The production of hemp in the U.S. state of Kentucky has a history dating to pioneer times, was criminalized in the 20th century, and has recently resumed as a legal industry.
In the 18th century, John Filson wrote in Kentucke and the Adventures of Col. Daniel Boone (an appendix of his 1784 work The Discovery, Settlement and Present State of Kentucke) of the quality of Kentucky's land and climate for hemp production. The first hemp crop in Kentucky was raised near Danville in 1775.
Kentucky was the greatest producer of U.S. hemp in the 19th and 20th century, with thousands of acres of hemp in production. Senator Henry Clay was a "hemp pioneer" and the "strongest advocate" of Kentucky hemp. He grew it on his Kentucky estate Ashland and brought new seeds to the state from Asia. Clay's oratory on the senate floor in 1810 in favor of requiring the Navy to use domestic hemp exclusively for ship's rigging was widely reprinted in newspapers and is credited for beginning the elaboration of the American System. Production reached a peak in 1917 at 18,000 acres, mostly grown in the Bluegrass region, then waned due to market forces after World War I as other sources of fiber were introduced. A Federal program to reintroduce hemp for wartime needs in Kentucky and other states during World War II reached 52,000 acres in Kentucky in 1943. The WWII effort is documented in the USDA film Hemp for Victory .
Production of hemp had seen a decline after World War I. The decline was due to market forces including the rise of tobacco as the cash crop of choice in Kentucky and foreign sources of hemp fiber and finished products. The availability of cheap synthetic fiber after World War II even further discouraged farmers from growing it.
Federal policies, tightened by the Controlled Substances Act of 1970, virtually banned the production of industrial hemp during the War on Drugs. According to an industry group, "the 1970 Act abolished the taxation approach [of the 1937 Marijuana Tax Act] and effectively made all Cannabis cultivation illegal". The Drug Enforcement Administration refused to issue permits for legal hemp cultivation and held that, since industrial hemp is from the same species plant as prohibited cannabis (despite its being of lower THC yield), both were prohibited under the Controlled Substances Act. In the words of a 2015 PBS NewsHour segment on hemp, "To the federal government, hemp is just as illegal as marijuana", and according to Newsweek, "all cannabis sativa—whether grown to ease chronic pain, get stoned or make rope—is a schedule I controlled substance".