Union Fiber Co.

Union Fiber Co. Chempco set up operations in the building pictured in 1936. Later, the building, located between Ewing and Stone streets on West Third Street, was home to Archer Daniels Midland. The site is currently the home of the Bob Welch Aquatic Center.

With prohibition over and the saloons open again, there were men in Minnesota who saw marijuana as the business to get into.

In 1937, Cannabis Inc. was an optimistic start-up business at 902 E. Second St., current address of the Winona Daily News, and Chempco Inc. was operating at the address now occupied by Technigraph on West Third Street. Both enterprises were linked to the fortunes of Frank Holton, who probably sold more marijuana in Minnesota than any man yet to live.

Now Holton wasn’t the Pablo Escobar of ditch weed, and Winona was hardly the Medellin of Minnesota. Like the advertising slogan for a popular cigarette brand of the era, Holton could claim not a cough in a carload for the marijuana he marketed and for a simple, straightforward reason: Only a dope would try to smoke it. The cannabis Holton dealt in was the near-beer of marijuana industrial hemp. With a THC content of less than 0.5 percent, the closest to a buzz anyone would catch off Holton’s weed amounted to a headache and a sore throat with a lingering bad taste on the tongue.

If it wasn’t much good for getting high, Holton’s hemp was good for any number of other things enough things to convince solid Norwegian farmers and sober Main Street businessmen to invest hard-earned Depression-era dollars in the production and processing of what Popular Mechanics touted as the New Billion Dollar Crop.

There was nothing new about hemp; the plant had been grown for thousands of years, primarily for the fibers that strengthen its stem. These fibers can be woven into products ranging from rope and tough burlap to fine linen-like fabrics and delicate lace.

In the 1930s, investors’ hopes were pinned on a new machine, the decorticator, which separated the plants’ fiber-bearing cortex from the woody hurds, as the core of the hemp stem was called. The fibers would be processed for textiles or made into paper, while the hurds, containing more than 77 percent cellulose, were raw material for products as diverse as dynamite and cellophane.

It was in the fall of 1933 that Holton, a former bank cashier, mortgage speculator and wheeler-dealer in stocks and securities, showed up in Mankato, Minn., promoting the interests of the Northwest Hemp Corp. and offering investors shares of stock in the enterprise at $1,000 a share.

Chempco Inc. was organized in 1936 and set up operation in Winona in the old Union Fiber plant on West Third Street. Seventy-nine farmers in Winona and Wabasha counties contracted 950 acres of hemp to supply the Chempco plant.

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When Holton shipped marijuana to Winona it came in by the boxcar-load, and he boasted he could stockpile 10,000 tons--enough to last him nearly a full year. He had 40 people at work full-time, capable of processing more than six tons of Minnesota Green every hour.

Unfortunately, the market for hemp hurds was not as well-developed as Holton had hoped. The plant’s output of the material quickly overwhelmed both the market and available storage.

A portion of the hemp fiber was shipped across town to Cannabis Inc., where E.G. Witt oversaw a crew of 12 people experimenting with new uses for the material. The firm planned to use the spun yarn in rugs, upholstery fabrics and mop heads, but only the mops ever made it into production and onto the market.

As it struggled with new technology and the need to create and expand markets, Harry Anslinger was exactly what the infant hemp industry did not need.

Commissioner of the federal Bureau of Narcotics, Anslinger launched an all-out attack on marijuana. Reefer Madness was alleged to be sweeping the nation, drawing hapless youth into depraved lives of crime, indolence and sexual debauchery. In the face of the near-hysterical accusations, Congress passed the Marijuana Tax Act of 1937.

The new federal law required government agents to be on hand to observe every aspect of hemp manufacture and placed extreme regulatory requirements on the disposal of foliage and other hemp waste. While the legislation has clearly been less than successful in eliminating the use of marijuana as an intoxicant, it was the death warrant to the use of hemp as an industrial raw material.

The law effectively regulated Cannabis Inc., Chempco Inc. and other enterprises out of business. Farmers put their land back to corn, oats and hay, while Anslinger went on to make his mark as the first field marshal in the war on drugs.

Ironically, cannabis, not the variety raised for rope, is now believed to be one of the country’s major cash crops ... the only crop generally bought and sold using cash.

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(1) comment


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