‘Farming resilience, achieving net zero, and how industrial hemp...’ Minutes 12.07.23
8th Meeting
10.30am Wednesday 12th July 2023
Present
Crispin Blunt MP
Ronnie Cowan MP
Jonathan Edwards MP
Allan Dorans MP
Lord Mancroft
Elizabeth Osgood – Defra
Amanda Lyons – Defra
Nick Joyce – GRWN Group
Dan Houseago – Jersey Government
Tarsilo Onuluk (Office of Crispin Blunt MP)
Freddie Boase (Office of Crispin Blunt MP)
Nick Morland – Tenacious Labs
Andy Cutbill – Tenacious Labs
Alex Markland – Tenacious Labs
Sian Phillips – CTA
Marika Graham-Woods – CTA
Tony Reeves – EIHA
Jamie Bartley – CIC
Mike Morgan-Giles – CIC
Rebekah Shaman – BHA
Alex McLeod – IndiNature
Marcus Morely-Jones – Ecoversity
Eoin Keenan – Goodrays
Heather Oldfield – Elsoms Seeds
Adrian Hayler – Elsoms Seeds
Sama Cannon – CIC
Hadleigh Hobbs – Wellspring Homes
Pierre Gregorian – Wellspring Homes
Stephen Wong – Rare Earth Global
Suneet Shivaprasad – Rare Earth Global
Jamie Lewis – Rare Earth Global
Peter Schwartz – Jibe Consultants
Ricardo Gaeda – Lawrence Stephens
Philip Elbourne – P3P Partners
Minutes
APPG co-chair Crispin Blunt MP, welcomes the room, and remarks on the growing interest in the APPG and its activities from all parts of the industry.
Crispin especially welcomes Elizabeth Osgood, Head of Arable for Defra, and Amanda Lyons, Senior Policy Advisor to Defra, introducing them to the room, and inviting them to talk on the subject of ‘Farming resilience, achieving Net Zero, and how industrial hemp can help us get there’- the title of the meeting.
Elizabeth Osgood, Head of Arable for Defra and Amanda Lyons, Senior Policy Advisor to Defra, first speakers:
Elizabeth begins by explaining her and Amanda’s roles within the arable team which is situated within the farming and primary processing division of the Agri-Food Chain Directorate. She highlights the teams they work alongside, including red meat and dairy, pigs, eggs and poultry, horticulture, and others.
She introduces Defra's four priority outcomes, emphasizing the focus on improving the environment, reducing greenhouse gas emissions, mitigating flooding and coastal erosion, and enhancing sustainability, productivity, and resilience in the agriculture and food sectors.
She talks about the UK's commitment to reaching Net Zero emissions by 2050. While the Department for Energy Security and Net Zero leads the government's Net Zero efforts, Defra plays a crucial role in reducing emissions from agriculture, land use, and waste while increasing carbon savings through forestry and peatland policies.
The Net Zero Growth Plan is explained, which outlines Defra's ambition to reduce emissions from their sectors, contributing to an overall 78% reduction across the economy.
Government initiatives, such as the new environmental land management (ELM) schemes, are highlighted as powerful tools for achieving Net Zero and broader environmental goals, while supporting the rural economy.
The importance of a significant increase in investment to achieve Net Zero is emphasised. The speakers stress that farmers and land managers can earn income from public sources like ELMS while attracting private sector finance for carbon sequestration, water quality improvement, and biodiversity enhancement.
Nature-based solutions like restoring peat and planting trees are discussed as key strategies for addressing climate change and its impacts. They are highlighted as essential components of the climate and biodiversity crisis response.
The dependence on a few crops (wheat, barley, and oilseed rape) in the UK's agri-food systems are identified as a potential risk to food security and agricultural resilience. The need to identify economically viable alternatives that enhance cropping system diversity is stressed.
The potential of industrial hemp as a reintroduced crop with known value as a fibre crop is recognised. Although its environmental benefits have not been fully understood in the past, it is now considered a valuable crop, says the speakers.
Specific benefits of industrial hemp, including carbon capture, reduced fertiliser needs, and natural weed suppression, are mentioned as factors that could contribute to achieving Net Zero goals.
The speakers acknowledge that government support schemes and strategies do not currently mention specific crops, but industrial hemp could play a key role in delivering their ambitions and commitments.
The importance of exploring the introduction of novel or underutilized crops into farmers' rotations is emphasized, particularly as a break from intensive cereal production.
The arable team's efforts to make it easier for farmers to grow industrial hemp are discussed. They acknowledge the importance of farmers' choices based on their knowledge of their land and soil types.
