Spokane Journal of Business

Research pilot explores industrial hemp

Questions on production, processing still linger

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-—LeAnn Bjerken
Brian Main, founder of Spokane-based EVR CBD Inc., says CBD oil is one product that can be made from hemp. He contends the oil can be used to treat a number of medical conditions.
-—Hemp Logic Inc.
Moses Lake-based Hemp Logic Inc., a licensee in the Washington state Department of Agriculture’s hemp pilot project, has crops, shown above, growing in central Washington.

Last year, the passage of state Senate Bill 6206 made it possible for licensees to plant the first industrial hemp crop Washington state has seen in 90 years, through a research pilot program managed by the state’s Department of Agriculture called the Industrial Hemp Research Pilot. 

Despite the opportunities that some advocates contend the program could provide Washington’s ag industry, officials with the WSDA say it’s developing slowly, and many questions remain about how best to grow and process the new crop.

Hector Castro, Olympia-based communications director for the WSDA, says although the program is new, it’s generated a lot of interest from farmers and others who see potential in harvesting hemp.  

 “The law went into effect in 2016, but it’s taken us a while to establish the program,” Castro says. “We’re calling it a research pilot because it’s meant to help answer some of the unknown questions we still have about industrial hemp production and processing.” 

He says Senate Bill 6206 was approved by the state legislature in accordance with the 2014 Federal Farm Bill, and both the state and federal laws allow the growth of industrial hemp for research purposes only.

“The issue with hemp is that it’s a cannabis plant, but the prior farm bill authorized certain agriculture departments and universities to grow it for research if it was legalized in the state,” Castro says. “Our Legislature designed the bill to allow us to establish this program as a way of studying how it’s best grown, and whether it’s a viable market for our state.” 

The WSDA’s website states that although hemp and marijuana are related varieties of cannabis, hemp is bred for its fiber and seed oil, while marijuana is bred for its narcotic components.

Unlike marijuana plants, which are grown shorter and harvested mostly for their flowers, hemp stalks look similar to bamboo and can reach a height of 15 feet. Those stalks contain fiber and a woody core that’s used to create a variety of products, including hemp seeds and oil, fabrics and textiles, yarns and spun fibers, paper, carpeting, construction and insulation materials, animal bedding, foods and beverages, body care products, industrial oils, and cosmetics.

So far, Castro says, the state program offers four types of hemp licenses: grower, processor, distributor, and combination licenses. He says the program has awarded six licenses so far, and expects to see some of those licensees begin harvesting hemp as early as September. 

“We’re the only agency certified to distribute hemp seed, so we tried really hard to make sure the program was up and running with seed available to plant this season,” he says.  “The first crops were planted in May in Moses Lake.”

The licensees listed on the WSDA’s website so far include Hemp Logic Inc., of Moses Lake; Palmer Farms, of Moses Lake; KT Farms LLC, of Pasco; Kevin Murphy, at Washington State University’s Pullman campus; Bank Saver’s Nursery, of Arlington; and the Colville Confederated Tribes, of Nespelem.

In a July press release, the Colville Tribe announced it would be one of the first Native American tribes to cultivate hemp as a marketable agricultural commodity.

In the release, Colville Tribal Chairman Dr. Michael E. Marchand said the tribe began the project “…because hemp, along with a wider regenerative agricultural program, can have a significant positive economic impact on our reservation and its members.”

Castro says all licensees within the program are asked to record data relating to water usage, soil benefits, and more depending on which license they have. 

“We hope to gain a better understanding of how hemp is grown and how it affects the soil, so we’re better able to help others down the line in this industry,” he says. 

Looking ahead, Castro says a key concern facing the new program is a lack of future funding.

 “The difficulty now is being able to maintain service for the program,” he says. “We’ve only issued six licenses, so we haven’t accumulated much funding yet, but as new licenses are awarded they should provide additional funding.” 

Despite the small turnout of licensees for its first year, Castro says there is still a lot of interest in the program and the WSDA expects to see more license applications soon. 

 “Judging by similar programs in other states, it can take about a year for the level of applications and licenses to begin to increase,” he says.  

As to whether hemp production will become a more popular industry in Washington, Castro says, “It’s a bit early to speculate, but we’re expecting to learn a lot in this first year, particularly after the first harvest.”

While the state’s research program only allows licensees to grow and produce hemp for research purposes, some industry proponents also are interested in harvesting the plant for its potential medical uses. 

According to the University of Washington’s Alcohol & Drug Abuse Institute, there are more than 480 natural components found within the cannabis plant, of which 66 have been classified as cannabinoids. 

Cannabinoids are the chemical compounds that interact with receptors in the brain and body, creating various effects. 

