Agriculture Reference
In-Depth Information
irrelevant. The price paid in each region must
be pitched at a level that is relative to what will
entice the farmer to grow hemp as opposed to
another crop.
In Australia, farmers are paid $250/t
for semi-processed hurds when delivered to
the mill, with an average yield of 10 t/ha or
more. This rate makes hemp a reasonably
attractive summer crop alternative compared
to sorghum or maize, but not better than
cotton or poppies. However, crop returns
fluctuate: whereas sorghum was $150/t a
year ago, demand and supply conditions
have seen it rise recently to as high as
$300/t. In the case of cotton, the price has
gone the other way. The only way hemp can
combat the competitive crop issue is to allow
the price to fluctuate along with the other
crops or forward contract crops and lock in
a price with farmers in advance. If advance
price fixing can be achieved, it will obviously
be better for certainty in supply to
manufacturers.
There is significant room for crop
improvement, higher yields and lower produc-
tion costs. With ongoing development in plant
improvement and agronomic treatment, we
could achieve a 25% increase in average yield
from 10 t/ha to 12 t/ha. The mill price could
then be reduced by 12% from $250/t to
$220/t, yet still allow for a 5% increase in
grower earnings. This would make hemp even
more competitive as an alternative to tradi-
tional crops.
Overall higher yields, through plant breed-
ing, could be achieved in approximately a 3-5
year time frame. Lowering production costs
probably could be achieved even faster.
Yield increase efficiencies will be derived
from:
•
Stable fixed price (buffer to fluctuations)
•
Low cost to grow crop (crop inputs)
•
Potential for carbon credits for growing an
industrial crop such as hemp.
Higher fibre/hurd proportion (plant
breeding and planting systems)
Temperate varieties of hemp stalk grown in the
EU and Canada have a ratio of fibre to hurds of
approx 25:70%, whereas tropical varieties of
hemp used by EIL are 18:77% (all include 5%
loss). Using current market figures, temperate
varieties have a higher net value than tropical
hemp (i.e. temperate = AU$565/t, tropical =
AU$527/t of stalk using a value of AU$1000/t
fibre and AU$450/t hurd).
These figures obviously promote the need
for a higher fibre content in all varieties of
stalk, especially tropical varieties. A target of
35% stalk fibre content is achievable and some
medium-yielding temperate varieties already
have that. Breeding these characteristics into
late flowering plant (tropical) varieties is very
possible and would mean an increase in stalk
value of AU$538-620/t at present pricing
structures.
Separate to the issue of plant breeding
and increasing the fibre content in stalk is the
issue of the value of the two main products.
To that end, it is entirely possible to attain an
additional AU$150/t (+AU$450 =
AU$600/t) for the hurds if product and mar-
ket development is implemented sooner
rather than later. Table 6.1 shows the effect
of the fibre to hurd ratio in relation to poten-
tial prices for product. Five different price
structures illustrate the point of higher bast
yields. Tonnes yield per hectare does not
enter into this equation but does play a major
part in grower returns.
•
Plant breeding for higher biomass
•
Better agronomic systems, planting,
watering
Targeted plant nutrient systems
Lower cost of production in harvesting
and handling to mill (PW System)
•
•
Reduced crop harvest loss/waste.
Before one can appreciate the efficiencies
that the handling and processing system
developed by Philip Warner (PW) can
achieve, one must understand the farm-to-
market processing and handling system cur-
rently used by most companies worldwide.
It will also be imperative that hemp production
is promoted to farmers on its additional bene-
fits such as:
•
Low risk for crop loss
•
Rotation benefits
