BILL ANALYSIS
SENATE AGRICULTURE & WATER RESOURCES COMMITTEE
Senator Jim Costa, Chairman
BILL NO: AB 388 HEARING: 5/7/02
AUTHOR: Strom-Martin FISCAL: Yes
VERSION: 2/27/02 CONSULTANT: Emily
Fraciskovich/
Dennis
Albiani
Specialty or Alternative Fiber Crops.
BACKGROUND AND EXISTING LAW
Since its founding, America has been a leading producer of fiber
crops. Industrial hemp, now considered a specialty fiber crop,
was grown domestically for hundreds of years prior to it's
prohibition. Other specialty fiber crops produced in the United
States include kenaf and flax. Flax, from the Linaceae family,
is a dicotyledonous shrubby plant whose stem can be spun into
linen thread. The stalk of Hibiscus cannabinus, or the kenaf
plant, is also harvested to produce fiber. In 1970, the United
States placed a prohibition on the harvest industrial hemp.
Although industrial hemp could not be harvested, the national
prohibition still allowed industrial hemp to be processed and
sold. On October 9, 2001 the Drug Enforcement Administration
(DEA) published an interpretive rule banning hemp seed and oil
food products that contain any amount of trace
tetrahydroconnabinol (THC). THC is the psychoactive organic
compound found in the Cannabis Sativa L. species. Although
industrial hemp contains less than 0.3% THC, it was still
subject to the DEA's ban. The courts eventually ruled to stay
DEA's ban on hemp seed and oil food products. On March 7, 2002,
a 9th Circuit Court Order ruled to extend the stay. In recent
years, Hawaii, North Dakota, Minnesota, Arkansas, Kentucky,
Illinois, Maryland, New Mexico, and Montana have passed
legislation legalizing the cultivation of industrial hemp.
Today, imported industrial hemp products are being sold legally
in the United States, creating an estimated $50 million market.
Industrial hemp has a multitude of commercial applications, and
demand for those products has resulted in the U.S. becoming the
largest importer of foreign-grown hemp-based materials in the
world. Federal and state laws have prevented American farmers
from producing for this market. Although the industrial hemp
processing industry has prospered in recent years, domestic
industrial hemp production is still in its infancy. Economic
uncertainties still surround the country's industrial hemp
producing potential.
AB 388 -- 2/27/02 -- Page 2
PROPOSED LAW
This bill would request that the University of California study
the economic potential for growing specialty or alternative
fiber crops including industrial hemp, kenaf, and flax.
This bill would request the University of California to assess
issues pertaining to production, processing, marketing, and
potential barriers to profitability.
This measure also request that the findings of the report be
delivered to the Assembly Committee on Agriculture and the
Senate Committee on Agriculture and Water Resources.
COMMENTS
1.By increasing domestic alternative fiber crop production such
as industrial hemp, American producers could potentially tap
into a $50 million market. Proponents of specialty fiber
crops state that industrial hemp is one of the strongest
natural fibers available. For example, industrial hemp can be
processed into various products from rope and twine to
high-end fabrics for clothes. Additionally, industrial hemp
food products are a small but fast-growing sector of the
natural foods industry, with annual sales of approximately $5
million. Products include pretzels, chips, energy bars,
bread, salad dressing, cereal, cooking oil and ice cream.
These products and many others are examples of the potential
markets that domestic industrial hemp producers could fill.
2.Since the legal proceedings regarding a ban on industrial hemp
products is not yet settled, California may be acting
prematurely by requesting a study of the economic viability of
industrial hemp production. The DEA may choose to pursue a
nationwide ban on industrial hemp products. If the DEA
chooses to ban industrial hemp products the study's findings
related to industrial hemp would have little or no use.
3.Proponents of the measure state that alternative fiber crops
such as industrial hemp have the potential to become effective
rotational crops. Industrial hemp is a hardy plant that
grows in most climates up to 16 feet in 70 days, shading out
weeds, thereby, reducing the need for agricultural chemical
inputs. After harvest, industrial hemp leaves a field with
fewer weeds to eliminate for the next crop.
AB 388 -- 2/27/02 -- Page 3
4.States rights advocates have been urging the U.S. Department
of Agriculture (USDA), Drug Enforcement Agency (DEA) and
Congress to revise policies regarding industrial hemp to be
less restrictive and to allow states to establish regulatory
programs, thereby fostering the development of domestic hemp
production by American farmers and manufacturers.
5.In addition to studying issues pertaining to potential
barriers to profitability for specialty or alternative fiber
crops, the committee may wish to consider having the
University of California assess the legal barriers associated
with growing and harvesting crops such as industrial hemp. In
addition to reporting its finds to the Assembly Committee on
Agriculture and the Senate Committee on Agriculture and Water
Resources, the committee may wish to have the University of
California report its findings to the Department of Food and
Agriculture as well.
PRIOR ACTIONS
Previous actions not relevant to this version of the bill.
SUPPORT OPPOSITION
San Francisco Board of Supervisors None received.
16 Individuals