NAIHC Annual Meeting 2005 Report

NAIHC - North American Industrial Hemp Council
A Renewable Industrial Fiber & Oil Crop

NAIHC 2005 Annual Meeting Report:
IH Prospects Bright

After several challenging years followed by 2005's dramatic U.S. court victory re-authorizing sales of industrial hemp food products in the United States, prospects are brighter than ever for industrial hemp. Since growing industrial hemp is legal in Canada but not in the U.S., the immediate benefits will flow to Canada. But with both industrial hemp markets and public support growing, there is movement toward U.S. legislation at state and national levels to re-introduce industrial hemp as a legal crop in the U.S.

Those were among the main points made in discussions at the annual North American Industrial Hemp Council (NAIHC) meeting in November. Members also voted to re-elect the current board for the coming year, with the principal officers remaining Erwin A. "Bud" Sholts as Chair, Gale Glenn as Vice Chair, Karen Fraase as Secretary and Andy Kerr as Treasurer. For a complete list of board members, Click Here. http://naihc.org/NAIHC_overview/board.html

A detailed report on industrial hemp performance and prospects was delivered by NAIHC member Geofrey Kime, President of Hempline Inc., North America's leading producer of hemp fibers from its facility near Delaware, Ontario. (For information on Hempline, visit http://hempline.com.)

Industrial Hemp Recruits New Supporters

In other reports, Board members Andy Kerr, Jeffrey Gain, and David Monson, a North Dakota State Representative, listed a series of meetings that Board members held over the past year with government officials at both state and national levels. They reported particular interest in North Dakota in considering various legal and legislation initiatives aimed at re-introducing industrial hemp as a legal crop in the United States.

Board members noted there also have been productive meetings with the Vote Hemp organization and with the National Association of State Departments of Agriculture (NASDA) aimed at coordinating efforts to raise awareness among government officials and the general public about industrial hemp. Andy Kerr explained that this approach appears to be the best option after years of being "stymied and frustrated in our efforts to achieve administrative reform through the Bush administration and its departments of government."

David Monson said that as awareness spreads that there is substantial support for industrial hemp not just from North Dakota growers but from a broad range of interests throughout the U.S., "legitimacy has grown because it's not just Dave Monson, it's people from all over the country." He also pointed to "excellent press coverage" and forecast that one next step could be "a constitutional amendment to North Dakota's Constitution to support industrial hemp."

Jeffrey Gain noted that legislation has been introduced by Rep Ron Paul (R. Tex.) which "would simply remove industrial hemp from the Controlled Substances list."

Hemp Documentary on DVD

Vice Chair Gale Glenn noted that the DVD documentary by Kevin Balling, "Hemp and the Rule of Law," has had a positive impact by creating a vivid picture of industrial hemp's legendary past in U.S. agriculture and by chronicling the heated debate to return the crop to American farmers. (Click Here to order a copy of the DVD.)

Geof Kime Report

In a detailed report to the membership, Geof Kime of Hempline in Canada reported that over the past three years, the U.S. Drug Enforcement Administration (DEA) ban on U.S. sales of industrial hemp food products "had a chilling effect on the markets." He said "The ability of the hemp industry to take on the DEA and win, that's really opening up the markets and has spawned quite a bit of growth in the Canadian hemp industry." He said one result of the court victory was that Canadian hemp acreage more than doubled over the past year to nearly 20,000 acres compared to the previous level of seven to eight thousand acres "with the majority being produced for the grain products, for products intended for human consumption, for oil for salad dressing, hemp-nuts type products, and new materials, specifically hemp protein powders."

Kime said that thanks to research achievements, previous waste products now are refined into hemp-product powders "selling it at a very high price." He said that particularly in Western Canada and particularly for organic growers, farmers are finding that industrial hemp is profitable and "fits well into the rotation now that the markets are more clear and stable."

Hemp Fiber Replacing Synthetic Materials

Kime predicted brighter prospects ahead for the fiber side of the market as well. He expects accelerated market demand for hemp fiber due to "the rising price of oil, so the idea of finding lower-cost renewable resource based materials to displace or totally replace oil-intensive or energy-intensive synthetic materials is spurring on the market and the demand." He noted that the automotive industry is an expanding market since "they've had good success in using hemp, jute, flax, and kenaf in making interior composites. Now the challenge is to try to go exterior with these materials, specifically targeting some of the products that don't need a Class A paint finish, such as in the wheel wells. They are trying to bring the weight of the cars down and bring the cost of the composites down and so in the face of rising costs for polypropylene and other synthetics, it's really opening the door for natural fibers to enter the market."

Kime added that "We're seeing these applications with composites spreading into other areas as well, beyond automotive and construction applications to other consumer-type products, even some airline applications, so it's a very active area, with demand very strong."

Kime said that access to capital has improved due to removing the DEA ban on hemp food products and to cost savings from replacing oil-based products. He said that his own company's expansion plans were delayed for several years. But he said the good news is that the DEA-driven delay in market growth "has allowed us in fact to build the markets and build a very strong awareness of what the markets are and what our competition is and get a lot of research and development done."

Responding to questions about returns, Kime said "Organic hemp grain production is quite lucrative if you can get the yields, if you can get the grain off and get it dried successfully and get it ready for market." He said returns should improve further as Canada introduces new "domestically adapted varieties that are registered here so that we are not dependent on imports from outside of Canada for our planting seed."

Kime concluded that "It of course hasn't been an easy industry to get off the ground given the regulatory components, but the feeling is very much that some of that is behind us, particularly in Canada, and now we are moving into more of the real business issues of expanding markets and expanding capacity."

Return to Top of Page