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Despite hemp farming being a relatively new sector of the agriculture industry in the state, South Dakota has managed to become one of the largest producers of industrial hemp in the United States.

With much debate regarding hemp production in recent years in the state legislature, the 2024 session brought industry representatives and lawmakers working together.

鈥淚t was the first year that the South Dakota Department of Agriculture and the governor's office were not in opposition to our legislation. So that was huge,鈥� Katie Sieverding, executive director of the South Dakota Industrial Hemp Association, said. 鈥淲e're really grateful we have a great working relationship with the South Dakota Department of Agriculture and so this year was just a lot of fun. We didn't have to work against them and in the legislative arena, with our legislators.鈥�

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One goal the hemp industry accomplished this session was bringing state regulations in line with the U.S. Department of Agriculture regulations regarding the remediation of crops.

鈥淩ight now, our regulation says that if you're above 0.5% THC on your test, you can't do anything. You can't remediate it, you can't let it dry and then retest it. You have to just destroy it. But the USDA allows for up to 1%. It still has to go back down below 0.3% before it can enter into commerce and be used,鈥� Sieverding said. 鈥淲e just found that a couple of varieties were over that 0.5% in the field, but then when you lay them down and let them dry out, they fall below that 0.3% again. So that was a big thing.鈥�

Another issue in the hemp industry has been producers growing hemp for both grain and fiber, then selling the grain but storing fiber bales. If producers choose not to grow hemp and don鈥檛 obtain a hemp license for the next year, it makes it unlawful for them to still have those fiber bales in storage.

鈥淪o we made a definition and created some language that says that the hemp stock bales, and these are just for grain and fiber, the fiber varieties are products,鈥� Sieverding said. 鈥淪o they no longer require a license, once they're in the form of a bale. If your neighbor wants to use the bale for bedding, you can sell it to them, or you can use it on your own farm and you wouldn't have to keep your growers license active to do that.鈥�

The state also changed the processor licenses to be issued for up to three years, while still requiring an annual licensing fee. This decision allows for mitigating risk when processors are applying for resources such as loans.

Other issues tackled during the session included allowing for electronic background checks for in-state residents and changing the requirements for background checks to up to every three years.

鈥淲e're finding those little things out as the industry matures in the state,鈥� Sieverding said.

Sieverding has been with the association since its formation in the spring of 2020 when her company started lobbying for the industry after the hemp bill was signed by Noem that same year.

The association is made up of producers, processors, suppliers and retailers. There are also options for those involved in banking or insurance to join as well as an associate membership which is a nonvoting member that wants to learn more about the industrial hemp industry.

In 2023, the state planted a total of 3,127 acres of hemp for both grain and fiber production.

Ken Meyer, president of the South Dakota Industrial Hemp Association, says that the majority of those acres are focused in the Wessington, South Dakota, and Woonsocket, South Dakota, areas and then continues to spread in smaller amounts throughout the state.

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鈥淲hat we have seen is that as soon as there are sizable acres in an area, a lot of farmers take interest and we get a lot of inquiries the next year,鈥� Meyer said. 鈥淭he overall retention of farmers that have started to grow hemp and continue on is about 80%.鈥�

Producers are able to start farming hemp using the same equipment they already have for growing corn, soybeans and making hay. Meyers says many farmers are finding the plant to be 鈥渁n excellent cash row crop to put in rotation with their corn and soybeans.鈥�

One issue the industry faces is the need for processing facilities to allow for a better market for hemp producers. Currently, Complete Hemp Processing Facility in Winfred, South Dakota, is the only processing plant in the state. This need will be answered with the completion of the second processing facility next year.

鈥淲e will also see a modest increase in acres so I think we'll come in at about 4,000 acres, maybe a little more for this year,鈥� Meyer said. 鈥淏ecause of the processing, we have not been able to take on large acres more than what we've done in the past. But, as the processing continues to build and be put in place, we can take on more acres. We have more people wanting to plant hemp than we can handle with our current processing.鈥