Inside a nondescript warehouse east of Indianapolis, vertical shelving holds hundreds of cannabis plants with different genetic strains. A conspicuous, pungent smell hangs in the warm humid air as special grow lights hover inches from the tops of the lush green plants.
This unique Hoosier farming operation, though, is not what you may suspect — at least not yet.
Half Moon Hemp, established in 2018, raises Cannabis sativa plants to supply Indiana’s burgeoning new hemp industry. But founder Adam Gilliatte said he is poised to transition to more lucrative medicinal or recreational marijuana should lawmakers catch up to other states that legalized what remains an illegal drug in Indiana.
For now, the Purdue University grad is focused solely on cannabis varieties that produce an extremely low level of the compound that gets people high. There’s a market for that, too.
His target is farmers who have registered to grow hemp on more than 2,000 acres of farmland across Indiana. Their crop is primarily used for fiber. Some also ends up in CBD supplements, ranging from creams to gummy candies that companies market for everything from getting a better night sleep to helping with post-traumatic stress disorder.
State officials closely monitor the Indiana-grown hemp to ensure levels of THC, the psychoactive substance delta-9 tetrahydrocannabinol, fall within limits set by the U.S. Department of Agriculture. Growing plants that don’t exceed the limit is not an exact science and last year nearly 20% of the state’s hemp crop was destroyed after testing too “hot,” according to the Office of Indiana State Chemist.
Half Moon Hemp has dabbled in the retail side of the hemp business, but Gilliatte said he still prefers to work with farmers. His goal is to develop strains tailored to Indiana’s climate — hardy plants that produce the most flowers and contain a maximum of 0.03% THC — and then clone them to supply “starts” for hemp farmers. In some ways, it’s a modern twist on the seed corn industry, only with a few raised eyebrows and a potential pot of gold down the road.
“I’m going to keep making great flowers,” he said, “but somebody else has got to figure out how they want to use them.”
Raised in rural Indiana
Gilliatte found his way to Cannabis sativa in a roundabout way.
He grew up out in the country in central Indiana where his family raised cows, chickens, horses, rabbits and goats.
“We had a small mini-farm,” Gilliatte said. “My entire life revolved around agriculture in Hamilton County.”
Though immersed in agriculture from a young age, Gilliatte pursued engineering in college. This degree led him into construction, and today he also owns and operates Gilliatte General Contractors. As he led the Indianapolis-based construction company, Gilliatte began to pick up passion projects.
“I became very passionate about food through a lady named Martha Hoover, who owns Café Patachou,” he said. Hoover instilled the mindset that “our food should be our medicine and our medicine should be our food, which Hippocrates wrote.”
Once he learned how important good food is to people and developing minds, he invested in an indoor growing facility that produced vegetables. The aquaponic and hydroponic facility grew everything from edible flowers to sprout mixes that Gilliatte would sell to all the big distributors in Indy.
But sometimes it turned out to be a losing proposition, Gilliatte explained. He might grow 50 pounds of kale, but the distributors would only buy 25 pounds. All the effort, time and money he had in the other half of the crop would be lost.
It was during this venture, Gilliatte said, that he learned it is the wholesaler, not the farmer, who is more likely to make the money. That was another life lesson on the path to his new role in the hemp industry.
Suffering losses was obviously not going to work, so Gilliatte jumped on an opportunity to take what is called a slip — or cutting — of a Cannabis sativa plant from a grower in Denver, Colorado, and launched his new venture.
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Half Moon Hemp would put roots on these cuttings and begin cloning hemp plants for Hoosier farmers to grow in their fields and harvest.
Cannabis through the centuries
Cannabis sativa has been used for fiber, oil, and medicine for thousands of years. The first American flag was even said to be woven from the plant better known as hemp.
But for decades in the U.S., including Indiana, restrictive laws created huge challenges for farmers who wanted to grow hemp as a crop.
Some states in the U.S. have legalized and decriminalized marijuana, but Indiana only allows the plant to be grown as hemp.
The Indiana legislature in 2014 began a state research program under the Indiana Hemp Act. The project was led by Purdue university and initiated under the federal Drug Enforcement Agency.
Four years later, when the federal government passed the 2018 Farm Bill, state lawmakers in Indiana modified the hemp act allowing the crop to be grown with heavy regulations in the state.
Marguerite Bolt, hemp extension specialist at Purdue, said the first year of commercial hemp production began during the 2019 growing year. As a specialist, Bolt works with hemp growers, industry members and the public to provide fact-based information from university resources.
