2018 Farm Bill Delta 9 Below .3% Is Now Considered Hemp
2018 Farm Bill Delta 9 Limits
The 2018 Farm Bill has been signed into law. As of Dec. 20, industrial hemp — defined as all parts of cannabis plants having less than 0.3 percent tetrahydrocannabinol (THC) — is federally legal. This includes “derivatives,” “extracts” and “cannabinoids.”
Kentucky, historically the nation’s top manufacturer of hemp, launched an innovative pilot program for farmers as part of the 2014 Farm Bill. This program was a basis for the hemp section of the law and should make Kentucky the epicenter of hemp in the United States.
The interest in hemp production as supported by the 2014 Farm Bill was then expanded on in the Agriculture Improvement Act of 2018. With a focus on correcting and clarifying regulations and guidance from the US Department of Agriculture (USDA), hemp farms in the US are finally getting a break. It’s too early for hemp producers and processors to sound the “all clear,” however.
The same day as the 2018 farm bill passed, the FDA issued a press release asserting its right to regulate cannabidiols (CBD) from hemp, the popular product accounting for most hemp sales and acreage nationally. The legality of CBD is clearly a "yes" federally, but still threatened by agencies who aren't done fighting yet. Importantly, at least the Drug Enforcement Administration (DEA) removed hemp as a schedule 1 drug from the Controlled Substances Act.
In late December, Facebook began shutting down pages of American farmers trying to market hemp, and Google continues to refuse online ads, calling these ads “trafficking controlled substances.” Uncertainties and risk persist, though it seems that hemp production is finally transitioning into a more stable business.
Where is this al going? Good question. Varying estimates of the size of the hemp CBD market turn up everywhere. A Rolling Stone story touted the Brightfield Group projecting the market for hemp to be worth $22 billion dollars by 2022, while the Hemp Business Journal estimates CBD will be a $2.1 billion market by 2021.
Farm bills are the primary vehicle for food and agriculture policy in the United States. Traditionally, Congress will convene every five years to handle the revisions and renewals of this encompassing bill.
The first farm bill, the Agricultural Adjustment Act (AAA), was passed in 1933 and signed by Roosevelt. With this bill, the government bought livestock and paid farmers subsidies to not plan on their land. So naturally, this helped boost the prices of their goods.
The AAA established the precursor to food stamps as well.
This legislative tradition continues to this day. The term "farm bill" is more or so a moniker for this type of legislation. The official name of the 2018 Farm Bill was the "Agriculture Improvement Act of 2018."
So what did the 2018 Farm Bill do for hemp and Delta-9 legalization?
We'll start with how hemp was treated by the law before the 2018 Farm Bill.
Hemp's Drug Scheduling Before 2018
To fully understand how the 2018 farm bill legalized Delta-9 from hemp, we first need to establish how hemp was viewed by the federal government beforehand.
Hemp has a long history in the United States. From the colonial era to the industrial revolution, hemp was a valuable and versatile crop. It could be used for cloth, paper, rope, and at one point, acting as a sort of piston ring in steam engines.
The stigmatization of hemp and marijuana picked up in the 20th century. In 1937, the Marihuana Tax Act taxed the crop to the point of it not becoming economically viable.
For the most part, there really wasn't a legal distinction between hemp and marijuana.
If you go through the Controlled Substances Act of 1970, you will not find one mention of the word "hemp." Instead, it states:
The term "marihuana" means all parts of the plant Cannabis sativa L., whether growing or not; the seeds thereof; the resin extracted from any part of such plant; and every compound, manufacture, salt, derivative, mixture, or preparation of such plant, its seeds or resin. Such term does not include the mature stalks of such plant, fiber produced from such stalks, oil or cake made from the seeds of such plant, any other compound, manufacture, salt, derivative, mixture, or preparation of such mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of such plant which is incapable of germination.
Biologically speaking, hemp and marijuana are the same species - cannabis. This definition clumps both of them together as one.
There is a bit of differentiation for "mature stalks" and their derivatives. This effectively did nothing for hemp. For example, it took until 2004 for North Dakota to become the first state to give licenses for farming hemp in nearly 50 years.
What you need to know is that back then, and until 2018, hemp and marijuana were one and the same in the feds' eyes.
The 2018 Farm Bill
The Agriculture Improvement Act of 2018 did a lot of things, including:
- Reauthorizing many nutrition programs
- Not adding more requirements for SNAP recipients
- Provide funding for:
- Farmers markets
- Organic farming research
- Farming education
- Veteran and minority farmers
It also incorporated some of the language of the Hemp Farming Act of 2018. In the previous farm bill, there were pilot programs established for hemp agriculture.
The overall goal was to open the gates for the farming and distribution of this historical cash crop.
