Hemp

Dan Maclure planted eight acres of hemp on his Vermont farm for the first time this year, aiming to cash in on the exploding demand for CBD, a derivative of the plant reputed to ease anxiety and other ills without the high of its close cousin, marijuana.

He persevered when some of his hemp plants grew white with mildew and others failed lab tests and had to be destroyed. With his harvest now complete, Maclure has one more challenge to overcome: selling his surviving crop and recouping an estimated $140,000 investment.

Image: A windy day hits Veritas Farms in Pueblo/ Jacqueline Collins

Most hemp farmers across the country got a big boost when the United States Department of Agriculture released its first round of industrial hemp regulations earlier this week; the new rules took effect today, October 31.

Hemp flower on display at the Tennessee Grown booth at the Southern Hemp Expo at the Williamson County Agricultural Exposition Park in Franklin, TN on Saturday, Sept. 7, 2019. (Photo By Bill Clark/CQ-Roll Call, Inc via Getty Images)

UNITED STATES - SEPTEMBER 7: U.S Secretary of Agriculture Sonny Perdue announced the establishment of the U.S. Domestic Hemp Production Program this week, a program that creates a regulatory framework around the production of hemp in the United States. The program was required by the 2018 Farm Bill.

The state rules must include procedures for maintaining information about where hemp is produced; testing for THC, the psychoactive compound that gives marijuana users a high; disposing of plants that exceed 0.3% THC; licensing growers; and ensuring resources to run hemp programs.

The Trump administration has announced a long-awaited rule on domestic hemp production that could help relieve legal snags for trucking companies and drivers hauling the crop across state lines.

The U.S. Domestic Hemp Production Program, announced today (Oct. 29) by U.S. Department of Agriculture (USDA) Secretary Sonny Perdue, creates "a consistent regulatory framework around hemp production throughout the United States," as required by the 2018 Farm Bill, which removed hemp from the list of controlled substances.

"At USDA, we are always excited when there are new economic opportunities for our farmers, and we hope the ability to grow hemp will pave the way for new products and markets," Perdue said in a statement. "We have had teams operating with all hands on deck to develop a regulatory framework that meets congressional intent while seeking to provide a fair, consistent and science-based process for states, tribes and individual producers who want to participate in this program."

Concurrent with the rule, USDA also issued guidelines for sampling and testing procedures to provide additional information for sampling agents and hemp testing laboratories.

The agency said the 160-page interim rule will aid in the production, harvesting, transportation, storage and processing of hemp and hemp products. "Absent an interim rule promptly implementing the regulatory program required by the 2018 Farm Bill, there are no procedures in place to determine whether a cannabis crop qualifies as hemp" as defined by current law, the agency said.

Prior to the administration's rolling out this interim final rule (IFR), trucking companies and drivers hauling hemp across state lines have come up against legal problems in states that don't distinguish between hemp and marijuana. The IFR provides more guidance for law enforcement officials who must make those distinctions, according to USDA.

"While the States and Tribes may not prohibit the transportation of hemp produced under the 2014 Farm Bill, law enforcement does not currently have the means to quickly verify whether the cannabis being transported is hemp or marijuana," the agency states. "The IFR will assist law enforcement in identifying lawfully produced hemp versus other forms of cannabis that may not be lawfully transported in interstate commerce."

The IFR will also presumably put regulatory force behind a legal opinion issued by USDA earlier this year that helped mitigate some of the uncertainty for drivers hauling hemp across state lines.

USDA noted that the IFR doesn't address hemp exports. "Should there be sufficient interest in exporting hemp in the future, USDA will work with industry and other Federal agencies to help facilitate this process."

The IFR becomes effective upon publication in the Federal Register, which is expected later in the week, and USDA will also provide for a comment period. If the agency had added a subsequent formal notice and comment period after that, it would have pushed the effective date of the program "well beyond 2020 and into 2021 and [delayed] guidance that stakeholders sorely need," it stated.

The banking industry, for example, has been waiting for regulations to develop their own guidance regarding deposits derived from hemp operations, according to USDA, without which they're not willing risk accepting deposits or lending money to hemp businesses.

In addition, USDA stated, having a rule that goes into effect this fall will allow producers to plan for the 2020 crop year, including identifying planting acreage, obtaining financing and contracting with potential buyers.

Monday, the Alabama Political Reporter talked with Gail Ellis with the Alabama Department of Agriculture and Industries about industrial hemp and complaints from hemp farmers that their state licenses are too restrictive.

Ellis told APR that it is illegal in Alabama for a farmer to sell hemp material to the general public or to anyone without a hemp license.

The Alabama Political Reporter asked about the legality of smokable hemp products being widely marketed in the state.