“There’s a lot of misconceptions about the industry and what hemp is used for,” Bolt said. “People don’t understand the distinction between hemp and marijuana. They are the same plant species, there are just plants that are bred to produce more THC.”
The Indiana State Department of Agriculture tracks the licenses issued to growers. The department's latest numbers, which were updated May 2020, show that 256 growers acquired licenses for 635 planned grow sites. The majority of grow sites, about 72%, were planned to be outdoor and the rest were for indoor growing operations.
For Gilliatte, the federal 2018 Farm Bill paved the way for his new business.
Growing toward Indiana's future?
Gilliatte has grown his Half Moon Hemp to house between 800-900 "mother" plants, which are used to make clones. Those clones are then raised carefully with organic nutrients, recycled water from the warehouse atmosphere and constant testing to make sure the THC levels remain where they’re supposed to be.
To make clones from the mother plants, Gilliatte makes a 45 degree cut from the top of the plant near a thick part of the stem known as a node. This cutting is placed with others into a multi-section tray and fed a rooting hormone. The trays are kept in controlled environments with care put into the temperature and humidity ranges. It takes about seven days until roots form and the clones are ready for farmers.
He also puts live pests on the plants to test for resistance, tests drought resistance and finds the best genetics for Indiana growing conditions. His goal is to develop the hardiest plants that produce the most flower.
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A separate, smaller building nearby the larger grow facility acts as almost a laboratory, with genetics being crossed and new strains being tested for durability in Indiana’s environment.
Mark Pay, Half Moon Hemp’s CFO, handles not only the finances, but the company’s website, technical side of things as well as marketing and social media.
Pay also knows his bugs. From spider mites to lady bugs, he keeps a close eye on any pests that may affect the plants and reacts accordingly with natural products.
Pay walks the warehouse each day monitoring humidity and checking on each strain to make sure it’s within limits. When plants are large enough, he moves them outside to “harden” them against Indiana’s natural environment. Sheltered beneath porous sheets that are designed to let in a controlled amount of light, the plants stay here until they are ready for a farmer to come and pick them up.
Meanwhile, Half Moon Hemp also is looking at developing its own products.
In a corner room in the main office, a large industrial press stands ready to squeeze oils out of hemp plants. A nearby table displays an array of products for testing that Gilliatte and Pay consider for their own products.
That said, they are getting into the coffee business by working with a local roaster and infusing beans with CDB oils. CBD, or cannabidiol, is a chemical found in Cannabis sativa plants that does not have the same psychoactive effects as THC.
“We only grow female plants so that they produce the maximum amount of CBD,” Gilliatte said.
As Gilliatte and Pay work diligently to produce the plants that work best in the state, they said they are prepared to transition into the marijuana business should Indiana lawmakers ever catch up with other states in the U.S.
Currently 17 states have legalized marijuana, including Indiana neighbors Illinois and Michigan. Ohio allows medical marijuana for patients but has yet to allow for recreational marijuana. Kentucky, like Indiana, has not moved to legalize or decriminalize the plant.
“The reality is that people are anticipating that sometime next year that we'll be able to grow marijuana,” Gilliatte said. “So that's why I think there are two or three (marijuana growing) facilities that are either under construction or in design in the state, because they know it's inevitable.”
Legalization has brought a huge influx of tax revenue for the states that moved to legalize.
In July, Illinois governor, JB Pritzker, announced the state collected $445 million in tax revenue from cannabis sales for fiscal year 2022.
"Illinois has done more to put justice and equity at the forefront of this industry than any other state in the nation and has worked to ensure that communities hurt by the war on drugs have had the opportunity to participate," Pritzker said in a news release. "The $1.5 billion in sales of adult-use cannabis in Illinois translates into significant tax revenue with a portion of every dollar spent being reinvested in communities that have suffered for decades."
If Indiana were to legalize marijuana, Gilliatte said legislators could put that money toward roads and schools to help out the communities here. “That tax revenue is huge,” Gilliatte said. “The state could use it in a good way.”
Karl Schneider is an IndyStar environment reporter. You can reach him at email@example.com. Follow him on Twitter @karlstartswithk
IndyStar's environmental reporting project is made possible through the generous support of the nonprofit Nina Mason Pulliam Charitable Trust.
This article originally appeared on Indianapolis Star: Grown IN Indiana: Hemp growers test new strains, wait for legalization