Collaboration with the National Institute of Agricultural Botany (NIAB) and other government departments to build an evidence base for industrial hemp and ensure funding for relevant projects are highlighted as important.
The speakers mention working with the Home Office officials to improve the licensing system for industrial hemp, addressing concerns and removing barriers for farmers.
Funding opportunities and support for research and development of industrial hemp are discussed, particularly through the Farming Innovation Programme, which aims to benefit farmers, growers, and foresters.
The success of the CHCx3 project securing funding for ambitious research on climate-smart farming, with hemp playing a prominent role, is brought up. The speakers express department-wide excitement for the potential of this research.
They acknowledge the commitment of Minister of State for Food, Farming and Fisheries, The Rt Hon Mark Spencer MP to improve the licensing experience for farmers growing industrial hemp, along with active efforts from Ministers and officials to address concerns and reduce barriers to entry.
The speech concludes with gratitude for the support of the audience and a willingness to take questions, expressing hope that industrial hemp can and will contribute to achieving Net Zero goals with the enthusiasm of farmers and experts in the industry.
NB During the speech, it becomes clear that the meeting has become quorate with parliamentarians Crispin Blunt MP, Ronnie Cowan MP, Jonathan Edwards MP, Allan Dorans MP and Lord Mancroft present, and so Crispin Blunt briefly takes the opportunity for the meeting to fulfil its ECM duties in confirming Ronnie Cowan MP’s new role as co-chair of the APPG. The vote is taken and passed. Ronnie Cowan MP was welcomed as a new co-chair of the group.
Next Crispin Blunt MP welcomes Nick Joyce, MD of GRWN Group, and gives him the floor.
Nick Joyce, MD of GRWN Group, second speaker:
Nick thanks the APPG for the opportunity to speak on behalf of the UK hemp industry.
GRWN Group, he says, is an industrial hemp company based primarily in the south of England, with plans to open a processing facility in Q4 2024 to manufacture hemp-based products.
Nick’s speech emphasizes the increasing need for sustainable farming and combating climate change, leading more farmers to add hemp to their crop rotations.
Hemp, he says, is recognised as a powerful tool in tackling the adverse effects of climate change and an essential economic driver for the UK.
The benefits of hemp are highlighted at different stages of the value chain, he says, from cultivating hemp for seeds and biomass to processing hemp fibres into building insulation and hempcrete.
Nick highlights the potential for improving hemp licensing to lead to an additional 220,000 hectares of hemp cultivation in the UK by 2027 and estimates the potential of hemp biomass to generate £1.5 billion in additional income for UK farmers.
The positive economic impact of a thriving hemp and cannabis industry on the UK, including job creation, tax revenue, and environmental benefits, is outlined, and several successful hemp businesses, including IndiNature, Hemspan, and Adaptavate, are given as examples of the exciting growth in the UK hemp industry.
Nick’s speech acknowledges the challenges faced by the industry, including licensing issues and the lack of clarity around The Proceeds of Crime Act of 2002.
The need for a simplified and farmer-friendly licensing pathway to unlock the industry's potential is stressed, as is the urgency of reforming The Proceeds of Crime Act of 2002 to provide legal clarity and confidence for potential investors.
Nick highlights the chronic lack of funding available for those looking to utilise and exploit the benefits of industrial hemp, stressing the challenging capital requirements of the entire supply chain, including farming equipment and industrial machinery.
The potential for the UK government to support the industry's growth, create jobs, and increase tax revenues by providing increased investment and enabling the industry is strongly emphasised. The UK industrial hemp industry is at a critical junction, Nick says, with huge ambition evident to meet the growing opportunity.
Finally Nick adds that the government needs to listen and take action to support the industry's growth. With this in mind, Nick expresses his and other business leaders’ willingness to provide advice and work with the government to implement positive change.
Nick concludes the speech, thanking the audience, telling them he looks forward to working together in the future.
Questions
Crispin thanks Nick for his words, and asks Elizabeth Osgood and Amanda Lyons, off the record so that can speak freely, where Defra stands on changing the existing, not-fit-for-purpose hemp licensing.
Elizabeth’s off the record answer implies that Defra is supportive of the APPG’s position on licensing and is working with the Home Office to sort the issues. She says that Defra would welcome collaborative input from the APPG regarding those discussions. She also mentions that it is now becoming easier for farmers to gain access to funding for growing hemp, and that any farmers thinking of doing so, should get in touch direct with her team at Defra.
Marcus Morley-Jones from Ecoversity asks whether a licensing exemption, particularly in academia, might be possible. Amanda thinks it unlikely, but reiterates Defra’s work in trying to make the licensing regime easier for all.
