Future of South Dakota’s Hemp Industry: Record Harvest, Uncertain Road Ahead

24 April 2025

South Dakota’s hemp farmers delivered another major win in 2024, harvesting a record 3,700 acres—a 22% increase over last year. Despite nationwide industry volatility, South Dakota continued to outperform other states, thanks to strong coordination between farmers, processors, and state agencies.

Even with a 30% decline in yield per acre, the overall value of South Dakota’s hemp crop surged 50%, fueled by a sharp 73% increase in price per pound. Fiber hemp remains the backbone of the state's success, with South Dakota contributing 23% of all fiber processed nationwide.

Local investment is also driving the sector forward: a second fiber processing facility is under construction in Wakonda, slated to open by July 2025, further strengthening the state’s leadership in industrial hemp production.

Key Takeaways for South Dakota Stakeholders

• Farmers and Entrepreneurs: South Dakota’s maturing infrastructure and strong prices offer continued opportunities in cannabis cultivation and industrial hemp fiber production.

• Medical Cannabis and Hemp Consumers: A healthy hemp industry supports broader acceptance and normalization of medical cannabis in South Dakota and can contribute to future growth of South Dakota dispensaries and medical marijuana access.

• Industry and Researchers: The state remains a national model for efficient fiber hemp production, but future innovation in South Dakota cannabis testing and processing could be affected by new laws.

Looking Ahead: Uncertainty on the Horizon

Despite the strong harvest, the future of South Dakota’s hemp industry is not entirely clear. The 2025 South Dakota Legislature is currently considering House Bill 1268, which would ban hemp extraction across the state.

If passed, the bill would limit how hemp can be processed, potentially restricting the development of value-added hemp products like oils and concentrates. For now, South Dakota’s hemp farmers and processors are celebrating a record year—but watching closely as policymakers shape the next phase of the industry.

South Dakota’s role as a national hemp leader is secure for now. What comes next will depend on how the state balances opportunity, regulation, and innovation.