December 5, 2022

Colorado Department of Agriculture fails to secure funds for hemp processing equipment

A $5 million request from the Colorado Department of Agriculture to purchase hemp processing equipment has been denied, according to a Westword report. The agency had hoped to split the funds among three private companies for hemp-husking operations, on the condition that each company match state funding for building the facilities.

The Department of Agriculture had applied for funds from the state’s Marijuana Cash Fund, which is intended for state programs related to legal and commercial cannabis. Subsequent attempts to secure funding from other state sources, including a proposal to reduce the budget for the shellers grant to less than $2 million, were also denied, the report said. Without the funds, the proposal did not receive a legislative sponsor or make it into the budget bills.

According to the department, as of last November, Colorado had only one operating dehuller, and agency officials believe there are only two more in the country. The machines are not made in the USA. Building a hemp processing plant with a huller can cost between $600,000 and $3 million, according to the CDA.

In 2019, Colorado led the nation in recorded acreage for hemp cultivation, but that fell 42% from 2019 to 2020, according to state Department of Agriculture figures presented by Westword, and is expected to drop further.

A proposal for hemp shelling subsidies or business incentives could resurface next year if promoters find funding outside of the Marijuana Tax Cash Fund.

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