USDA Grants $5 Million To Tennessee Hemp Initiative

The state's hemp growing is down dramatically since 2020.

The U.S. Department of Agriculture (USDA) Partnerships for Climate-Smart Commodities has awarded a grant of nearly $5 million to a Tennessee hemp initiative. The group is led by Tennessee State University (TSU), in partnership with the Hemp Alliance of Tennessee (HAT), the University of Tennessee (UT), and the Tennessee Department of Agriculture with a goal to help expand markets for American producers who produce climate-smart commodities and provide meaningful benefits to small and underserved producers.

According to a statement, the project is one of 71 proposals selected as part of the second Partnerships for Climate-Smart Commodities funding pool, and one of only five hemp-related projects to receive funding as part of the program.

“Tennessee can become the leading producer of hemp in the Southeast United States,” said Frederick Cawthon, President of HAT. “We are committed to growing this industry responsibly, and we encourage all industries to examine how they can utilize this climate-smart and regenerative raw material.”

Hemp Acres Fall

Medical and adult-use cannabis is illegal in the state of Tennessee, but the state has legalized the cultivation of hemp and defined hemp as Cannabis sativa containing less than 0.3% THC. The state lists roughly 1029 licenses with 5,699 outdoor acres permitted for growing hemp and 6.3 million square feet of permitted indoor growing for 2021. That has almost dropped by 50% of what was allowed in 2020 according to Hemp Benchmarks.

Underserved Targeted

The project, “Climate-Smart Fiber Hemp: A Versatile Thread Connecting the Nation’s Underserved Farmers, Climate Change Mitigation and Novel Market Opportunities,” aims to expand the production of industrial hemp as a climate-smart commodity, evaluate its greenhouse gas benefits (GHG), and promote the value of market development to a cross-section of production agriculture, including small, medium, and underserved producers across the state of Tennessee. Special efforts are planned to identify and recruit underserved producers (e.g. minority producers, women, veterans), as well as farmers from the nine most economically distressed counties in Tennessee and the 30 counties at risk for becoming economically distressed. The proposal was granted an approximate funding ceiling of $4,972,800.

“TDA is pleased to collaborate with TSU, UT, and HAT on initiatives that keep agriculture the number one industry in Tennessee,” Agriculture Commissioner Charlie Hatcher, D.V.M. said. “We join them in efforts that aid in discovering new uses of industrial hemp and boost farming opportunities in rural areas. Tennessee is eager to increase support of new and existing hemp producers through this USDA grant award.” In September, the USDA Partnerships for Climate-Smart Commodities announced $2.8 billion in grants for 70 tentatively selected projects from the first funding pool, for projects between $5 million to $100 million. On Monday, the USDA announced an additional $325 million for 71 projects under the second funding pool, for projects from $250,000-$4,999,999.

According to the USDA, the second funding pool was particularly focused on innovative projects that emphasize enrolling small and underserved producers and investing in measuring, monitoring, reporting and verifying the benefits of climate-smart practices at minority-serving institutions.

Fiber Focus

Earlier this year, the Hemp Alliance of Tennessee announced a study on the feasibility of the production of hemp fiber in the state, funded by the Tennessee Department of Agriculture. The University of Tennessee was engaged to carry out the necessary research. The findings of the study, which will assess the likelihood of successful Tennessee-based production and processing for the various major uses of hemp fiber, will soon be released.

Debra Borchardt

Debra Borchardt is the Co-Founder, and Executive Editor of GMR. She has covered the cannabis industry for several years at Forbes, Seeking Alpha and TheStreet. Prior to becoming a financial journalist, Debra was a Vice President at Bear Stearns where she held a Series 7 and Registered Investment Advisor license. Debra has a Master's degree in Business Journalism from New York University.

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