Jamie Bartley, MD of Unyte Group and co-chair of the Cannabis Industry Council (CIC) asks a question regarding carbon audits and Defra’s commitment to supporting farmers by 2024. Would there be an opportunity, he asks, for consultation regarding the metrics and methodologies as they are being developed. Elizabeth replies she isn’t sure, but thinks there will indeed be consultation, and says she will make sure the arable team are involved. She also mentions the matter will need picking up with the specific team directly.
As a point of note, James Bartley also mentions that in a recent discussion with Minister for Crime, Policing and Fire, the Rt Hon Chris Philp MP, the minister and civil servants seemed open to exploring industrial uses of the whole plant. Current restrictions on using the whole plant are a big barrier to farmers growing hemp, says Bartley, as flower and seed easily get into the fibre harvesting process. The worry of criminalisation puts farmers off growing at all, he says. He understands that this would not need primary or secondary legislation, just a change in the guidance.
Crispin thanks Jamie Bartley and moves on. He asks Alex McLeod, CEO of IndiNature, for his question. Alex states that selling hemp insulation into the construction market is determined by regulation. Current regulation, he says, does not value ‘embodied carbon’. 29milion UK homes are in current need of retrofitting with insulation in order for the UK to meet its Net Zero commitments, he says. However, because curent UK regulations do not value embodied carbon, those houses are currently likely to be retrofitted with petrochemical-based insulation. This position is effectively inhibiting the pace at which the hemp insulation market can grow. It is an opportunity, he says, for the UK to take millions of tons of CO2 out of the atmosphere. It is being missed. The construction industry will not do this itself, Says Alex McLeod. Do Defra work with other departments (e.g. construction) around such regulation, he asks?
Elizabeth Osgood says Defra are working with other departments and is aware of the potential carbon capture. Defra are happy to have conversations with the insulation industry to talk about the evidence they have, so Defra can go to BEIS (or new equivalent department) and present the key information they need to be thinking about.
Rebekah Shaman from the British Hemp Alliance, says that with the increasing demand for industrial hemp from insulation and other industries, industrial hemp is being imported from other countries (due to its lack of production in the UK). This negates the carbon benefits of using it in the first place. It has to be local in order to keep its carbon negative credentials. The opportunity of nurturing a thriving hemp-growing industry in the UK is being lost. Does Defra understand the urgency, she asks. Elizabeth Osgood says they are working hard to sort the licencing problems out.
Alex Sparrow from UK Hempcrete says that he has spent 15 years building homes, offices and commercial buildings using hemp. He sees a huge demand in the UK and further afield for Net Zero buildings, and a increasing demand from the sector for farmers to grow the crop. He says the key objective must be to separate industrial hemp from high THC cannabis within the Drugs Licensing Act. Without that, the private finance and investment will not come in to build the infrastructure that’s needed to support a growing industry due to investors’ fears of getting caught out by an out-of-date Proceeds of Crime Act (POCA).
Jonathan Edwards MP, Welsh MP for Carmarthen East and Dinefwr, says that he’s been asked why more farmers aren’t growing hemp in Carmarthenshire when it’s a recognised way of diversifying a farming business and making it more sustainable. He knows that the Welsh government are funding trials through Aberystwyth University, but asks of the status of discussions between the Welsh government and Defra on this issue. He also asks whether it would help Defra to have the Welsh government at their side when discussing licensing changes with the Home Office.
Amanda Lyons thanks Jonathan Edwards MP, and says she will speak to Welsh colleagues regarding the matter.
Backing up Alex Sparrow’s earlier point, Adrian Hayler from Elsoms Seeds says that he is aware of very interested investors looking into this sector, but at the due diligence stage, they back off as there are less risky ways of investing their money (due to POCA). Likewise, the directors at Elsoms are wary of investing in multiplying hemp seed stocks when the licensing and investment environment are so difficult. “No seeds, no crop, no growth in the UK sector” he points out.
Crispin brings the discussion to a close. There is an absence of public policy arguments against these issues, he points out, and stresses that parliamentarians should therefore be asking why the changes demanded are not happening. If MPs are largely keen to pass this legislation, why has it not been drafted, he asks. Everyone needs to push all the gov department that have an interest in this space, he continues.
Crispin thanks Nick Morland and Andy Cutbill of the secretariat for bringing all these people together, and of bringing in senior members of Defra to make comment. He ask Nick Morland of Tenacious Labs to speak.