Perhaps the best-known cannabinoid is tetrahydrocannabinol, or THC. THC is the only psychoactive cannabinoid and the one responsible for giving marijuana users that euphoric “high” feeling. 

The second best-known cannabinoid is cannabidiol, or CBD. CBD is a nonpsychoactive cannabinoid, valued for its potential medical uses including as an anti-inflammatory, anticonvulsant, antioxidant, and antipsychotic agent.

According to Medical Marijuana Inc., a San Diego-based company whose subsidiaries make and sell hemp-based products, while marijuana plants are bred and grown to produce a maximum of THC, hemp has almost no THC but does contain an abundance of CBD.

According to both federal and state law, industrial hemp must contain less than 0.3 percent THC on a dry weight basis. 

Additionally, because hemp and marijuana are so closely related, state law prohibits licensees from growing both. In fact, to prevent cross-pollination between the two crops, rules require a separation distance of four miles between fields until more research can be conducted on how cannabis pollen spreads.

Despite the associations between the two plants, Castro says he doesn’t think that marijuana has hurt people’s interest in growing hemp. 

“In terms of the relationship between hemp and marijuana, the laws for our state have established allowable THC levels and our field inspectors test to make sure THC content is at or below those levels,” he says. “We’ve also tried to address the issue of security by providing licensees with signs for their property to let passersby know their operation is licensed, and not associated with marijuana.”

Victor Shaul, Yakima-based seed manager for the WSDA, says most of the program’s initial inquiries about hemp production were from people interested in growing the plant for its fiber uses. 

“The excitement over fiber died down after people realized it’d be expensive to develop an infrastructure for making those products,” he says. “We already have infrastructure in place to process hemp seed into grain product, so that’s where we’re seeing the most interest now.”

Last month, the state Legislature’s House Bill 2064 went into effect, removing hemp from the state’s list of Schedule I controlled substances, but it’s still considered to be a Schedule I controlled substance by the federal government under the Controlled Substances Act of 1970.

The U.S. Drug Enforcement Administration amended its classification of cannabis as a Schedule I controlled substance last December, adding all extracts of the plant—including CBD—to the list of drugs with “no medical use.”

As a result of that change, it remains illegal in most states to extract CBD oils from hemp plants, but that doesn’t mean people have stopped asking about it. 

“We get a lot of interest in that question, but as the rules are written currently it’s not allowed,” says Castro. “We’ll be closely evaluating many elements of the program as we go along, but I can’t say whether those rules will be reevaluated.”

Spokane-based EVR CBD Inc. is one example of a company here that makes products from CBD oil for use as medicine to treat conditions such as epilepsy and Parkinson’s disease. 

Founded in 2015 by real estate developer Brian Main, EVR occupies 3,500 square feet of office space in the Commercial Building at 1119 W. First.

“There are many companies researching how CBD oil can help provide patients the therapeutic effects of this plant, without the undesirable effects of THC,” says Main. “When we started, I saw it as an investment opportunity with a lot of potential.”

Main says EVR makes CBD products for use as medicine in countries that have less restrictive laws on its use. The company’s main customers are national governments who approve patient use of CBD products through exceptional-use programs. 

“One of our largest clients is the country of Brazil, but there are many others who’re leading studies into using hemp products to treat various medical conditions,” he says. 

According to Main, EVR obtains its CBD oil from a USDA certified extraction facility in Colorado. Once the product arrives, it’s tested through Spokane-based cannabis testing lab Trace Analytics, before being adjusted for consistency and dosage, packaged, and shipped to patients. 

While EVR isn’t able to obtain CBD oil for its products from hemp plants grown here in Washington, Main says he’s familiar with the WSDA’s new program and sees it as a step in the right direction. 

“It’s a good start, and I commend the state’s efforts to get involved in the industry,” he says. “At the same time, it’s also one of those industries where you can’t just dip a toe in.” 

Main says he hopes to see the WSDA work toward shortening the license application process, as well as developing infrastructure for producing hemp fiber products. 

 “From speaking with my contacts in this industry, I know that being able to produce and process hemp fiber here would open up so many more opportunities,” he says. “So I hope the state continues to consult with industry experts, with an eye toward supporting more hemp fiber production.” 

Main says at the very least, he’s optimistic the state pilot program will provide further discussion about the industry. 

“I hope programs like this will help the government to begin to see the value in all types of hemp products, including those made from CBD oil,” he says. “Other countries and other states have gotten there, and we’ll eventually make it there too.”

LeAnn Bjerken
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Reporter LeAnn Bjerken covers health care at the Journal of Business. A Minnesota native and cat lover, she enjoys beachside vacations and writing poetry. LeAnn has worked for the Journal since 2015.

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