Why would it depress prices for other crops? The economic phenomena you're describing is called "replacement" but it's not like farmers aren't growing opium poppies because cannabis is so easy to grow.
Cannabis and opium poppies cannot be used to produce the same end-product. From what I understand, hemp can replace cotton in most end-products; being much easier to grow (and hence cheaper / more plentiful), it could potentially flood markets earlier reserved to cotton, hence depressing prices.
Say you have two farmers; one grows cannabis, the other cotton. Because cannabis is easier to grow, the cannabis farmer has more stock to sell, and if demand from the drug market does not absorb it all, he'll try to sell it on the cotton market, potentially igniting a price war with the second farmer.
Interesting, I was not aware that this sort of situation could spring up. But I don't think this should be a reason behind retaining criminalization of marijuana. To those who tout "Free Market" and "True Capitalism," it should be plainly clear that hemp should be allowed to fill the market if it can provide a better or comparable product at a better price. While I don't necessarily think we should necessarily promote a free market economy, I definitely think that marijuana legalization should not be hindered by the potential "negative" drawbacks such as these. Worst case, the government should focus its efforts in regulating prices and uses for marijuana plants, similar to how they regulate/subsidize over-farming.
I am well aware about the two plant species and their uses by humans.
The original poster said MJ, which is not hemp. Marijuana is psychoactive and hemp is not, though they are the same species. The economic idea of "replacement" is that one good (Coca-Cola) can be replaced by a comparable good (Pepsi) based on price discrimination or differences in quality. My point is that MJ can displace a comparable good (another narcotic like opium) but it cannot replace corn or cotton as the uses of all these products are different.
Now maybe you mean hemp can replace/displace cotton or corn? I definitely agree hemp can displace cotton but that's because the water requirements, fertilization and effort spent harvesting are so much easier for hemp than cotton.
I am really confused by your assertion that a cannabis farmer is going to sell their MJ "on the cotton market." Maybe you mean that resources that would have been spent purchasing cotton commodities will instead be used to purchase cannabis commodities?
Cannabis and hemp are basically the same plant -- yes, one is psychoactive and the other is not, but they share cultivation tools and as far as I know, cannabis can be used in the same way hemp is (although the opposite, of course, is not true). At the moment hemp is locked out of the market because it's too similar to cannabis for authorities to just let people grow it; but once cannabis is legalised, hemp will likely make a big comeback, as cannabis grower will grow both cannabis and hemp, if necessary switching between one and the other at very short notice, especially if the price of cotton rises over the one for psychoactive cannabis. Even without switching actual cultivations, as far as I know, you could sell cannabis as hemp (although the opposite is not true) right away.
> I definitely agree hemp can displace cotton
That's what I'm saying. Hemp is much cheaper and it's been shut out of the market only because cannabis was and the two cannot easily be distinguished. Once they're both legal, things will change.
At this time though, the only reason farmers are not allowed to grow hemp is because hemp is related to marijuana. We would have to assume, that if marijuana was legal to grow, hemp would be as well. Legalizing marijuana probably would upset the cotton industry.
edit: Just re-read the parent comment that spawned this exchange. I get the distinction you are trying to make.
That's not quite the case though. Hemp is a member of the cannabis plant family, but it's very low in THC (the active ingredient in the recreational type of cannabis). In other words, industrial cannabis (hemp) and recreational cannabis are two different plants. The farmer would be growing for one side of the market.
There is a lot of different infrastructure for large scale cotton farming versus large scale hemp farming. Those heavily invested in the former have obvious incentive to keep it profitable rather than having to retool. That isn't to say that it's economically most efficient, but that it can certainly motivate propaganda and eventually legislation (and my understanding is that there's some historical evidence that this is what happened, but that it's not completely conclusive).
There are absurd amounts of cotton subsidies in this country, to the extent that it's cheaper to ship American grown cotton to factories where it's made into shirts.
Typically the opposite happens, where we import crops (cocoa beans, etc) and make the products here to save money.