Ellis said that all of those products are presently illegal as are the hemp gummy bears and other chewable hemp products.

The 2018 Farm Bill make industrial hemp legal throughout the country. After the product was legalized by the federal government farmers applied for and received licenses from the Alabama Department of Agriculture and Industries to grow hemp in Alabama in 2018. These are the first farms to grow hemp in Alabama legally in approximately 80 years. While hemp historically has been used to make paper, rope, building materials, wood substitutes, etc.; most of the hemp being grown in Alabama today are being grown for their flowers which produce cannabidiol when pressed or run through a centrifuge.

Ellis shared a directive from the Department.

“A licensed grower can legally sell unprocessed hemp to a licensed processor/handler. However, even licensed growers or licensed processor/handlers are prohibited from selling unprocessed hemp (i.e. buds, cigarettes, smokable hemp, hemp tea bags, etc.)”

Marketing the seeds, plants, or flowers to anyone other than a licensed grower or processor is also presently illegal, according to Ellis

“Dried hemp in the form of floral and bud material is considered unprocessed. As such, it is illegal to sell to the unlicensed public (i.e. individuals, gas stations, online, CBD stores, etc.). Industrial hemp material can only be handled/processed by those with an Industrial Hemp processor/handler license.”

“Licensed Growers are allowed to sell harvested hemp material to other licensed growers and/or processor / handlers in Alabama OR to licensed growers and/or processor / handlers in other states.”

“For CBD store owners who also happen to have a current Hemp Processor/ Handler license, the y would be legal to possess the dried floral/bud material; however, they would still be prohibited from selling unprocessed hemp to the public. Customers for smokable (unprocessed) hemp would not be licensed to handle hemp, so individuals purchasing such products would be in jeopardy of being arrested.”

The Alabama regulation was written by Gunter Guy Jr.

Lisa Varner is a Moody artist, jewelry maker, and hemp/cannabis activist.

Varner is also a leader of Alabama Hemp Love networking, a group of like minded business people in Moody seeking to raise awareness on the hemp issue.

Varner says that she uses cannabidiol oil (CBD) which is derived from industrial hemp.

“I use it for relaxation and to ease migraine headaches,” Varner said. She has been under a doctor’s care for this in the past but the side effects of the migraine medicines available were far worse than the actual ailment. Lisa says she stopped using man made medicines opting instead for natural alternatives; hemp being the best she has found thus far. “With hemp I miss 2-3 days per year due to my migraines without it 5-7 are often lost due to my condition..”

“I am a naturalist. I rarely eat cooked food,” Varner explained. “I am not for corporations altering my medicines and my foods.”

Warner also sells jewelry that she makes from hemp plants. She expressed concerns that the way that the Alabama Department of Agriculture is interpreting the hemp laws will put her jewelry business in jeopardy.

“Anything that you can make from a tree, you can make with hemp,” Varner said. “And anything you can make from petrochemicals, you can make from hemp.”

Patrick Leberte is a licensed hemp grower in Moody, who also owns Hemp 205, a CBD store.

Leberte said that he put most of his money into his farm and startup business thinking he could sell the flowers

“There is no law against it,” Leberte told APR. When Alabama’s hemp crop was ready to harvest the Department changed the rules.

A source close to the hemp industry told APR that the flowers are 30 percent of the hemp business and that the rule on flowers has hurt the profitability of Alabama hemp growers, who already did not have a good crop because of the August and September drought.

“The raw hemp is the best way you can use CBD,” the source speaking on condition of anonymity told APR. “Processing takes out some of the CBG and turpentine.”

“The flowers are more soothing than the oil,” Varner told APR. While CBD oil is working for her, other people need the flowers, and some persons need marijuana.

Varner said that she favors marijuana legalization as well as the full legalization of hemp in all its forms.

While hemp and marijuana look very similar; hemp has a much lower THC content than marijuana. THC, Tetrahydrocannabinol, is the chemical component in marijuana that produces the “high” and the hallucinogenic effects.

St. Clair County District Attorney Lyle Harmon (R) said that the four hemp farms in St. Clair County were all inspected and were found to have less than .3 percent THC. Anything above that would be illegal and have to be destroyed.

Leberte said that poor weather and late planting due to a delay in getting his seed tested resulted in his first hemp crop being stunted so it had to be destroyed.

An Auburn University ag extension agronomist told APR the hemp plant does not flower until decreasing daylight, September and October, thus the plants have to be kept alive through the long summer. She said that it would be foolish to attempt to grow hemp for CBD without overhead irrigation.

Hemp is such a new crop for Alabama that researchers are not even sure what are the best soil pH and fertilization recommendations are for the plant here. The Alabama Department of Agriculture and Industries is currently accepting applications for hemp growers for the 2020 growing season.