Nick Morland, CEO of APPF secretariat Tenacious Labs, reports recent secretariat activity. He talks about POCA holding up investment, as it makes investors nervous. Changing POCA is crucial, he says. He talks about successfully helping Jersey change their POCA legislation, all while being watched by the UK HO, and the positive lessons learned. Not a rewrite, just the amending of few lines, he says. He talks about a conversation with Welsh NFU, and Welsh farmers needing to grow carbon-capturing trees in order to become legible for various grants. Farmers are struggling due to the poor tree growing topography he says. Hemp would be an ideal alternative, he continues, and sequesters more CO2 anyway. The conversations are easy he says – everyone has done their homework, it makes sense, and is uncontroversial. The process stands in the way of the thousands of jobs and additional tax a UK hemp industry would create. It’s not moving, and something needs to be done, he says.
Crispin agrees saying that it is now the MPs’ job to get this done. He thanks all for the positive engagement, and to Defra for talking, mentioning he knows that the top seniority in Defra (the Rt Hon Lord Benyon and Minister of State, the Rt Hon Mark Spencer MP) are very sympathetic, especially on the licensing side.
Finally Marika Graham Woods, Executive Director of the Cannabis Trades Association (CTA) brings up the issue of levels of THC in crop. Crispin says that he received her letter (attached), and that the management of levels of THC should be discussed in the next meeting, on Tuesday 12th September.
Tony Reeves from the European Industrial Hemp Association (EIHA) asks whether Natasha Smith, Deputy director of the Food Standards Agency might come to next meeting. Crispin thinks it’s a good suggestion and asks Andy Cutbill to see what he can do.
The meeting ends at 11.03am
Email from Marika Graham Woods, Executive Director of the APPG to APPG and secretariat, dated 11.07.23:
Dear Officers of the APPG and Secretariat.
I have been asked by CTA members and the CBD Sector to bring this matter to your attention. The Cannabis Trades Association (CTA) represents over 70% by volume of CBD producers and CBD consumer product manufacturers and distributors operating in the UK.
The legitimate CBD Products Sector in the UK, estimated in the Parliamentary APPG CBD Report (2022) to be worth ca £2 Billion and around 39,000 jobs and £400M in Tax Revenues by 2025, is now is steep decline due to the Food Standards Agency Novel Foods Process for CBD Products, which has suppressed innovation, white-labelling, sector growth, investment, and halted mergers and acquisitions, without a single UK application being `Approved’ since the NF process began in 2019!
In the absence of an agreed `safe level’ for CBD products in the UK containing THC (at such low levels – currently under 0.2% THC where there is NO narcotic effect) and 4 years since the FSA Novel Foods process begun in 2019, the luxury CBD sector in the UK is in freefall decline with over 40% of SMEs and Retailers of CBD & Wellness products going out of business in the last 18 months.
The ACMD report published in December 2021, with limited CBD industry input, provided a foundation for a review aimed at agreeing safe, practical, and science-based levels of controlled cannabinoid in CBD products, to assure consumer safety, whist preserving consumer choice and supporting the (then) growing UK CBD industry. Subsequent ministerial changes in Westminster have undoubtably contributed to the slow progress of the process too, however, over-long delays within the FSA Novel Food process are now threatening the UK CBD industry.
Tests are currently underway regarding safe limits of CBD as a foodstuff conducted by EIHA. The ACMD Report is undergoing review at the Home Office. Whilst the ACMD report is under review, we request a sensible `holding position’ by UK Government, ministries and the FSA regarding CBD food products now be applied.
The UK CBD industry requests that UK authorities now apply the Swiss values for THC (in relation to consumer safety) based on proper scientific processes, and sound safety parameters.
The Swiss approach is based on ARfD (Acute Reference Dose) of 490 microgram/average adult or 0.49mg THC per day/adult. These `safe consumption’ levels were established by the Swiss Federal Office of Public Health in 1995, and in over 30 years, NO adverse effects have been reported!
Our trade body colleagues in the EIHA Consortium, are currently conducting the first comprehensive clinical study of THC toxicity involving 400 healthy adults and this is widely predicted to support a tolerated daily intake of THC of at least that set by Switzerland.
In adopting the Swiss approach and levels supporting consumer safety, the FSA and UK Government will be able to continue to balance public & consumer safety concerns, while allowing for the responsible consumption of CBD food products containing low levels of THC. Adopting this interim position will allow the UK CBD sector to once more flourish, whilst reducing costs and the manpower required by the FSA in the regulation of CBD products under the Novel Food process.
We ask the Officers of the APPG Industrial Hemp and CBD, to table a meeting in the autumn of 2023 with the aim of bringing this urgent matter to the attention of Ministers and MPs.
Yours truly,
Mrs Marika Graham-Woods
Executive Director
Cannabis Trades Association (CTA) and Hemp Trades Association (HTA)
