Farm Bill Seeds Ground for U.S. Hemp Production

The bipartisan farm bill that is waiting for the president’s signature will allow U.S. farmers to legally grow, cultivate and sell hemp, lifting decades-old legal restrictions.

Senate Majority Leader Mitch McConnell (left) inspects a piece of hemp taken from a bale of hemp at a processing plant in Louisville, Ky. on July 5.
AP Photo/Bruce Schreiner
Dec. 12, 2018, 8 p.m.

Farmers in the U.S. will soon be able to get in on the burgeoning hemp industry after years of facing legal barriers that placed strict restrictions on domestic hemp production and made the market mostly reliant on imported products.

The last farm bill, passed in 2014, helped open the door to hemp production in the United States by allowing pilot programs and research to study the growth, cultivation, and marketing of hemp. But outside of these programs, most of the hemp market in the U.S. relies on foreign-produced products.

Senate Majority Leader Mitch McConnell, who signed the farm-bill conference report Monday with his hemp pen, said the pilot program alone contributed $16 million to Kentucky’s economy.

“Fighting for Kentucky hemp has been a long struggle,” said McConnell on the floor of the Senate on Tuesday morning. “My state was once the national leader in the growing and production of industrial hemp, but then for decades a federal ban halted that progress and shut American farmers out of the hemp field. Don’t get me wrong; hemp could still be found all over our country in all kinds of products. The problem is that it’s just all being grown somewhere else and imported into America.”

The 2018 farm bill, which was sent to the president’s desk Wednesday, would remove hemp from the Drug Enforcement Administration’s jurisdiction and allow for the plant to be regulated by the Agriculture Department or by states that submit a plan to oversee hemp production. It is considered a Schedule I drug under the Controlled Substances Act.

“[The bill] really resets it as an agricultural crop going forward, and by taking the DEA out of it, it allows it to be regulated more like, truly like other crops,” said Eric Steenstra, president of Vote Hemp, which advocates a free market for industrial hemp.

Removing hemp from DEA’s list of controlled substances would resolve issues that producers face with banking and opens up the opportunity for e-commerce, said Brady Cobb, the CEO of international cannabis company SOL Global.

Cobb said that states that were large tobacco producers may turn to hemp as an alternative. “Hemp is a very resilient plant,” he said. “It is a plant that farmers like to grow because it is something that is not overly sensitive, it’s resilient, and it’s something they can start to kind of wean themselves off tobacco.”

The hemp industry does appear to be a lucrative area. Under the 2014 version of the farm bill, there were 3,500 licensed participants who planted more than 77,000 acres in 2018, according to Vote Hemp. The group also said the U.S. market for hemp products grew to more than $800 million as of 2017.

The hemp industry is poised to reach $1 billion in sales this year, according to data from the Hemp Business Journal.

But not all hemp products are entirely in the clear to be sold and shipped across the United States. The Food and Drug Administration’s position is that cannabidiol, or CBD, products cannot be sold as dietary supplements but industry stakeholders are pushing for this classification.

“The problem is that recently FDA granted approval for a drug called Epidiolex, and Epidiolex is a CBD extract. So we have some concern about whether or not the FDA is going to attempt to classify CBD as a pharmaceutical drug,” said Erica McBride Stark, executive director of the National Hemp Association.

“It’s really the problem of whether or not they can grandfather in CBD as a dietary supplement or food additive in light of the fact that they have now granted approval for a prescription drug that is in essence CBD,” she added.

Vote Hemp acknowledged the FDA’s expressed stance on CBD products, but stated on its website that the agency has “not said that whole plant hemp extracts are covered.”

Cobb said some therapies may go through pharmaceutical approval but to make all products go through this FDA pathway would be expensive. “That’s a tall order; it’s an incredibly expensive order,” he said. “I think there are opportunities for certain therapies to go that route, that will ultimately go the pharma route, but we support a dietary-supplement review and having that same track apply to CBD products.”

For now, the changes that lawmakers passed out of Congress and are awaiting President Trump’s signature will provide farmers with another resource to turn to.

“U.S. farmers have continued to struggle with low prices for crops and so hemp provides another useful tool in the toolbox,” said Steenstra. “It’s also a good rotational crop. It can help farmers to diversify, to provide another stream of income, to have another crop that they can grow that helps them to deal with better crop management, disease issues, that kind of thing. Hemp tends to leave the soil in good condition because it has a deep taproot and also a decent canopy that gets rid of weed. So there are a number benefits to the farmer.”

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