Hemp in Indiana: Today and Tomorrow

It is still illegal to grow marijuana in Indiana (for now, at least!). Right now, with a license, hemp production for research purposes is allowed. Soon, general grower licenses likely will be available.

Industrial hemp refers primarily to Cannabis sativa L. (Cannabaceae). There are thousands of uses for hemp, from medicinal and food grade oils from the seeds to paper and clothing from the fibers. Analysts predict the hemp market could hit more than $20 billion in the next few years. First grown in North America in the 1600s, Washington and Jefferson were among the Founding Fathers who grew hemp for fiber. The hemp industry continued until the Marijuana Tax Act of 1938. This Act ended the legal production of hemp in the United States.

Hemp seeds

TODAY: The Office of Indiana State Chemist (“OISC”) is currently licensing hemp researchers under IC 15-15-13, especially research focused on hemp processing infrastructure. The process starts with the researcher at an in-state university. The researcher completes an application for an Indiana Industrial Hemp (Research) License, which is available from the Office of Indiana State Chemist and Seed Commissioner here. Next, the Indiana State Police conduct a background check on the producer. After receipt of an approved license, a university researcher must apply to the DEA as a “Researcher – Schedule 1 Only.” The researcher must complete DEA Form 225 and the “Protocol” found in 21 CFR 1301.18. DEA field personnel will conduct on‐site inspection of research facilities, secured storage area for hemp seed, and designated research plots. Here in Indiana, roughly 30 hemp licenses have been issued or are in process.

TOMORROW: The 2018 Farm Bill legalized industrial hemp production on a federal level. Right now, the Indiana legislature is considering Senate Bill 516 and Senate Bill 627 to update Indiana law to match the federal farm bill language. Hemp must test below 0.3% THC, or it will be considered illegal marijuana. Practically, growers should consider several issues:

Seed Retailers - since hemp has been illegal for so long, seed retailers will need time to secure adequate supplies for hemp production. Seed supplies from other states are likely to be more expensive and require significant shipping expenses.

Business Plan - farmers should decide specifically what type of hemp they’d like to grow. Certain products require particular varieties of hemp. Steps should be taken to determine the market you will pursue (CBD, fiber, etc.) and identify the varieties best suited to that market.

Contracts - A grower should negotiate a contract detailing crop specifications, price, and amount before purchasing seed from a retailer and before selling to a buyer or processor.

Pesticides - because hemp production has been illegal for years, the federal government has never approved pesticides for it. Applying traditional pesticides would be an illegal off-label use.

Processors - as of this time there are no processors in state. Secure a market for your product before taking the plunge.

This year (2019) is expected to be a planning year, and 2020 should be the first year of full scale production here in Indiana. Producers looking to diversify should consider whether hemp production fits into their farms.