Business & Real Estate

‘This crop will change California.’ Can an Oakdale group make hemp a major cash crop?

Jeff McPhee hold hemp seeds from Colorado in Oakdale California on March 8, 2019.
Jeff McPhee hold hemp seeds from Colorado in Oakdale California on March 8, 2019.

California’s Central Valley is already the bread basket for the nation. But now a new Oakdale company — in partnership with the University of California, Davis — wants to help make it the hemp capital of the country.

The California Hemp Corporation was formed by Oakdale residents Jeff McPhee and Kent Kushar last year and has entered into a sponsored research agreement with UC Davis to study how the plant grows in the valley. Like its more famous cousin marijuana, hemp is a species of cannabis plant — but lacks enough THC to produce pot’s high.

Instead hemp has a long agricultural history in the United States, and was even famously farmed by President George Washington. Over the years it has been used in everything from clothing, rope, cosmetics, construction and food.

“We want to grow hemp up and down the San Joaquin Valley, just like every other one of our crops,” McPhee said. “This crop will change California.”

With the expansion of the recreational and medicinal marijuana markets across the county, including in California, hemp has been looked at more for CBD production. CBD, the other, non-psychoactive compound in cannabis, has been hailed for its wide-ranging medicinal benefits.

McPhee said the company is most interested in growing hemp for its CBD, which then can be used in everything from creams to tinctures, food and drinks.

The research project will begin with “a couple hundred acres” of hemp planted this season in fields in Lemoore, south of Fresno. The study will see how hemp grows outdoors in Central Valley conditions, using California’s advanced irrigation and growing techniques. The genetics of the plant also will be studied, to understand how to best scale it in the state as an agricultural crop.

McPhee has a background in farming and masonry, and his business partner Kushar has worked for 20 years at E.&J. Gallo Winery as its Chief Information Officer. At UC Davis the research project will be led by Edward Charles Brummer, the director of the Plant Science Department. The long-term, 10-year study is considered the first significant cannabis research project initiated by the University of California system.

“It will be among the first significant hemp breeding programs of its kind, for what may be the most important crop in a generation,” Brummer said in a statement about the project. “It will also be our first use of groundbreaking breeding technology, which we believe has the potential to become the standard for the next generation of breeding professionals.”

Hemp cultivation is currently regulated by the California Department of Food and Agriculture. But unlike traditional crops, it can’t just be planted freely yet. The Oakdale company’s grow has been approved as part of the research agreement.

McPhee said the results of the research project will help farmers learn how to grow hemp in the valley, and the benefits of growing the crop. But regulations aren’t the only thing McPhee and Kushar are fighting with their hemp company. Hemp’s connection to marijuana — the two plants look and smell very similar — has been hard to shake.

“We have to distance ourselves from the stigma of the marijuana plant. We want more people to understand that hemp has little to no THC and understand CBD’s benefits,” McPhee said.

He said he wants to help educate California farmers about hemp, CBD and its agricultural potential. A report published last year by the Brightfield Group, a cannabis and CBD market research firm, said the global hemp market could reach $22 billion by 2022.

“It’s going to be grown, everyone will be coming out of the woodwork in the next few years wanting to plant this stuff,” McPhee said.

Marijke Rowland writes about new business, restaurant and retail developments. She has been with The Modesto Bee since 1997 covering a variety of topics including arts and entertainment. Her Business Beat column runs multiple times a week. And it’s pronounced Mar-eye-ke.
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