Certified seed shortage hinders hemp expansion

Strong demand | Contract prices are up to 85 cents per pound compared to 70 cents last year

Hemp will likely top out at 90,000 acres this year, falling short of earlier predictions of more than 100,000 acres in Canada.

Russ Crawford, Canadian Hemp Trade Alliance president, said a lack of certified seed has restricted acreage expansion.

“That has become the bottleneck,” he said. “Our guess is we’re somewhere between 85,000 and 90,000 (acres). I think we could have made it (to 100,000) in a heartbeat if we had the seed availability.”

Canadian farmers, primarily on the Prairies, grew about 70,000 acres of hemp last year.

Over the winter, industry watchers predicted Canadian hemp acres would top 100,000 in 2014 because of robust consumer demand for hemp seed, protein powder, hemp milk and related products.

Crawford said acres will definitely increase across the Prairies, but he didn’t have detailed information on provincial data.

“Saskatchewan has been floating around that 50 percent of the total acres. I would expect they would retain that,” he said, adding Alberta acreage will likely rank second, followed by Manitoba.

“We’re fighting with corn and bean crops there (in Manitoba). They’re pretty new and exciting, with good returns.”

Kevin Friesen, operations manager with Hemp Genetics International, a company that develops and sells hemp varieties, said the crop could still hit 100,000 acres this year.

He said there are reports of shortages, but certified seed is still obtainable.

“We (aren’t) sold out. I normally plan have to have twice the seed available as what we think we require,” he said. “(And) Hemp Oil Canada, I manage their Finola seed supply, and there is also seed available there.”

Nearly every acre of hemp is grown under contract from processors like Hemp Oil Canada and Manitoba Harvest.

The industry attempts to match supply to demand, which may ex-plain why acres haven’t jumped dramatically.

“It’s important that it’s well-managed, so there isn’t over production as there has been in previous years,” Friesen said.

Prices for other oilseeds dropped over the winter but hemp contract values actually rose relative to 2013.

“Last year, the average price for conventional (hemp grain) was in the 70 cents (per lb.) range. This year it’s 80 to 85 cents,” Crawford said. “I guess they (processors) feel the demand is so strong for the product out there, they really wanted to make sure they got their acres.”

Crawford said organic hemp was contracted at approximately $1.50 per lb., nearly double conventional hemp prices.

Organic hemp represents a sizable chunk of the entire crop in Canada, Crawford said.

“I would think as much as a quarter to a third of the crop is organic,” he said.

Hemp might not reach 100,000 acres this year, but the industry expects vigourous growth over the next five years, Crawford said.

“By 2018, we hope to be in the quarter million (acres) range.”

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