OT_169: Perrin Ag 'Potentially Hemp' (2023) — NZAGRC hemp land-use economics + compiled yield corroborator

OT_169: Perrin Ag 'Potentially Hemp' (2023) — NZAGRC hemp land-use economics + compiled yield corroborator

Source

https://www.ag-emissions.nz/assets/Alt-land-use-analysis/PerrinAg_Hemp-report.pdf — original source (opens in a new tab; the file is not redistributed)

Perrin Ag — “Potentially Hemp” (NZAGRC alternative-land-use analysis 4, March 2023)

Compiled land-use economics + a yield-range corroborator for OT_112's hemp seed figure — NOT a measured composition primary

Perrin Ag Consultants Ltd (Inness, M., 2023) for the New Zealand Agricultural Greenhouse Gas Research Centre (NZAGRC), Future Farm Systems Research Programme — the fourth in the alternative-land-use series. 34 pp. A grey-lit economic/land-use analysis of commercial hemp in NZ: consolidates the reported NZ hemp seed yield range (0–2,000 kg/ha, average ~800–1,000 kg/ha, cited to Tupu.nz/Marsh — compiled, not a trial), gross margins, on-farm IRR/CapEx, and the regulatory barriers. Retrieved direct from ag-emissions.nz; figures pdftotext-verified. The nutrition/protein table is USDA-borrowed — this source measures OIL context, not NZ hempseed protein.

Summary

An economic and land-use analysis of industrial hemp (Cannabis sativa L.) as a commercial alternative to pastoral/arable land use in New Zealand, prepared by Perrin Ag Consultants for the NZAGRC as the fourth report in its alternative-land-use series. Its focus is on-farm economics — hemp seed vs fibre gross margins, discounted-cashflow IRR and capital requirements at a 50 ha scale, and how hemp compares financially with dairy, sheep & beef, and milling wheat — plus the market and regulatory barriers (no secondary market, THC/Misuse-of-Drugs classification, food-standards limits). For Neobiome its value is twofold and bounded: (1) it corroborates the compiled NZ hemp seed yield range (0–2,000 kg/ha, avg ~800–1,000) that OT_112 also reports at 0.8–1.0 t/ha, and (2) it supplies CapEx / OpEx / gross-margin context for hemp as a land use. It is not a measured composition primary: its yield is drawn from secondary NZ sources (Tupu.nz 2022, Marsh 2020) and its Table 1 nutrition figures are USDA-sourced, not NZ-measured — so it firms yield central-tendency and economics only, never protein.

