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ARS Home » Pacific West Area » Corvallis, Oregon » Forage Seed and Cereal Research Unit » Research » Research Project #438346

Research Project: Economic Potential of Pacific Northwest Hemp Production Systems

Location: Forage Seed and Cereal Research Unit

Project Number: 2072-21000-056-002-S
Project Type: Non-Assistance Cooperative Agreement

Start Date: Jul 1, 2020
End Date: Jun 30, 2022

Objective:
Objective 1: development of enterprise budgets for hemp systems in 4 Oregon regions will continue, with in-person meetings with industry representatives if feasible, or remotely if in-person not feasible. Objective 2: in-person training activities with growers that were not possible due to Covid restrictions will be undertaken if feasible. If in-person is not feasible, remote activities will be undertaken. Objective 3: (analysis of hemp system adoption and impact using the TOA-MD model), the cooperator will access 2017 US agricultural census data on the U Chicago/NORC Data Enclave to characterize current agricultural systems and carry out analysis of hemp system adoption and impact (as approved by a proposal submitted to NASS in October 2020 and approved in April 2021) In addition to original goals of Objective 3, the analysis will include a more complete evaluation of hemp system economic feasibility using extensions of the TOA-MD model developed during Year 1 of the project. In particular, the effects of hemp price uncertainty and cost of production uncertainty will be more rigorously evaluated using this new version of the model. This extension will enable a more useful and credible analysis of hemp potential adoption and economic impact. Objective 4: as in initial proposal, co-PI will coordinate with Extension and interested SWCD's in Oregon to provide producers with educational opportunities on hemp; in person meetings will be held if feasible.

Approach:
This study will develop economic information needed for producers and the industry to evaluate the potential for adoption of hemp by commercial scale farms currently engaged in crop production in the Willamette Valley and in the irrigated crop producing region of the Columbia river basin of Oregon and Washington. The specific objectives are to: (1) develop better data on cost of production for hemp-based systems; (2) develop an interactive Excel spreadsheet tool for Extension faculty to show the whole farm net returns for a representative farm and breakeven price to adopt hemp, replacing current crops; (3) utilize an economic simulation model (TOA-MD) to simulate the potential for hemp to replace other crops in the region. The project will produce public data on hemp production costs, a tool for analyzing farm-level economics of hemp adoption, and region-wide data on hemp potential adoption rates and impacts. Extension publications and a research paper on the regional modeling will be produced; (4) coordinate with Extension and interested SWCD's in Oregon to provide producers with educational opportunities that demonstrate the potential financial and production risks of growing hemp, as well as the potential for hemp industry to replace existing crops in the region.