APR asked Leberte if hemp should be like corn: a farmer can plant it if he wants to and he can harvest and sell it to anyone, even the general public, that will buy the product.

Leberte said no; that hemp should be regulated similarly to tobacco to keep it out of the hands of kids.

Ellis said smokable and eatable hemp products and even CBD have not been approved yet. USDA still has to give approvals and so does FDA (the U.S. Food and Drug Administration).

The hemp industry source told APR that some farmers are talking to an attorney about suing the state to allow the direct sell of hemp to consumers, especially the flowers themselves.

Ellis said that the rule has not changed from day one and if growers had read their application they would have seen that selling the flowers to the public was forbidden.

Ellis warned that many stores across the state are selling products that are not legal. There is still an issue of who has jurisdiction; but once that is resolved some people who are selling unprocessed hemp products “Could be going to jail.”

APR asked if hemp cigarettes should be taxed like tobacco cigarettes.

Ellis thought said she thought so, “But that is an issue for the Alabama Department of Revenue.”

Chey Lindsey Garrigan is an economic developer, commercial real estate broker, registered lobbyist and political operative with ties to the national hemp and cannabis industries.

“This will only be solved by the Alabama legislature,” Garrigan told APR. “Legislation will have to be introduced and passed in the 2020 legislative session to fix this. CBD and hemp have benefitted the lives of millions of Americans and the Alabama farmer should not be hindered by their own state government when growing a natural product that is widely available in almost every other state.

“When my father passes, I will be moving someplace else if the state does not get off overregulating the hemp plant,” Varner said.

MARION — One of the most notable elements in the farm bill signed by President Donald Trump last December was the legalization of industrial hemp.

At the time, the bill’s provision removing industrial hemp from the Controlled Substances Act was hailed by advocates and environmentalists as a measure that would allow farmers to diversify their crops and maintain profit margins in the face of droughts and market volatility.

Struggling American farmers felt like they had just received a stay of execution last year when the word came down the pike that industrial hemp production was on its way to becoming legal again in the United States.

It meant they would no longer have to nickel and dime themselves to death by exclusively dedicating acreage to traditional crops like corn and wheat, and they might even be able to stay in the agricultural game long term without the risk of being put out to pasture.

Almost three years after the first medical marijuana dispensary opened in Puerto Rico, the medical cannabis industry is blossoming into a fertile enterprise, generating a monthly average of $4 million in sales, despite a few setbacks.

Since its inception until last August, sales and services reported to the government amount to $128 million, with businesses paying $13.9 million for the sales and use tax (IVU by its Spanish acronym), according to the Treasury Department. So far this year, tax revenues from medical marijuana have increased by 127.5 percent.

Louisiana officials hope the federal government will approve the state’s industrial hemp program by Jan. 1 so they can begin issuing licenses.

If all goes according to plan, Louisiana farmers will begin planting the new crop this spring.

Though the federal government is not expected to issue its rules until next month, the Louisiana Department of Agriculture and Forestry has crafted the basic framework based on what they expect the feds will want.

“Almost all states are following a similar pathway,” LDAF Commissioner Mike Strain said Monday to a legislative agriculture committee. “I know there’s a full-court press [by the federal government] to get this done.”

Louisiana lawmakers legalized industrial hemp this year in hopes of establishing a new cash crop for the state’s farmers. Hemp is derived from the same plant species as marijuana but has very low levels of THC, which is what gets marijuana users high, and can be used in a wide variety of products such as rope, clothing, plastics and fuels.

The 2018 federal farm bill excludes hemp from the list of dangerous controlled substances and allows states to set up hemp-farming programs. LDAF will license growers, track acreage, inspect crops and potentially seize and destroy plants with too much THC.

Strain said crops will be limited to having about 0.3 percent THC, though he hopes the federal government will allow up to 0.349 percent to give growers a little “wiggle room.” He said his department would work with farmers whose crop has slightly too much THC, though growers who are found to be deliberately trying to skirt the rules could be referred for criminal prosecution.

Strain said he expected between 100 and 200 growers will be interested and expects them to plant between 60,000 and 80,000 acres or more. Licensees will have to pass a criminal background check.

Seeds will need to be certified by the state or a credible third-party agency. Strain said he wants to protect the farmers from buying faulty seeds and ensure invasive species don’t hitchhike on the hemp program.

State Sen. Francis Thompson, D-Delhi, expressed confidence LDAF will carefully regulate the program.

“If we have bad players, we could all be embarrassed by this,” Thompson said.

The Joint Agriculture Committee lacked a quorum to formally approve the state's program framework, but members urged Strain to keep moving forward with an eye toward legislative approval later this year.