Key claims

- claim: "NZ hemp SEED yield range (compiled, cited to Tupu.nz 2022 + Marsh 2020, NOT a Perrin Ag trial): 'The limited literature available on hemp seed yields in New Zealand suggest yields range from 0 kg to 2,000 kg/ha with the average being around 800 – 1,000 kg/ha (Tupu.nz, 2022; Marsh, 2020). If yields drop below 800 kg/ha at a price of $5,000/t, a negative IRR can be expected.' The report also flags 'a large range of hemp seed yields reported in New Zealand making the average yield achieved currently achieved by growers difficult to ascertain.'"
  source_location: "§3 Hemp seed sensitivity analysis, p.16 (above Table 7); gross-margin limitations bullet, p.14"
- claim: "Nutrition / protein table is USDA-sourced, NOT NZ-measured. Table 1 'Comparing the nutritional value of different foods … Sourced form (USDA, n.d.)' gives hemp seed per 100 g: Protein 30 g, Carbohydrates 10 g, Total lipid fat 50 g, Total fatty acids 48 g (Monounsaturated 5 g, Polyunsaturated 38 g, Saturated 5 g). Text: 'Of particular note is the protein content of hemp relative to other sources of plant protein.' These are borrowed USDA reference values, not a New Zealand hempseed measurement."
  source_location: "§2 Marketing & awareness, Table 1, p.12"
- claim: "Hemp gross margins (Table 2, indicative, overseas-supplemented): hemp SEED gross margin $2,336/ha (revenue $5,000/ha = 1 t/ha × $5,000/t; total expenses $2,664/ha); hemp FIBRE gross margin $2,183/ha (revenue $4,800/ha = 10 t/ha × $480/t; total expenses $2,617/ha). 'With limited New Zealand-based literature and evidence relating to hemp seed and fibre crop revenue and expenses, overseas research was utilised to fill the gaps.' Literature spread: NZHIA (2022) reported grower gross margins NZ$1,000–$10,000/ha; Marsh (2020) reported seed NZ$1,500–$4,500 and fibre NZ$2,500–$4,000/ha."
  source_location: "§3 Hemp gross margins, Table 2 + notes, p.13"
- claim: "On-farm investment analysis (50 ha, 10-yr DCF, pre-interest-and-tax): hemp SEED initial capital $1,265,000, IRR 4.1%, annual net surplus $111,289; hemp FIBRE initial capital $877,500, IRR 6.7%, annual net surplus $103,639; milling WHEAT $456,850, IRR 12.8%, $79,700. 'The higher level of capital required to grow, harvest and store hemp seed was the main reason for hemp seed having a lower internal rate of return.' Hemp fibre needs a positive-IRR minimum of 41 ha (seed 43 ha); land value excluded (landowner assumed to already own the land)."
  source_location: "§3 Hemp seed and fibre on farm investment analysis, Table 3 (p.15) + Table 10 (p.20); Appendices 1–2 DCF (pp.31–32)"
- claim: "Operating surplus per hectare and dairy comparison: 'The operating surplus for hemp seed and fibre are $1,725 and $1,572 per hectare respectively. This compares with the mean operating profit (as measured by EBIT …) of $3,189 per hectare for New Zealand dairy farms in 2020-21 (DairyNZ, 2023).' Hemp sits above the mean NZ sheep & beef farm ($576/ha, 2019-20, Farm Facts 2021) and lower North Island class 5 finishing farms (EBITRm $1,287/ha, B+LNZ 2022)."
  source_location: "§3 Hemp compared to pastoral farming in NZ, pp.17–18"
- claim: "Hemp seed is oil-dominant; meal is the bulk fraction. 'The hemp seed meal, which comprises 75% of the entire seed, was not able to be used for human consumption' (pre-2017 food-standards context). By-product split: 'Marsh (2020) that 1 hectare (1 t/ha) of hemp seed produces 250 litres of hemp seed oil, with approximately 750 kg of hemp meal/cake produced as a by-product.'"
  source_location: "§2 Hemp stigma and regulation, p.11; §3 Secondary market, p.23"
- claim: "NZ hemp industry scale and value: hectares grown rose 'from 259 hectares in 2018 to approximately 1,200 hectares grown in 2020 (Marsh, 2020)' (elsewhere '~1,500 hectares grown in 2019-20'); industry value 'from currently being $4 million to reach $30 million by 2030 (Marsh, 2020)'. No hemp seed or fibre currently exported; domestic market only (NZ$4M)."
  source_location: "§1 Introduction, p.8; §3 Hemp profitability globally, p.20; §2 Current primary market, p.11"
- claim: "Regulatory barriers (NZ THC/food-standards context): industrial hemp remains listed in Schedule 3 of the Misuse of Drugs Act 1975 (Class B/C), only <0.5% THC cultivars may be grown under MOH licence; selling hemp seed as human food was illegal until the 2017 Australia NZ Food Standards Code change (prior to which only hemp oil could be sold). Hemp/hemp products cannot legally be fed to animals in NZ (ACVM Act 1997), which blocks the pet-food secondary market. Max THC in food products (Table 12, adapted from Burton et al. 2022): Australia/NZ industrial hemp plant 0.35%, hulled seed 5 mg/kg, hemp seed oil 10 mg/kg, flour/protein powder 10 mg/kg."
  source_location: "§2 Hemp stigma and regulation, p.11; §3 Secondary market, p.23; §3 Regulation, Table 12, p.24"

Neobiome Intelligence relevance

Feeds the food model’s oilseed/plant-crop evidence on the D02 plant path — but its contribution is yield-range corroboration and economics, not a new measured constant, and explicitly not protein.

1. Firms the compiled hemp seed yield central tendency. OT_112 gives hemp 0.8–1.0 t/ha seed as a compiled Table 4 range. This report independently reports 0–2,000 kg/ha, average ~800–1,000 kg/ha — the same central value, from overlapping secondary sources (Tupu.nz 2022, Marsh 2020). It is therefore a second compiled witness to the same number, which is useful because the two measured NZ trials held against RT_362 — the NZGA Fasamo/Canterbury trial (804–1,849 kg/ha) and the NZHIA multi-site work (950–1,800 kg/ha, max 2,800) — sit at and above this ~800–1,000 average, so the compiled figure lands at the conservative/low end of the measured envelope rather than contradicting it. Net effect: OT_112’s hemp 0.8–1.0 t/ha is corroborated at both the compiled level (this source) and the measured level (the two trials); the low end 0.8 t/ha is a defensible conservative anchor.

