The Farm Bill of 2018 and What It Means for Hemp:

Maryland Farmer and family walking through field

With the passing of the 2018 Farm Bill (also called the Agricultural Improvement Act of 2018), hemp or cannabis sativa has essentially become legal on the federal level, but there are still significant rules and regulations associated with hemp cultivation, processing, and distribution. When it comes to CBD derived from the hemp plant, the rules are a bit difficult to understand, so in this post we will help demystify the farm bill and give an overview of what it means for hemp and its derivatives.

Background of the Farm Bill:

Let’s first start by looking at the farm bill as a whole. The “farm bill” is the primary agricultural and food policy tool of the federal government. The farm bill was created an attempt to provide subsidies to farmers and ranchers in the midst of Great Depression--the largest economic downturn in American history. Roughly every five years since 1933, the farm bill is renewed through congressional proceedings. The title “farm bill” may be a bit misleading as this piece of legislation covers everything from commodities and trade, to crop insurance and conservation and most importantly, roughly 78% of the mandatory spending within the bill goes toward nutrition programs such as SNAP (food stamps). Visit https://www.farmaid.org/blog/farm-bill-101/ and https://www.farmpolicyfacts.org/farm-policy-history/ to learn more about the farm bill.

The Farm Bill and Hemp:

What exactly does this mean for hemp and its derivatives? For starters, lets define exactly what hemp is and how it differs from its psychoactive counterpart containing more THC that we are familiar with here at PAH. Hemp is the cannabis sativa plant that has less than 0.3% THC. It’s pretty simple but any cannabis plant that contains less than 0.3% THC is a hemp plant and those above that level would still be classified as illegal cannabis or marijuana. What the farm bill did was re-classify hemp (cannabis with less than 0.3% THC) to an agricultural commodity, no different than corn, wheat, or soybeans. This gives farmers access to crop insurance, alleviating fear of any prosecution and most importantly allows for more private research to be conducted. This is great news, right! Before you know it, you will be able to run to your local garden store and grab some hemp seeds along with tomato, lettuce, cucumber, and corn seeds…NOT SO FAST. We need to explore some more rules and regulations have been put into place as the hemp industry begins.

Below Brookings Institute provides a helpful breakdown of the hemp program structure:

Under section 10113 of the Farm Bill, state departments of agriculture must consult with the state’s governor and chief law enforcement officer to devise a plan that must be submitted to the Secretary of USDA. A state’s plan to license and regulate hemp can only commence once the Secretary of the USDA approves that state’s plan. In states opting not to devise a hemp regulatory program, USDA will construct a regulatory program under which hemp cultivators in those states must apply for licenses and comply with a federally-run program .

What does this mean? Essentially every state through their Department of Agriculture, executive and legal branches, must devise a plan for hemp production that the USDA needs to approve of before any hemp production can begin in that state. Since this is a joint regulatory effort between the individual states and the federal government, each state will be on different steps of this process. States like West Virginia, Kentucky, Colorado, Pennsylvania and North Carolina have had pilot hemp programs through the USDA and State Department of Agricultures for years, which puts them ahead of the curve. What the farm bill did for these states was take away fear of persecution, and pave the way for everyday farmers to add a tremendous crop to their rotation.

Hemp and Farming in Maryland:

Where is the state of Maryland in terms of hemp production and regulation? Luckily, the state of Maryland introduced its own hemp regulations in 2018 ahead of the farm bill that will follow the rules and regulations set forth by the farm bill.

In simplest terms here is how we think the program will work in Maryland. Our sister company Peninsula Holistics has been on the forefront of the new hemp industry in the state and we believe it is prudent to provide our insight as we have been actively trying to navigate the market for over a year now. As of today, no hemp has been grown in Maryland, but with some luck, there will be seeds planted in the spring of 2019.

Steps to Grow Hemp:

  1. In order for a farmer to grow industrial hemp they first must have a partnership with an institution of higher learning, to which the cultivation of hemp will further agricultural or academic research.

  2. The farmer must then submit an application to cultivate to the Maryland Department of Agriculture.

  3. If the application is approved the farmer may then source hemp seeds to grow. The farmer is free to source any seeds they wish BUT every seed must go to Morgan State University first, to be certified. ** Unlike other states the Maryland  Department of Agriculture has contracted with Morgan State University to facilitate and oversee the program**

  4. Once the seeds have been certified they will be released to the farmer for planting. 

  5. Like any other crop, farmers are expected to have nutrient management plans, and can expect regular visits from the USDA and Maryland Department of Agriculture to ensure healthy and legal crops are being cultivated.

  6. Once harvested farmers are free to market their hemp crop like any other agricultural commodity.

CBD from Hemp:

All the farm talk is great, and surely this will be a fantastic opportunity for farmers looking to diversify their crop, but what does this mean for us as consumers? The most widely asked question, “Is CBD from hemp now legal?” Like anything else in cannabis the answer is both “yes” and “no”. Let’s start pessimistically with, “No CBD from hemp is still illegal”. CBD is still classified as a schedule one substance unless it has been approved by the FDA, in such cases where approved by the FDA, CBD is schedule five. What does this mean? It means all CBD with the exception of those products approved by the FDA remain schedule one. Currently Epidiolex is the only “CBD” drug that meets these standards.

Section 12619 of the farm bill removes hemp derived products under the Controlled Substances Act, but the legislation does not legalize CBD generally. This states that any cannabinoind that is derived from hemp would be legal if and only if the CBD is produced from hemp plants which are consistent in a manner with the farm bill, associated federal, state and local regulations and by a licensed grower or processor.

Below is a step by step process of how most CBD products are brought to market today. This method is illegal and as we interpret it and will remain illegal until proper farm bill practices are followed.  

  1. Christy opens a supplement company that will specialize in CBD products

  2. Christy goes online and procures bulk CBD oil from a large international company overseas

  3. Christy has the CBD oil shipped directly to her business

  4. Christy then packages and distributes her CBD oil direct to the consumer 

The hemp and its derivatives used in many CBD products on the market currently are produced at scale in countries such as Russia and China but they technically remain illegal to sell as CBD in the United States. Oftentimes these products are inferior to US CBD products and these countries do not have testing or regulations associated with them, which makes them a huge risk for consumers.

 In our opinion, in order to have a fully legal CBD product, seeds must be certified and test less than 0.3% THC, the hemp must be grown by a licensed grower, and all other state agriculture regulations must be followed. Unless the product was harvested by a licensed grower and has gone through the proper regulatory proceedings, the product remains illegal. Since the cultivation of hemp is a brand new industry in the United States, the majority of the products today are coming from overseas. These products lack any sort of regulations and are not tested. Like other products that are not regulated, they are pumped full of harmful additives and fillers unbeknownst to consumers. Before you go out and purchase any type of CBD products, please understand where it comes from. If a company is unable to tell you the source of their hemp or they cannot provide simple testing results similar to the MMCC’s program, chances are that the CBD is not what you are expecting. CBD is a cannabinoid with tremendous health benefits that we are only beginning to unlock. Check out Peninsula Holistics to learn more about our full spectrum hemp extract oil.

While the farm bill has zero effect on the legality of cannabis or “marijuana”, it is a tremendous step forward in the overhaul of federal cannabis regulation and should serve as a stepping stone to other more comprehensive federal legislation.

 Written by Chuck Henn, COO