The beginning of December 2018 has proved to be a pivotal week for CBD. The Senate has agreed on H.R. 2 The Agriculture Improvement Act, known as the “2018 Farm Bill”. This bill is awaiting president's signature in the coming days and once signed will forever change the hemp industry. The bill gives the Secretary of Agriculture supervision over the soon to be multi-billion dollar commodity and gives the states authority to set production, testing and licensing protocals. The 800+ page document is not an easy read, but we’ve highlighted the main impactful points that have caused confusion since the 2014 farm bill and were clarified for 2018.
This might be the largest win for the hemp industry. The bill removes Tetrahydrocannabinols derived from hemp from schedule 1 controlled substances. This was previously a point of confusion because while hemp was legal, Tetrahydrocannabinols from hemp was not specifically excluded from Schedule 1. According to the bill
SEC. 12619. CONFORMING CHANGES TO CONTROLLED SUBSTANCES ACT.
‘‘(B) The term ‘marihuana’ does not include—
‘‘(i) hemp, as defined in section 297A of the Agricultural
Marketing Act of 1946; or
‘‘(ii)(b) TETRAHYDROCANNABINOL.—Schedule I, as set forth in sec-
tion 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)’’.
This language is important because it removes previous confusion and questions about the legality of CBD from hemp. This was a debated point by law enforcement and Attorney Generals. Federal and state agencies will need to make some adjustments over time as they incorporate the new law into their organizations, however removing ambiguity from the law is the main point.
What is Exactly Legal
The bill is very clear the definition of hemp and what is allowed.
‘‘SEC. 297A. DEFINITIONS.
‘‘(1) HEMP.—The term ‘hemp’ means the plant Cannabis sativa L. and any part of that plant, including the seeds thereof and all derivatives, extracts, cannabinoids, isomers, acids, salts,
and salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than 0.3 percent on a dry weight basis.
The bill clearly states that hemp and all of its derivatives are allowed as long as they are below the .3% THC limit. This is important language for food additives and edible products made with hemp or isolates and can serve as a guiding principle for other federal agencies, specifically the FDA and USDA.
An issue that plagues the CBD market place currently is access to banking, shipping and other basic business services. The confusion on a federal level made it difficult for CBD companies to maintain bank relationships and even the shipping of products. This too was addressed in the new bill with the following;
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 of1946 (as added by section 10113)) or hemp products.
This provision makes it possible for producers to freely engage in business across state lines and use traditional finance institutions. Ease of access will be a long term advantage for the end customer as operating costs will drop and access to traditional lending will make full scale commercial production possible.
Current regulations in the CBD market are inconsistent and depend on individual state rules. As a way to address this without forcing a one size fits all solution the new bill gives states the ability to implement their own testing, production and licensing protocals with some federal guidance. This keeps producers in compliance, ensures a more reliable product for end consumers and still gives individual states the freedom to govern as they see fit.
‘‘SEC. 297C. DEPARTMENT OF AGRICULTURE.
‘‘(B) a procedure for testing, using post-decarboxylation or other similarly reliable methods, delta-9 tetrahydrocannabinol concentration levels of hemp pro-duced in the State
‘‘SEC. 297C. DEPARTMENT OF AGRICULTURE.
‘‘(E) a procedure for conducting annual inspections of, at a minimum, a random sample of hemp producers to verify that hemp is not produced in violation of this sub-title; and
‘‘SEC. 297B. STATE AND TRIBAL PLANS.
‘‘(A)‘‘(ii) a procedure for testing, using post-decarboxylation or other similarly reliable methods,
delta-9 tetrahydrocannabinol concentration levels of hemp produced in the State
Agricultural & Industrial Revolution Part II
CBD companies and producers won’t be the only winners from this new law. Struggling farmers now have a chance to grow a crop that is highly profitable, simple and has food and industrial uses. While the focus is usually on hemp as a supplement, the majority of hemp will be utilized in building materials, fuels, food and textiles. The utility of the crop makes it very appealing to farmers, however without insurance or a stable market for their product there was risk in large scale operations. Including hemp into the Federal Crop Insurance Act reduces the risk to the farmers and opens the door to commercial scale farming operations.
SEC. 11119. AGRICULTURAL COMMODITY.
Section 518 of the Federal Crop Insurance Act (7 U.S.C. 1518) is amended by inserting ‘‘hemp,’’ before ‘‘aquacultural species’’.
It will take some time for local, state and federal agencies to catch up to this monumental shift in policy. There will be some initial confusion and more than likely there will be a couple false starts, however in this instance Congress does deserve credit for getting out of the way and allowing the American people to figure out what works best for them. It is a rare occurrence to have an entire industry moved out of prohibition and made federally legal. Consider yourself lucky to witness the birth of an entire new industry.
This article represents the opinions of the author and in no way represents medical or legal advice. Always consult with your physician before taking any supplements.