• The 2018 Farm Bill passed the US Senate by an 87-to-13 margin and the House by a 369-to-47 margin.
  • Growing and producing hemp will now be federally legal, easier and cheaper to grow
  • The Farm Bill removes hemp-derived products (AKA CBD) from Schedule I status
  • CBD produced from cannabis (higher than 0.3% THC) remains Schedule 1
  • Cannabis plants must contain less than 0.3% THC to be classified as hemp
  • Banks and payment processors can now service the hemp industry

The 2018 Farm Bill which overwhelmingly passed in the U.S. Senate and House, was signed into law by President Trump on Thursday.

The Bill removes Hemp and by-products (AKA CBD products) from Schedule 1 Status. The Department of Justice will no longer be responsible for hemp, growers will now have to submit cultivation plans to the US Department of Agriculture (USDA).

There are still strict regulations applying to those growing industrial hemp.

While section 12619 of the Farm Bill removes hemp-derived products (CBD) from its Schedule I status under the Controlled Substances Act, the legislation does not legalise CBD generally.

Cannabis plants must contain less than 0.3% THC to be classified as hemp (0.1% higher than in the UK).

“Cannabusiness” lawyer Steve Schain, from Hoban Law Group, highlighted these key points from the Farm Bill regarding hemp:

  • Help research will be allowed for pharmaceutical uses as well as for health, wellness and general nutrition, opening the doors for much more testing
  • Banks and payment processors or credit card companies can now service the hemp industry
  • Hemp farmers will be allowed to buy crop insurance for the first time
  • Investment and capital infusion is allowed in both hemp oil and fibrous hemp businesses (clothes, etc).
  • Hemp and hemp products can now be traded and carried across State borders
  • Convicted felons can join the industry 10 years after the bill passes
  • Hemp futures can be traded for the first time, locking in prices for farmers

Chief executive of Calyx Peak, an American multi-state cannabis grower, Ed Schmults, believes that the new law could help bring down the price of CBD for both producers and consumers:

“Hemp offers a lower cost option for CBD, hemp is easier to grow than cannabis.”

The significance of this law change should not be underemphasized.
– Paul Armentano, NORML Deputy Director

Discussing the Bill’s provisions for CBD, John Hudak from the Brookings Institute, explained how the Farm Bill is unlikely to fully legalise the non-psychoactive cannabinoid (for now anyway):

“It is true that section 12619 of the Farm Bill removes hemp-derived products from its Schedule I status under the Controlled Substances Act, but the legislation does not legalize CBD generally.

“As I have noted elsewhere on this blog CBD generally remains a Schedule I substance under federal law.

“The Farm Bill ensures that any cannabinoid — a set of chemical compounds found in the cannabis plant — that is derived from hemp will be legal, if and only if that hemp is produced in a manner consistent with the Farm Bill, associated federal regulations, association state regulations, and by a licensed grower.

“All other cannabinoids, produced in any other setting, remain a Schedule I substance under federal law and are thus illegal. (The one exception is pharmaceutical-grade CBD products that have been approved by FDA, which currently includes one drug: GW Pharmaceutical’s Epidiolex.)”

Despite hemp and hemp-derived products being removed from Schedule 1, CBD from cannabis remains banned.

The developments also mean CBD infused food and drinks could be hitting American shelves in the near future, but currently CBD remains a pharmaceutical ingredient.

In a statement regarding the 2018 Farm Bill, FDA Commissioner Scott Gottlieb clarified that CBD is currently only approved for use in certain drugs. CBD can relax users but doesn’t get them high.

The FDA has said it will look into whether it could allow the use of a drug ingredient in food, holding a public meeting “in the near future” to determine next steps.

For now, the FDA will continue to stop companies from marketing CBD as a drug or disease-thwarting dietary supplement without vetting and approval by the agency, the statement said.

Coca-Cola released a statement saying they will wait to market CBD drinks after the rules are clear.

NORML Deputy Director, Paul Armentano, released a press release describing the Bill’s provisions as a significant step in the history of cannabis in the USA:

“The significance of this law change should not be underemphasized.

“This law marks the first change in the federal classification of the cannabis plant since it was initially classified as a schedule I controlled substance by Congress in 1970, and paves the way for the first federally-sanctioned commercial hemp grows since World War II.”

References and further Reading