Finished hemp, marijuana's non-intoxicating cousin, is legal in the US, but growing it remains off-limits under federal law

Ryan Loflin, a farmer from southeast Colorado, tried an illegal crop this year. He didn't hide it from neighbors, and he was never afraid that law enforcement would come asking about it. Loflin is among about two dozen Colorado farmers who raised industrial hemp, marijuana's non-intoxicating cousin that cannot be grown under federal drug law, bringing in the nation's first acknowledged crop in more than five decades.

Emboldened by voters in Colorado and Washington last year giving the green light to both marijuana and industrial hemp production, Loflin planted 55 acres of several varieties of hemp alongside his typical alfalfa and wheat crops. The hemp came in sparse and scraggly this month, but Loflin said he is still turning away buyers.

"Phone's been ringing off the hook," said Loflin, who plans to press the seeds into oil and sell the fibrous remainder to buyers who will use it in building materials, fabric and rope. "People want to buy more than I can grow."

Hemp's prospects, however, are far from certain. Finished hemp is legal in the US, but growing it remains off-limits under federal law. The Congressional Research Service recently noted wildly differing projections about hemp's economic potential.

However, America is one of hemp's fastest-growing markets, with imports largely coming from China and Canada. In 2011, the US imported $11.5m worth of hemp products, up from $1.4m in 2000. Most of that is hemp seed and hemp oil, which finds its way into granola bars, soaps, lotions and even cooking oil. Whole Foods Market now sells hemp milk, hemp tortilla chips and hemp seeds coated in dark chocolate.

Colorado will nt start granting hemp-cultivation licenses until 2014, but Loflin didn't wait. His confidence got a boost in August, when the US Department of Justice said the federal government would generally defer to state marijuana laws as long as states kept marijuana away from children and drug cartels. The memo did not mention hemp as an enforcement priority for the Drug Enforcement Administration.

"I figured they have more important things to worry about than, you know, rope," a smiling Loflin said as he hand-harvested 4ft plants on his Baca County land.

Colorado's hemp experiment may not be unique for long. Ten states now have industrial hemp laws that conflict with federal drug policy, including one signed by California Governor Jerry Brown last month. And it's not just the typical marijuana-friendly suspects: Kentucky, North Dakota and West Virginia have industrial hemp laws on the books.

Derek Cross, a chef who specializes in cooking with hemp, demonstrates the burning properties of hemp oil, which he touts as a digestible bio fuel. Photo: Kristen Wyatt/AP

Hemp production was never banned outright, but it dropped to zero in the late 1950s because of competition from synthetic fibers and increasing anti-drug sentiment. Hemp and marijuana are the same species, cannabis sativa, cultivated differently to enhance or reduce marijuana's psychoactive chemical, THC. The 1970 Controlled Substances Act required hemp growers to get a permit from the DEA, the last of which was issued in 1999 for a quarter-acre experimental plot in Hawaii. That permit expired in 2003.

The US Department of Agriculture last recorded an industrial hemp crop in the late 1950s, down from a 1943 peak of more than 150m pounds on 146,200 harvested acres.

Loflin and other legalization advocates say hemp is back in style and that federal obstacles need to go. Loflin didn't have to hire help to bring in his crop, instead posting on Facebook that he needed volunteer harvesters. More than two dozen people showed up — from as far as Texas and Idaho. Volunteers pulled the plants up from the root and piled them whole on two flatbed trucks. The mood was celebratory.

But there are reasons to doubt hemp's viability. "It is not possible," Congressional Research Service researchers wrote in a July report, "to predict the potential market and employment effects of relaxing current restrictions on US hemp production."

The most recent federal study came 13 years ago, when the USDA concluded the nation's hemp markets "are, and will likely remain, small" and "thin". A 2004 study by the University of Wisconsin warned hemp "is not likely to generate sizeable profits" and highlighted "uncertainty about long-run demand for hemp products".

Still, there are seeds of hope. Global hemp production has increased from 250m pounds in 1999 to more than 380m pounds in 2011, according to United Nations agricultural surveys, which attributed the boost to increased demand for hemp seeds and oil. Congress is paying attention to the country's increasing acceptance of hemp. The House version of the stalled farm bill includes an amendment, sponsored by lawmakers in Colorado, Oregon and Kentucky, allowing industrial hemp cultivation nationwide. The amendment's prospects, like the farm bill's timely passage, are far from certain.

Ron Carleton, a Colorado deputy agricultural commissioner who is leading the state's looming hemp licensure, said he has no idea what hemp's commercial potential is. He is not even sure how many farmers will sign up for Colorado's licensure program next year, though he has fielded a "fair number of inquiries".

"What's going to happen, we'll just have to see," he said.