Herbs Can Yield Profits
by Jane Sooby
Herbs have gained a lot of notoriety in the past few years. Here are some basics about herbs.
What is an herb? This term can refer to a type of plant or to a particular use of a plant. When referring to a type of plant, the term means a plant that is soft and green, not woody. Most herbaceous plants are usually annual or biennial, though a few are perennial.
Herbs may be used in cooking, as medicine, or in ceremonies or rituals. Culinary herbs such as basil, thyme, oregano, cilantro, and a multitude of others are familiar to most people, especially those who cook.
Medicinal herbs may not be so familiar. These include herbs such as echinacea, goldenseal, and hundreds of others. Herbs have been used as medicine for thousands of years.
Medicinal herbs are often derived from leaves, roots, fruits, and barks. Flowers and rhizomes are used as well. Some herbs have both medicinal and culinary uses. For example, chile pepper contains the alkaloid capsaicin that assists digestion and reduces inflammation from arthritis when applied topically. Garlic and ginger contain substances that fight infection.
Plants produce secondary compounds (not essential for plant growth) as protective mechanisms to prevent insects or other animals from eating the plants. These chemicals can have physiological effects on humans and can heal.
For instance, the effective ingredient in aspirin is a synthetic version of salicylic acid found in willow bark. The anti-malarial quinine was isolated from the bark of the cinchone tree found in tropical South America. One-quarter of medicines in the U.S. are based on chemicals isolated from plants.
In recent years, more uses of plants for healing have been popularized in the press. St. John’s wort is commonly publicized as a natural anti-depressant. Taxol from Pacific yew tree bark is used as an anti-cancer compound.
Europeans tend to take the healing use of plants more seriously and have studied them in clinical settings longer than researchers have in the U.S.
Ceremonial and ritual uses of herbs are important to many cultures. Sagebrush, lemon verbena, and sweetgrass were used in native American and other earth-based religions for cleansing and purifying. Some plants are also used to scent incense used in many religions.
One reason for the recent interest in herbs is increased interest in alternative medicine. Associated reasons include interest in different forms of spirituality and the increasing popularity of ethnic cuisines. Why are you interested in herbs?
Because many medicinal herbs have traditionally been wildcrafted or gathered in nature, increased demand is causing a decline in wild populations of many of the most popular herbs such as echinacea, goldenseal, and American ginseng. Scarcity in the wild creates opportunities for people to cultivate herbs that are commonly wildcrafted.
Just as important as mastering production techniques is locating a reliable market to purchase your products. There are numerous small businesses in the U.S. growing herbs and/or manufacturing herbal products, and a growing number of large companies that deal in bulk herbs and large-scale herbal product manufacturing.
What can you grow? Begin with what you can produce locally. Some ways to start are:
What can you sell? The possibilities are limited only by your imagination. Take consumer information phone numbers off packages of herbal products and contact the companies to find out their herb buying policies. Talk to as many people as possible in the industry to locate where you might find a buyer. Keep track of popular herb trends as reported in the media.
There are a couple of different approaches to marketing. You can specialize in one or a few items and produce many value-added products utilizing it (like Purple Haze Lavender or Elk Mountain Herbs), or you can provide bulk material on a wholesale basis to existing companies, such as Frontier Herbs in Iowa, that then re-sell and distribute it. Both of these approaches require a lot of work in identifying demand and providing a reliable and high-quality supply.
The USDA has identified "production of high-quality, reliably identified seed sources" as another market need. There is currently little to no regulation of the herb industry—however, FDA requires that no one can make specific claims about medical effectiveness on labels of herbal preparations.
Keep in mind that it doesn’t take a huge level of production to saturate the market with an item that has only moderate demand. To compete in this highly competitive business, assess your resources and market products that are unique to our region. High Plains Echinacea, Pioneer Licorice Root Tea, or sagebrush-scented candles are just ideas to get you started.
Whichever approach you decide to take in marketing herbs, it is essential to become as "expert" as possible in the constituents of the plant, its uses, any toxicity or counter-indications for use, history, and traditional uses. You will be viewed as an expert by your customers.
Forming an herb-growing cooperative may be one way to gain a larger market share by producing a larger quantity of herbs that can be sold to a company. Cooperatives are legal entities and members’ obligations and responsibilities must be clearly spelled out to avoid disastrous misunderstandings.
In some areas, growers find a niche market in providing fresh culinary herbs to local restaurants. Roadside marketing may be an option. Because of the geographical isolation of many rural areas, these may be difficult markets to establish.
Shipping is an important consideration when deciding how to market your herbal products. You may have to market dried herbs in order to maintain quality. This brings in the necessity for drying facilities. Some herbs are freeze-dried to retain higher quality. Equipment to freeze-dry herbs will cost more but may give you a marketing advantage.
There is a wealth of information on herbs out there, in books, on the internet, magazines, growers’ groups, medical use information, etc. Study whatever you can get your hands on. Not a lot of public research has been done on field-scale production methods, so adapt garden recommendations to larger-scale field production. Keep in mind your processing needs. Match the production level with your processing abilities.
Remember that a small-scale herb business will likely be labor-intensive in production, marketing, and management. Start small. Pay attention to plant growth requirements. Consider organic practices, especially since few if any herbicides are labeled for use on herbs.
Nebraska Cooperative Development Center