The final 2018 Farm Bill has passed the U.S. Senate with a vote of 87-13. Now, the Farm Bill has passed the house with a margin of 349-47, and is headed to the President desk to be signed into law. Below we highlight sections in the Farm Bill that impact Hemp and CBD…
Interstate Commerce
SEC. 10114. INTERSTATE COMMERCE.
(a) RULE OF CONSTRUCTION.—Nothing in this title or an amendment made by this title prohibits the interstate commerce of hemp (as defined in section 297A of the Agricultural Marketing Act of 1946 (as added by section 10113)) or hemp products.
(b) TRANSPORTATION OF HEMP AND HEMP PRODUCTS.—No State or Indian Tribe shall prohibit the transportation or shipment of hemp or hemp products produced in accordance with subtitle G of the Agricultural Marketing Act of 1946 (as added by section 10113) through the State or the territory of the Indian Tribe, as applicable.
Descheduling of CBD
This language defines that hemp derived CBD, which is under .3% Delta-9 THC will be descheduled. This is a huge win for the Hemp and CBD industry, and a glimpse at how Cannabis policy will evolve in the coming years.
(b) TETRAHYDROCANNABINOL.—Schedule I, as set forth in section 202(c) of the Controlled Substances Act (21 U.S.C. 812(c)), is amended in subsection (c)(17) by inserting after ‘‘Tetrahydrocannabinols’’ the following: ‘‘, except for tetrahydrocannabinols in hemp (as defined under section 297A of the Agricultural Marketing Act of 1946)’’.
Testing Requirements
The rules allow for states and Native American territories to establish a reliable method for testing for delta-9 THC, ensuring the crop falls under the legal definition of Hemp. Testing methodology with vary state to state. Oregon for example tests hemp in the field weeks before harvest for THC compliance, which provides flexibility for farmers. States out east are considering using post-decarboxylation, which will result in substantially higher Delta-9 THC test results and a more difficult environment to be compliant. Good seed stocks will be essential for these areas to secure a compliant crop. Whoever distributes a high CBD, zero THC feminized seed stock will help farmers in areas with stringent testing.
433 S.L.C. territory of the Indian tribe, including a legal description of the land, for a period of not less than 3 calendar years; ‘‘(B) a procedure for testing, using post-decarboxylation or other similarly reliable methods, delta-9 tetrahydrocannabinol concentration levels of hemp produced in the State or territory of the Indian tribe;
Regulatory Oversight
With the legalization of Hemp federally, we will have more oversight from federal agencies. The California department of health led the charge this summer by disallowing hemp derived CBD products in Marijuana products, and in anything consumable. Expect more states to follow suite in developing rules and regulations, and expect federal agencies to create broad reaching policies that will have a large impact on finished goods manufacturers.
‘‘(b) AUTHORITY.—Subject to subsection (c)(3)(B), the Secretary shall have sole authority to promulgate Federal regulations and guidelines that relate to the production of hemp, including Federal regulations and guidelines that relate to the implementation of sections 297B and 297C. ‘‘(c) EFFECT ON OTHER LAW.—Nothing in this subtitle shall affect or modify— ‘‘(1) the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.); ‘‘(2) section 351 of the Public Health Service Act (42 U.S.C. 262); or ‘‘(3) the authority of the Commissioner of Food and Drugs and the Secretary of Health and Human Services— ‘‘(A) under— ‘‘(i) the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.); or ‘‘(ii) section 351 of the Public Health Service Act (42 U.S.C. 262); or ‘‘(B) to promulgate Federal regulations and guidelines that relate to the production of hemp under the Act described in subparagraph (A)(ii).
Crop Insurance
Hemp will be added to the list of crops that can be federally insured.
SEC. 11106. INSURANCE PERIOD. Section 508(a)(2) of the Federal Crop Insurance Act (7 U.S.C. 1508(a)(2)) is amended by striking ‘‘and sweet potatoes’’ and inserting ‘‘sweet potatoes, and hemp’’.
In summation, the 2018 Farm Bill will have a tremendous impact on our industry. Are you ready? The flood gates are opening for banks, advertising, shipping and transportation, and competition. Legalization will also bring challenges as agencies determine how best to regulate this new market. Similar to the Cannabis industry, we will see lag time in large ancillary businesses developing hemp specific policies. We will also see a constantly evolving legal landscape as new rules are implemented and revise rules around hemp and CBD.
Hold on tight, this is a once in a lifetime opportunity.
Onwards and Upwards,
Michael Gordon
CEO
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Source: “AGRICULTURE IMPROVEMENT ACT OF 2018 .” U.S. House of Representatives Document Repository, U.S. House of Representatives, 2018, docs.house.gov/billsthisweek/20181210/CRPT-115hrpt1072.pdf.
Tyana Daley
