The number of hemp licenses granted in the U.S. state of Kentucky has dropped to 960 going into this year’s planting season, down from 978 last year, state agriculture officials announced.
And while the state said those licenses could translate to 32,000 acres under hemp in 2020, according to the Kentucky Department of Agriculture (KDA), 157 stakeholders applied for licenses only to store hemp left over from last year’s harvest, as the current oversupply of biomass destined for CBD production – in the USA and worldwide – takes its toll on Kentucky stakeholders. More than 90% of Kentucky hemp farmers grew for CBD in 2019.
CBD prevailed in 2019
Kentucky farmers planted hemp on 18,910 acres in 2019, according to the U.S. Department of Agriculture (USDA), while Kentucky’s agriculture department put hemp fields in the state at 26,500 acres for last year.
In further reporting on last year’s crop, KDA said processors and handlers recorded $193.9 million in sales, compared with $57.75 million in 2018. Kentucky farmers earned $51.3 million for harvested hemp materials in 2019, a three-fold increase over 2018. The state said processors spent $207.3 million on capital investment projects in 2019, as compared to $23.4 million in the previous year.
Processor licensing stable
Licensing of those processors, KDA said, looks to remain stable this year as 150 hemp applicants have already received licenses while another 60 await the outcome of their applications. That total of 210 would exactly match the number of hemp processors licensed in the state in 2019.
Kentucky’s current fortunes in hemp are partially exemplified by the bankruptcy earlier this year of CBD giant GenCanna, which faces a number of lawsuits from angry farmers and other contractors left in its wake. The company had been a poster child for the Kentucky hemp program, having received considerable incentives from state government.
Proceed with caution
“Hemp continues to draw much attention, and these new numbers reflect an industry that is still maturing,” KDA Commissioner Ryan Quarles said in a statement.
“The nation’s hemp industry is reacting to a market which is evolving in the face of supply chain issues and the uncertain future of cannabidiol (CBD) products after the Food and Drug Administration’s [FDA’s] years-long struggle to provide a regulatory framework for nutraceutical or food products,” Quarles said, urging state hemp stakeholders to “move forward in a cautious manner.”
