COMPANY GETS SALES HIGH FROM HEMP

Product becomes alternative fabric EarthGoods representative Amie
Miesem can spot the question coming from an aisle away. People
approach an American Hemp exhibit space, like they did at the recent
Showtime trade show, with either a bashful - almost apologetic - tone
or a straight-to-the-point request.

"They look over the material, check the texture, then ask, 'Hey, can
you smoke this stuff?'" said Miesem, national sales manager for EarthGoods.

"I tell them they can certainly try, but they won't get any kind of
high, and more than likely will get a pretty bad headache."

That's because the fabrics that EarthGoods uses for its American Hemp
division products is a fiber crop. It is of a non-THC variety and does
not provide mind-altering effects if smoked, Miesem said.

EarthGoods, of Spokane, Wash., marketed its hemp products for the
first time at the recent Showtime, which concluded July 12.

The hemp fabrics are touted as a middle-to high-end alternative for
canvases, blankets, accessories and upholstery products.

"We began to receive favorable reaction to hemp in the apparel
industry a few years ago," Miesem said. "From internal and external
conversations, we began to see the potential for hemp in upholstery
and home decor.

"We did some research and found that Showtime was the place to be in
order to reach the most people in home furnishings fabrics."

American Hemp, founded in 1992, was bought by EarthGoods in 2000. The
company designs, develops and imports textile collections based on
what it calls the world's highest quality hemp twine, cordage and
webbing, as well as hemp-blend fabrics. The company sells its products
from between $3.55 and $19.25 a yard, depending on the fabric quality.

American Hemp bills its hemp products as "ancient fiber, future
fabric" that can meet the demands of today's fabric upholstery consumers.

Among the company's claims are:

a.. Hemp is nature's longest, strongest and most durable
fiber.

b.. It has insulating qualities that allow clothing wearers to stay
cool in the summer and warm in the winter.

c.. Hemp is naturally resistant to mold and ultraviolet light, making
it attractive to use with rugged wear and outdoor uses.

d.. The porous nature of hemp allows it to readily absorb water and
dyes. That knowledge, however, doesn't prevent industrial hemp from
having to deal with the stigma of being related to marijuana.

It also doesn't keep the U.S. government from restricting its growth
domestically. Miesem said the manufacturer has to import its hemp
fabrics from Eastern Europe and China mills. It also is looking to
eventually acquire hemp fibers in Canada.

Industrial hemp supporters are lobbying the U.S. Drug Enforcement
Agency to allow the domestic planting of non-THC hemp as an
alternative crop for tobacco growers.

The DEA is considering allowing an exemption for certain industrial
hemp products, such as paper, rope and clothing, to be marketed in the
United States without being subject to the Controlled Substance Act.

EarthGoods' appearance wasn't the first for a hemp fabric provider at
the trade show. Hemp Textiles International had shown recently.

Catherine Morsell, director of the International Textile Market
Association, said her group did selective research on EarthGoods to
make sure it was a legitimate industrial hemp business.

"Their product does carry a stigma with a number of people in our
industry," Morsell acknowledged.

"But it also definitely has its supporters and a growing customer base
among middle-and high-end furniture consumers."

Morsell said she had seen consumer demand for hemp fabrics grow in
recent years.

"It's becoming more accepted as an apparel alternative and is making
progress in the home furnishings industry," Morsell said.

"They do have some barriers to overcome with some upholstery
manufacturers. But being at Showtime was a smart step on their part in
that direction."

Miesem said her first Showtime proved more advantageous that she had
anticipated.

"We saw quite a bit of walk-up traffic we didn't expect," Miesem said.
"We found a couple of sales reps for High Point and the East Coast."

Miesem insisted that hemp fabric could enjoy a renaissance in the
states in the near future by offering the apparel and fashion and
furniture industries a new, yet old, alternative.

"It also could breathe new life into many U.S. farms, especially those
who are trying to wean themselves off tobacco crops," Miesem said.
"It's just going to take a lot more educational initiatives on the
hemp industry's part to help make it happen."

For more information about EarthGoods or American Hemp, call (509)
466-3640 or (303) 639-9653, or e-mail at amiesem@qwest.net.
EarthGoods' Web site is www.earthgds.com

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Company Background

Hemp is among the oldest industries on the Earth, going back more than
10,000 years to the beginnings of pottery.

The Columbia History of the World states the oldest relic of human
industry is a bit of hemp fabric dated at approximately 8,000 B.C.
Industrial hemp is legal to grow in more than 25 countries, including
Australia, Canada, China, Germany, England, France, Hungary, the
Netherlands, Poland, Romania, the Russian Federation, Spain and Thailand.

Canada licenses for commercial agriculture, with more than 30,000
acres planted in 1999.

Many states, but not North Carolina, have passed legislation to grow,
study or request changes in U.S. government policy on industrial hemp.

The Drug Enforcement Administration has received applications to grow
significant acreage of hemp crops domestically, but has not approved
any of them as of Thursday.

Source - Hemp Industries Association