The Significance of the 2018 Farm Bill for the Hemp Industry
The hemp industry is expected to evolve into a $22 billion market by 2022
In late-December President Donald Trump signed the 2018 Farm Bill changing the hemp and CBD (cannabidiol) industry overnight. As a member of the U.S. Hemp Roundtable, we are updated weekly on the progress of topics and legislation that will have an impact on our business and businesses alike, and we feel confident this new bill will significantly change our industry for the better. We are here to shed light on the 2018 Hemp Farming Act, part of the U.S. Farm Bill led by Senate Majority Leader Mitch McConnell and what it will mean now that this revised bill is officially enrolled.
THE BANNING + REVIVAL OF A NON-PSYCHOACTIVE PLANT
Hemp cultivation has not always been banned. Hemp was once an agricultural staple – its durable fibers used for numerous products including canvas, cloth and rope. Hemp restrictions began in the 1930s to curtail marijuana use. The misplaced fears that hemp was the same as marijuana discouraged cultivation by imposing fees and restrictions that made hemp farming undesirable.
In the 1970s, The Controlled Substance Act classified cannabis as a schedule 1 drug. Since hemp is cannabis, industrial hemp farming was banned. Product manufacturers that relied on hemp seed oil and hemp fiber were forced to rely on imported hemp.
The 2014 U.S. Farm Bill cleared the legal confusion between hemp and marijuana by defining the plants by their THC content. This differentiation acknowledged that hemp and marijuana are not the same, and allowed the government to establish pilot programs for industrial hemp cultivation.
THE 2018 FARM BILL WILL FREE HEMP FROM FEDERAL REGULATION
With the signing of the 2018 Farm Bill, hemp farming will no longer be limited to the terms of the pilot program detailed in the 2014 Farm Bill. When restrictions are lifted, hemp will be treated the same as any other commodity crop. There are several benefits to removing federal restrictions, including:
- ENDING THE LEGALITY DEBATE
Since hemp cultivation is federally restricted, there is a bit of a grey area about the legality of hemp-derived CBD and other hemp products. When all hemp crops are legalized on the federal level, there will be no more need to interpret the intent of the law or debate legality.
- PROVIDING PROTECTION FOR HEMP FARMERS
Although hemp is legally cultivated in many states, hemp farmers do not currently qualify for federal crop insurance because the Farm Service Agency (FSA) doesn't recognize hemp as an agricultural crop. When hemp qualifies as an agricultural crop by the term of the Farm Bill, hemp farmers qualify for federal crop insurance, subsidized insurance that protects farmers from income loss caused by natural disasters and declining prices.
- OPENING THE DOOR TO SPONSORED RESEARCH
While hemp CBD is not a medication or cure for any medical condition, research shows that the cannabidiol (CBD) in hemp oil has the potential to provide significant health benefits. Removing hemp from the list of federally restricted commodities opens government-sponsored research programs to researchers investigating the potential medical benefits of hemp oil supplements.
- MAKING CONDUCTING BUSINESS EASIER
Many companies are hesitant to work with the hemp industry because of the grey areas created by federal restrictions. Removing hemp from the controlled substance list will make life a lot easier for businesses, giving hemp farmers and product manufacturers access to more credit card processing options, advertising and banking services.
- REMOVING THE STIGMA
When companies like CBDistillery provide consumer education about the differences between hemp and marijuana, we are not quite where we want to be in terms of public awareness. By removing hemp restrictions, the government essentially removes the cannabis stigma that still influences consumer purchasing decisions.
THE POTENTIAL IMPACT OF THE 2018 FARM BILL ON THE AMERICAN ECONOMY
Until the passing of the 2014 Farm Bill, the U.S. relied solely on imported hemp. With the approval of the 2018 Farm Bill, we anticipate a large influx of capital into the hemp market, with an increase in the number of hemp farmers, quality hemp products, product consumers and business investors.
The signing of the 2018 Farm Bill will provide economic stimulation, bring countless jobs and income potential back to the American soil. By removing the restrictions on hemp farming, the 2018 Farm Bill places hemp from American farmers into the hands of American manufacturers and consumers. The hemp industry is expected to evolve into a $22 billion market by 2022.
Chase Terwilliger is the CEO of CBDistillery.