This document provides an overview of the Wisconsin hemp industry and resources from the University of Wisconsin (UW). It summarizes the results of a UW study on hemp economics and marketing. The study found the top challenges for growers are networking and weather, while for processors it is regulations. Yield and price data is provided for different hemp types. The document outlines UW resources like websites and testing tools. It concludes with recommendations to connect with others, start small, find markets, and work with extension offices.
2. 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
4. I am a
1 2 3 4 5 6 7 8 9
85%
10%
13%
0%
41%
8%
0%
21%
15%
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
5. What do you feel is the #1 challenge facing
hemp growers?
1 2 3 4 5 6 7
20%
18%
12%
10%
20%
8%
12%
1. Weather
2. Regulations
3. Lack of educational
resources
4. Networking
5. Acquiring good seed
6. Labor/Equipment
7. Obtaining financing
6. What do you feel is the #1 challenge facing
hemp processors?
1 2 3 4 5 6
19%
33%
17%
6%
8%
17%
1. Networking
2. Regulations
3. Marketing
4. Obtaining financing
5. Credit card sales
6. Education
7. What do you hope to get out of today’s
meeting
1 2 3 4 5
24%
0%
11%
40%
24%
1. Find a buyer
2. Find a seller
3. Find a processor
4. Learn more
5. Network with others
8. Outline
• Disclaimers
• Overview of 2019 Wisconsin Hemp Industry
• Marketing & Economics study results preliminary summary
• UW Resources
9. Disclaimers
• UW has 0 research
• General recommendations vs. individual consultation
• Young program
• NOT a get rich quick scheme
10. 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
11. 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.
12. 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?
13. 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: $100 fee (registration)
• 165 DATCP-approved CBD varieties
17. The Study
• Conducted by University of Wisconsin-River Falls (Burney &
Remble) – analytics survey and anecdotal information
• Funded by the Renk Agribusiness Institute at UW-Madison
• Surveyed growers and processors (yield & pricing for 2018)
• Who responded?
• 140 growers and processors
• 108 growing only
• 30 processing and growing
• 2 processing only
18. Top 6 Biggest challenges
1. Networking (finding processor, buyer, grower mentors)
2. Weather
3. Acquiring seed
4. Labor
5. Equipment
6. Financing
Data source: The economics and marketing of industrial hemp in WI. Burney and Remble, 2019. UW-River Falls
19. Economic Variables by Hemp Type
CBD - Floral CBD - Biomass Seed/Grain Fiber
Yield - US
(lbs/acre) 1,100 1,500 1,025 7,788
Prices ($/lb) $61* $28* $0.70 $0.07
Gross
Returns
($/acre)** $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
20. 2018 Hemp Yield – WI Survey Data
Hemp type State Avg
yield/acre
Low High
CBD 645 lbs
Grain – Never farmed 250 lbs 700 lbs
Grain – farmers with experience 800 lbs 1,800 lbs
Fiber (National) 2,000 11,000
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
21. Cost of Production
Acreage All CBD Hemp Non-CBD
Hemp
<1 (average)* $6,891 $9,261 $3,053
1<=acres<=2 (per acre) $10,519 $10,335 $11,168
2<acre<=10 (per acre) $8,309 $11,598 $2,171
acre>10 (per acre) $4,316 $9,797 $400
*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
22. Revenue Earned by WI Hemp Growers
Hemp Type 2018
CBD $25,578,581
Seed/Grain $794,319
Fiber $39,361
TOTAL $26,412,261
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
23. 2018 Hemp value in Wisconsin
CBD Hemp Price/unit
Trimmed smokable flower $200-700 per pound
CBD-rich floral material $61 per pound
Biomass $28 per pound
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
24. How do prices compare nationally?
CBD Hemp Price/unit
Crude hemp oil $2,238 per kilogram | $1,017 per pound
Refined hemp oil $5,451 per kilogram | $2,477 per pound
CBD isolate $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
25. 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
27. My yield of dried hemp biomass (flower,
leaves, and stalk) falls in the range of
1 2 3 4
0% 0%
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
28. My CBD yield per lb. of dried hemp biomass
(flower, leaves, and stalk) falls in the range of
1 2 3 4
0%
50%
0%
50%
1. Less than 5%
2. 5% to 8%
3. 8% to 10%
4. 10% to 15%
29. The price I received per lb. of dried hemp
biomass (flower, leaves, and stalk) for CBD
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 %
30. My yield of dried hemp floral material falls
in the range of
1 2 3 4
75%
0%
0%
25%
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
31. My CBD yield per lb. of dried hemp floral
material falls in the range of
1 2 3 4
100%
0%
0%
0%
1. Less than 5%
2. 5% to 8%
3. 8% to 10%
4. 10% to 15%
32. The price I received per lb. of dried hemp
floral material for CBD extraction falls in the
range of
1 2 3 4
0%
50%
50%
0%
1. $1 to $3 per CBD %
2. $3 to $4 per CBD %
3. $4 to $5 per CBD %
4. $5 to $7 per CBD %
33. 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
37. 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
38. 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
39. 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
40. 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!
2018
22 greenhouse acres planted
Of the 185 grower registrations issued, 135 actually planted
Note: growing acres are reported at time of DATCP application which ended March 1, 2019. Statewide, growing acres are MUCH lower than what growers anticipated at the time of the license/registration application process
Weather concerns were based on 2018 data, though 2019 has also been a challenging year too (lots of rain and generally wet conditions reported for 2018 and 2019 comments are similar)