To do so, it had to make a legal distinction between hemp and marijuana. Thus, in the 2018 Farm Bill, it states:
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.
Here are the key takeaways from that text:
- Hemp is cannabis with a Delta-9 THC concentration at no more than 0.3% concentration on a dry weight basis
- The legal definition of "hemp" includes not just the plant but also its extracts and cannabinoids
Legal Differences of Hemp and Marijuana
The 2018 Farm Bill separated hemp from marijuana and made it legal on a federal level. Other states adopted similar measures.
Some people say that the difference between marijuana and hemp is how it's used. Marijuana's use stems from its psychoactive properties. Hemp, on the other hand, is used for industrial purposes such as making ropes, fabrics, oils, and so on.
To Uncle Sam, there is just one main distinction.
Cannabis with a 0.3% or less Delta-9 concentration on a dry weight basis is hemp. Anything above that is marijuana.
Although a historic moment for hemp, marijuana, as of July 20, 2021, remains a Schedule I drug. Although some states have legalized marijuana for medicinal and recreational purposes, it is illegal on a federal level.
This means anything that is considered marijuana cannot:
- Cross state lines
- Be shipped in the mail
- Get transported on a plane
- Be purchased with a debit or credit card (in the majority of circumstances)
Products that fall within the category of hemp can bypass these restrictions.
Delta-9 Extracted From Hemp
Delta-9 THC isn't illegal in every circumstance. It all depends on how it's sourced, along with the percent of concentration on a dry weight basis.
If you’ve ever used a full spectrum or select spectrum hemp product, you’ve used legal Delta 9 THC. All full spectrum hemp (also called full spectrum CBD) has Delta 9 THC in it.
Here's an easier way to think about it.
Let's say you wanted to make a gummy.
To help you picture it in your head better, we'll say it's a cherry gummy.
Why? Because just about everybody likes cherries.
If the cannabinoids, at any amount, were extracted from marijuana, that gummy is federally illegal.
If the cannabinoids extracted from hemp have a D9 concentration at a dry weight exceeding 0.3%, it's federally illegal.
However, if the cannabinoids used in this strawberry gummy is sourced from hemp, and its Delta 9 concentration is at 0.3% (or lower), it's federally legal.
Delta-9 needs to meet both criteria to be legal:
- Sourced from hemp
- At a concentration no more than 0.3% dry weight.
Conclusion On 2018 Farm Bill
Delta-9 THC is illegal in many circumstances, but not all of them.
Just as the 2018 Farm Bill made Delta-8 THC legal on a federal level, Delta-9 was legalized in certain circumstances.
What differentiates hemp and marijuana in the eyes of the law is the Delta-9 THC concentration.
Cannabinoids extracted from hemp that do not exceed a concentration of 0.3% Delta-9 at dry weight are legal. That's pretty much it.
What Does This Mean for Hemp Farmers?
I can answer first for my own farm, and then for farmers we know. I started farming in 2017, and of necessity became a farm entrepreneur. I was one of the first to start and develop a craft hemp flower brand, and so knew that business. When the opportunity to raise hemp presented itself, I started growing the crop and at the same time started breeding hemp genetics.
The venture thus became dependent on our ability to set up the supply chain and sell our hemp through Dreamland Organics, for CBD flower. We assumed the market pricing risk, knew our costs, and could figure out what the product was worth. The passing of the Farm Bill 2018 gave a boost to the hemp industry.
The farmers in our neighborhood are not marketers, nor do they want to be. Their experiences have been quite different. The primary complaint is that they are not getting paid for their hemp by their contract processors, or that payment is significantly delayed and confusing. Trust in the market from farm to processor has become something of an issue and farmers are worrying about the size of the market and global competition.
The passage of the farm bill will fix this by creating some stability in the business. Robust markets will develop consequently, with stable buyers, clear prices and payment terms, all of which is a little bumpy right now. Also, none of us have been able to insure our crop, increasing the production risk.
Because hemp is legal, this is to be solved for the 2019 crop year, and I’m off to see several agents soon. The bottom line, though, is that we have a new market. Hemp flower is now the fastest growing segment of the much larger CBD industry.
Those who take premium hemp flower production seriously will benefit in the long run. It has been proven that craft hemp flower farms like Dreamland Organics will thrive, while industrial hemp farms deal with over saturation. It's better to be a big fish in a small pond, than a big fish in a huge ocean.
The truth is that there is less competition the higher up the craft hemp flower ladder you go. That means adhering to artisanal standards will pay dividends and allow for a longer run in the hemp business. A dime a dozen biomass and white label CBD flower brands are learning that the hard way. It's a good time to be the craft "Hemp Flower Kings!"
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