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BUSINESS NEWS 16 • MARCH 2022 COAST RIVER BUSINESS JOURNAL Possible hemp restrictions raise concerns on industry By MATEUSZ PERKOWSKI Capital Press Oregon counties may suspend new hemp produc- tion under a bill recently passed by the Legislature, raising concerns in the industry about farmers missing economic opportunities. Under Senate Bill 1564, which now awaits the sig- nature of Gov. Kate Brown, county governments can declare an emergency to stop the issuance of new state hemp licenses for two years. Hemp production in Oregon has already fallen pre- cipitously due to an oversupply, but county restrictions could hinder an industry resurgence at a time when new uses for the crop are multiplying, experts say. <The negative impact is it sends a message to the rest of the country that Oregon is not where you want to do hemp,= said Beau Whitney, an economist who tracks the industry. <It puts the state farther and far- ther behind.= Excitement about the high demand and health- ful efects of cannabidiol, or CBD, caused a surge in hemp production that was soon followed by a surplus, prompting many farmers to abandon or reduce culti- vation of the crop. Acreage across the U.S. dropped by more than 50% last year, while Oregon9s acreage plummeted more than 80%, according to Whitney. At the same time, Oregon law enforcement author- ities have complained to state lawmakers that hemp is being used to disguise the illegal production of mar- ijuana, a related cannabis crop with psychoactive properties. <When you can9t regulate an industry, it makes no sense to add more work for our regulatory agen- cies,= testioed Nathan Sickler, Jackson County9s sher- if, during a legislative hearing last month. The original language of SB 1564 would have imposed a two-year moratorium on new hemp licenses, but the bill was amended so that the decision was left to counties. The idea was to provide local control since the problem with sham hemp farms was mostly reported in Jackson and Josephine counties. However, the amount of licensed hemp grown in TRINSIC SERIES | V300 PATIO DOORS " " " " Modern Style Expansive Viewable Glass Narrow Frame Proole Aesthetically Pleasing Sleek, Clean Look NOW AVAILAB BLACK INTERIO LE IN BLACK EXTERIO R/ R Residential • Commercial (503)717-0555 2793 Hwy 101 N., Gearhart " www.kiwiglass.com Licensed, Bonded & Insured " OR CCB#119815 " WA#KIWIGI00217 MATEUSZ PERKOWSKI/CAPITAL PRESS Hemp is harvested from an Oregon field. hoop house systems common for marijuana represents less than 2% of state acreage, Whitney said. <The data does not support the narrative at all,= he said, referring to licensed hemp growers allegedly producing black market marijuana. <Will this really do any good? Probably not.= Whitney said it9s commendable that lawmakers scaled back the bill9s scope in response to hemp indus- try concerns, but he fears the bill still sends the wrong signal. Hemp is seeing new demand in products that have nothing to with CBD, including bioplastics and live- stock feed, he said. The crop can even by used as an alternative to lithium in batteries. Meanwhile, carbon credits 4 which are sold to ofset emissions 4 are poised to become a new reve- nue source for hemp farmers, he said. <This regulatory uncertainty is impacting the ober and grain side,= Whitney said. <It9s suppressing the growth and development. At the time Oregon should be supporting hemp on an industrial scale, it9s trying to put restrictions on hemp.= Mark Taylor, founder of the Southern Oregon ACREAGE ACROSS THE U.S. DROPPED BY MORE THAN 50% LAST YEAR, WHILE OREGON’S ACREAGE PLUMMETED MORE THAN 80%, ACCORDING TO BEAU WHITNEY, AN ECONOMIST WHO TRACKS THE INDUSTRY. Hemp Cooperative, said the bill could punish grow- ers who wisely decided to stop growing hemp tempo- rarily due to the oversupply or for crop rotation. It also blocks legitimate newcomers with fresh ideas from the industry. <They9re penalizing us for their lack of pre-plan- ning,= Taylor said of state lawmakers. <You restrict brainpower that could come in and do it better.= Oregon hemp farmers have drastically scaled back planting in response to market conditions, which isn9t recognized by lawmakers who don9t understand the industry, Taylor said. <The market self-adjusted and they gave no due to that whatsoever,= he said. The state government would have been more efective with outreach and education to the hemp industry and other farmers, warning them to keep an eye out for bad actors who9d attempt illicit marijuana production, Taylor said. <I don9t think government spends enough time on the ground,= he said. <They9re in their ivory tower.= County restrictions would diminish the industry9s competitive spirit and amount to the government pick- ing winners and losers by allowing existing growers to keep their licenses, Taylor said. <It all speaks of gov- ernment overreach.=