The Cost of Hemp Cultivation: A Case Study of Connecticut Farmers in 2020

Written by Petar Petrov

As a late entrant in the cannabidiol (CBD) hemp space, the Connecticut Department of Agriculture legalized hemp cultivation in May 2019. A report from February 2020 aimed to assess the current state of Connecticut’s hemp market and predict its near future.

The report’s release date incidentally makes for an extra insight, as it’s just before the coronavirus outbreak, therefore, it would be interesting to juxtapose the report’s findings and predictions with the actual reality. a\5EW

Due to the novelty of the state’s hemp space, the report employed two complementary methods to make up for the lack of historical data – economic engineering, based on simulating hemp production’s best practices, and interviews with farms and experts from Connecticut, Massachusetts, and New York.

The simulated best practices spanned seedings, land preparation, transplanting, post-planting irrigation, post-planting fertilization, roguing (identifying and removing plants with undesirable characteristics), pest management – which included weeds, vertebrates, insects and mites, and diseases), harvest – which involved pre-harvest testing, chopping, drying, debudding, transportation, post-harvest cleanup, yields, returns, and sales and marketing.

The report used a representative farm of 10 acres that obtains 2,500 pounds of dry flower with 6.5% total CBD.

The total cost per acre was estimated at $19,289 or $7.72 per pound of dried hemp flower. Roughly 1/3rd of that cost was fixed, whereas the other 2/3rds were variable, as in dependent on the level of production. The fixed costs included the land and building costs as well as a drying facility and regulatory expenses. The variable costs included things like seeds, fertilizer, crop inputs, labor, and fuel.

Going by a 2,500-acre farm, the “prevailing” local price of flower at $1.50 per percentage point, and the 6.5% CBD contents, total revenues per acre were projected at $24,375, which would result in $5,086 profits per acre.

Naturally, individual farmers’ and CBD prices would also factor in and add some variability into the equation of future profitability.

Moreover, as CBD becomes more mainstream, its production expands, and as a result, its prices go down, “policy challenges remain to ensure the long-term profitability and economic viability of CBD hemp production in Connecticut.”



[1] Jelliffe J, Lopez R, Ghimire S. Hemp production costs and returns for Connecticut farmers in 2020. Outreach Report No. 66, Zwick Center for Food and Resource Policy Department of Agricultural and Resource Economics, University of Connecticut, Times Cited = 3

Image Credits: Nick Youngson CC BY-SA 3.0 Pix4free

About the author

Petar Petrov

Petar is a freelance writer and copywriter, covering culture, art, society, and anything in-between that makes for a nice story. And as it so happens, cannabis is a great element to add to each of those conversations.

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