sharing Tool Wisconsin Hemp YouTube channel
General Recommendations General Recommendations
For those who want to grow next year For those who want to grow next year Line up your market first Start at a manageable level Work the process backwards to decide how much to start growing Think in terms of per plant, not per acre Talk with other growers Be cautious Know what your risk is Consider working with your extension office
For current growers For current growers Check out UW hemp listings Settling for a lower price now might be better than nothing later Understand your risk Find a market for your hemp by October/November Use an attorney for any and all legally binding agreements If transporting through other states, be careful! Test, test, test! Consider sharing your testing data Consider working with your extension office
Processors Processors Consider adding your information to the UW Hemp listings Be an educational ambassador Curb expectations Use an attorney for any and all legally binding agreements Consider working with your extension office
Takeaways Takeaways No infrastructure High risk/potential for high reward Steep learning curve Growers and others very passionate and excited Don t bet the farm on it!
Questions? Questions? Liz Binversie Agriculture Educator Extension Brown County 920-391-4612 eybinversie@wisc.edu
