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UW-Madison Study: Industrial Hemp Won’t Replace Traditional Crops

Even if industrial hemp production became legal, few U.S. farmers would find the crop profitable, according to a University of Wisconsin-Madison study.

The Puritans brought hemp to New England in 1645 to grow for fiber. George Washington and Thomas Jefferson grew hemp. However, American farmers have not grown industrial hemp for more than 50 years because of its close ties to marijuana.

“If the crop were legal, the methods used to harvest and process industrial hemp along with limited markets would keep U.S. farmers from growing the crop on any significant scale, at least in the near future,” says Randy Fortenbery.

Fortenbery, the study”s lead author and a UW-Madison expert on agricultural markets and international trade, presented his findings Oct. 3 to the Wisconsin Assembly”s Agriculture Committee.

Hemp was domesticated in China more than 4,000 years ago. China is the largest producer of industrial hemp, which is also grown in North Korea, and Europe. Canada recently approved the crop on a limited scale.

The Wisconsin study is less than encouraging news for advocates of industrial hemp. They cite the many products that can be made from the crop. Fibers from plant stems are used in textiles, pulp, and paper, while oil from the seeds is used in foods and lotions.

Low grain prices have farmers looking for alternative crops, and industrial hemp has generated a great deal of interest. The crop grows under a wide variety of soil and climatic conditions, and requires few pesticides. When grown as part of a crop rotation, industrial hemp can break up pest cycles and help growers reduce the pesticides they apply to traditional crops.

In the most comprehensive overview to date, Fortenbery and his research colleague Michael Bennett – both with the College of Agricultural and Life Sciences – reviewed more than 75 studies, articles and reports about industrial hemp.

“We tried to bring together all the knowledge that has been accumulated over the last 100 years,” Fortenbery says. The study also identified areas where research is needed if American farmers are to grow the crop profitably.

“If growing industrial hemp became legal overnight, it would be a useful crop for a few growers. However, it is not likely to improve farm revenue for at least four or five years,” Fortenbery says. “Studies indicate that it would be slightly more profitable than traditional row crops but less profitable than specialty crops such as tobacco, fruits and vegetables.”

Fortenbery and Bennett caution that widespread production of industrial hemp would drive down prices by quickly swamping the small but growing North American market. The report suggests that just 25,000 acres to 35,000 acres of industrial hemp could meet the current North American demand for hemp fiber and seed. Fewer than 100 farms could supply that market, according to Fortenbery. With such a small market, growers would be vulnerable to wide price fluctuations, he says.

For hemp to be used widely, it must be cost competitive with other raw materials. Most consumer products currently made from commercial hemp can also be manufactured from other crops.

“Hemp would definitely face fierce competition from many other well-established crops with many of the same potential uses,” Fortenbery says. “Potential competitors include other fiber crops such as abaca, kenaf, flax and jute, and even corn, soybeans, sorghum and cotton.”

Industrial hemp could not become a major crop for U.S. producers unless major innovations reduce costs so that hemp can compete with other fiber and oilseed crops, according to the report. “Industrial hemp is especially expensive to harvest, transport and process,” Fortenbery says. “If we want to invest in research, this is where the money should go.”

Harvesting industrial hemp requires multiple steps. In Europe it is first cut and laid in windrows. Over two to three weeks, bacteria degrade the stems so they can be processed more easily. Then a second machine gathers the hemp and ties it into bundles for delivery to processing plants.

Although American imports of hemp have increased over the last decade, the international outlook is much gloomier, according to Fortenbery. Worldwide hemp production declined nearly 70 percent during the past 30 years as other fiber crops replaced hemp.

“Today”s major world suppliers are generally those countries with low labor and resource costs, as well as European producers that have benefited from government subsidies,” Fortenbery says.