In December 2018, Congress passed the Agriculture Improvement Act of 2018, commonly known as the Farm Bill. Within the legislation, modifications were made to decriminalize and define the parameters of the cultivation, sale and transport of hemp. The legalization of industrial hemp could present opportunities for GCCA members, but industrial hemp and related products will still be strictly controlled, and the regulatory framework has yet to be developed. Under the bill, industrial hemp is permitted to be grown and sold, only if it contains no more than 0.3 percent of Delta 9 tetrahydrocannabinol, or THC, and if the grower is licensed and complies with all growing regulations.
In terms of implementation, section 10113 of the bill dictates that the state department of agriculture must work with the state’s governor and chief law enforcement officer to create a plan that the Secretary of the United States Department of Agriculture (USDA) will review. Only with the Secretary’s approval can the plan be put into effect. Should a state not create a mechanism for regulation, it will be given a default structure and regulatory program that will determine how hemp growers can attain growing licenses and operate within the federally run program. The new law will include hemp in protections for farmers under the Federal Crop Insurance Act. This section specifically addresses crop losses for farmers but does not state if it protects the crops that are destroyed should they contain more than the legal 0.3% THC limit.
Additionally, industrial hemp is no longer restricted to pilot programs that are overseen by USDA and individual state departments of agriculture. It can now be distributed across state lines for multiple purposes. So long as hemp and its products are grown and sold in compliance with federal and state laws, there are no restrictions on the sale, transport, or possession of hemp products. However, there are a number of issues pertaining to standardization of regulations across states, which could affect interstate commerce and transport.
On March 13, USDA’s Agricultural Marketing Service hosted a listening session where stakeholders discussed their concerns with the 2018 Farm Bill’s implementation and subsequent ramifications. Standardization of regulation encompasses many aspects of the supply chain, be it standardized testing methods and facilities for testing, reporting, or distribution means. More specifically, GCCA found inconsistencies and ambiguities with sampling methods of industrial hemp, such as the timing in which it is done and who is authorized to do it, what will crop insurance look like if plants have higher than a 0.3% THC level and must be destroyed, and standardized destruction methods for hemp plants that violate the 0.3% THC rule.
Because federal regulations for interstate transportation and commerce have not been defined, it leaves states without guidance in cases when states encounter transportation of hemp that violates the individual state laws. As of now, there is currently no standard process to confirm if hemp has been produced through legal means. Compounded with limited understanding of the difference between a marijuana and hemp plant and limited technology to accurately measure the THC percentage, enforcing the law can become convoluted with industrial hemp and could lead to more work. Since industrial hemp and marijuana are indistinguishable to the eye, the opportunity for smuggling of marijuana during hemp transport is a real concern. Additionally, current field-testing units for THC are non-specific, and only detect the presence of THC and do not distinguish between legal and illegal THC levels for hemp.
For many stakeholders, the key is for USDA to outline consistent regulations in a timely manner. Currently, USDA does not have such plan, and at the House Agriculture Committee on February 27th, Secretary Perdue estimated that regulations will not be finalized until before the 2020 growing season.
GCCA is actively engaging with USDA as the process moves forward and will continue to update members on the latest developments. In conjunction with the Scientific Advisory Council, GCCA is working to develop resources related to commodity storage. Additionally, insurance and transportation implications from the new policies regarding industrial hemp will be monitored and addressed.