2. Protein is NOT measured here — do not touch the plant-protein constant. The only composition numbers in this report are Table 1’s USDA-borrowed reference values (hemp seed 30 g protein / 100 g). That is a generic USDA figure, not a New Zealand hempseed measurement, and it must not be lifted into LEGUME_PROTEIN_KG_HA or any protein cell. The measured NZ hemp composition axis is OIL (the Fasamo/NZGA trial measures oil content + fatty-acid profile via AOAC 991.36), not seed protein — NZ-measured hempseed protein % remains unpublished across all three RT_362 sources. Hemp is also the wrong crop for the model’s plant-protein anchor: it is an oilseed (per Marsh, 1 t/ha seed → ~250 L oil + ~750 kg meal), and per OT_112 it needs 100–130 kg N/ha (a poor regenerative fit, unlike the N-fixing faba anchor OT_088).

3. CapEx/OpEx land-use economics (④f context, not a wired cell). If hemp is ever costed as a community land use, this report supplies grey-lit anchors: seed gross margin **~2,336/ha** (fibre ~2,183/ha), operating surplus 1,725/ha seed / 1,572/ha fibre, and — critically — the capital intensity that sinks hemp’s IRR (seed 50 ha needs 1,265,000** initial capital → **4.1% IRR**; fibre **877,500 → 6.7%; both far below milling wheat’s 12.8% and NZ dairy’s $3,189/ha EBIT). The design signal for a self-sufficiency model: hemp is not financially competitive with dairy or wheat on the same LUC 1–4 arable land, and its viability is dominated by post-harvest drying/storage/processing capital — an economics-of-scale barrier, not an agronomic one. Treat as indicative land-use-economics context only (medium, compiled/overseas-supplemented, 50 ha commercial framing), not a per-cell input.

Caveats for the model:

1. Compiled, not measured. Yield cites Tupu.nz/Marsh; nutrition is USDA; costs are overseas-supplemented Lincoln/barley/wheat analogues with “best professional judgement” — the report itself says the figures “should be only used at a high level.”
2. Commercial 50 ha framing. IRR/CapEx are built on a 50 ha dairy-alternative scale, not a ≤1 ha community plot — the capital-intensity story transfers directionally, the dollar figures do not.
3. OIL-not-protein. Repeated deliberately: nothing here is an NZ hempseed protein measurement.

Research targets

Documents to retrieve

• None new. This source is one of three retrieved against RT_362 (hemp leg); RT_362 stays OPEN (partial). The measured hemp-yield primaries are the sibling NZGA Fasamo and NZHIA sources; the soybean, quinoa and chickpea legs remain unresolved (soybean paywalled/1966, quinoa no NZ trial, chickpea measured yield not yet obtained).

Research gaps

• No new RT. The absence of an NZ-measured hempseed protein % is a known gap already folded into RT_362’s protein-firming aim (and the soybean/quinoa protein gap is RT_363 on OT_112) — not opened as a separate target.

Notes

PDF (34 pp) read in full via pdftotext -layout; every figure above is verbatim from the extracted text (grep-confirmed). Direct authoritative download from ag-emissions.nz (NZAGRC alternative-land-use series) — no AI-retrieval provenance. Bibliographic reference: Inness, M. 2023. Potentially Hemp. An analysis into the opportunity for commercial expansion of hemp production in New Zealand. Final report on alternative land use analysis 4: Hemp. A report prepared for the New Zealand Agricultural Greenhouse Gas Research Centre. 35 pages. Written by Morgan Inness; reviewed/approved by Lee Matheson (Perrin Ag). data_quality: medium = the read is faithful, but the source’s own figures are compiled (yield) / borrowed (USDA protein) / overseas-supplemented (costs), so it corroborates rather than constitutes a measured primary. context: both — the yield range + economics feed the NI food model, and the alternative-land-use viability / regulatory-barrier analysis is thesis-relevant (why economically-marginal alternative land uses struggle to displace pastoral farming).

Connections

Links to

Sources (2): OT_088 · OT_112

Referenced by

EDT domains (1): D02: Smart Food Systems & Agriculture

Sources (1): LIT_098