2018 Farm Bill Sends CBD Demand Soaring
The 2018 Farm Bill passed by the United States Congress has been one of the most beneficial pieces of legislation that’s ever been passed in regards to cannabis law reform. While industrial hemp is only a first step in full legalization of cannabis, the 2018 Farm Bill has had a much larger & far-reaching impact for cannabis industry & cannabis reform than many experts thought. The 2018 Farm Bill has opened doors for a multitude of industries, leading to an economic boon, going unnoticed by many in the mainstream media.
One of the biggest economic effects that the 2018 Farm Bill has had on US industry, can be found in the agricultural sector. The 2018 Farm Bill legalized the growth & cultivation of industrial hemp in all 50 states by licensed farmers. As many farmers were seeing the crop they produced being bought outside of the country, or simply being asked not to farm by the USDA, the United States agricultural industry was in a steep decline. The rise and fall of the Ethanol craze and corn production of the early 2000s, had left many farmers looking for a new crop to farm. According to Reuters, Ethanol prices are at a 13-year low, meaning less money for farmers producing corn.
Industrial Hemp New Cash Crop for Farmers
All things changed with the introduction of the 2018 Farm Bill. Not only was industrial hemp a new crop they could grow, but it was also a crop seeing a huge spike in demand. Hemp is also a much more labor intensive crop to farm, leading to farmers being able to get higher prices for industrial hemp crops versus other popularly farmed crops.
While a difficult crop to grow, the multitude of uses of industrial hemp leads to a larger customer base than many farmers are used to as well. While we aren’t agricultural industry experts, I think anyone would be hard pressed to find a more versatile agricultural product than industrial hemp. Hemp and CBD oil can be used in a multitude of products and is also a more environmentally friendly, efficient, and safer product to use, then some of the product categories that it competes in.
While cannabis farming is nothing new to some states in the USA with legalized recreational marijuana and/or medicinal marijuana programs, exporting cannabis products to all 50 states is. Most of these states where medicinal marijuana are seeing increases in cannabis production and request for farming permits as well, thanks to more farmers willing to grow hemp instead of marijuana, or both.
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The many uses for industrial hemp is a driving force behind the spike in demand for industrial hemp, however CBD oil seems to be the driving economic factor behind the industrial hemp boom and the increase in agricultural production of the plant. As the nation recovers from an opioid epidemic, fueled by false advertising and a highly addictive product, pain patients everywhere are looking for an alternative to the highly addictive opioid treatment for pain. While not scientifically proven yet, many patients are seeing positive results using CBD oil as a treatment for pain and other common ailments like anxiety, depression, and gut problems.
Regulation Hurdles For CBD Oil
Even with the increasing demand from patients using CBD oil as a supplement, the problem for CBD oil producers, and users is that while industrial hemp may be legal, the plant does contain THC, which is still a banned substance. Also missing from the 2018 Farm Bill legislation was a distinction between CBD oil from hemp, vs. CBD oil from marijuana, and what is going to be classified as a drug, and what is not. While regulation for THC content has been set for growing the hemp plant, at 0.3% THC level, it has not technically been enacted to include CBD oil products. CBD is a chemical compound found inside the industrial hemp plant, lending to FDA regulation, and the missing clarifications have resulted in Congress and state legislatures racing to make the distinction.
Conflicting state and federal laws is another major hurdle for CBD oil producers and state legislatures to address. Most states seem to be embracing the new law and working hard at a state level to make CBD oil from hemp with less than 0.3% THC legal. However, other states like Louisiana have stalled legislation, looking for guidance from the FDA, who has scheduled a public hearing on CBD oil for May 31, 2019.
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While the FDA commissioner has stated that CBD suppliers should be on watch until they’ve issued guidance, he also hinted at the notion of the THC content factor could be the defining factor between legal CBD oil and regulated CBD oil, citing the example of fish oil regulations when testifying in front of Congress recently. The commissioner also stated his enforcement priorities regarding CBD oil right now are aimed at the marketing of CBD oils, and manufacturer’s making false claims about curing capabilities of CBD oil.
CBD Oil Products Driving Industrial Hemp Demand & Legislative Efforts
The major driving factor behind the push for new legislation is farmers and retailers looking to enter the industrial hemp & CBD oil markets. With major retailers like CVS and Walgreens looking to sell CBD products, demand for industrial hemp has never been higher in the United States. States and businesses both are looking to capitalize on the new revenue stream.
CNN Business recently reported in an interview between CNN Business correspondent Parija Kavilanz and Hemp Depot co-founder Andy Rodosevich, a major hemp and CBD producer out of Colorado. Mr. Rodosevich states that he planted over 5 million hemp plants in 2018 and looks to triple that number in 2019 in order to keep up with demand.
“The company planted 5.2 million hemp plants in 2018. “This year we are planting three times that number. We’re trying to keep up with demand for CBD and scale up production,” said Rodosevich.”
CNN Business “These hemp farmers are making a killing on the CBD industry” – https://www.cnn.com/2019/04/09/success/hemp-farmer/index.html
Other Hemp Products Seeing Increases in Demand
In the same CNN Business article, it states that New Frontier Data reported $1.1 billion in sales of hemp products in 2018, with expectations of that number doubling by 2022. Some cannabis industry experts put that at a much higher number, however, all the experts agree that the CBD oil market is pushing the increase in industrial hemp demand & the economic gains being seen by growers and distributors. Other hemp products like rope, clothing, and fiber are looking to see increases in demand as well, but CBD oil is clearly the most sought after hemp product right now.
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As industrial hemp enters the mainstream markets, legislators will be busy with cannabis legislation for a time to come. Hopefully, most states will embrace the new federal law enacted when President Trump signed the 2018 Farm Bill into law in late December 2018, and create legislation friendly to cannabis farmers and users. States like Texas have already removed hemp from their banned substances list, but a lot of work is left to be done.
One thing is for sure though, CBD oil demand is putting pressure on lawmakers to act, so stay tuned for more updates on legislation regarding CBD oil and industrial hemp legislation news. Thanks for reading, and be sure to check out our other Disciple 420 posts for more articles on the cannabis industry and CBD oil.
- 2018 Farm Bill – https://www.agriculture.senate.gov/2018-farm-bill
- USDA Hemp Program – https://nifa.usda.gov/industrial-hemp
- Reuters “U.S. ethanol prices drop to 13-year lows on bigger supply” by Michael Hirtzer – https://www.reuters.com/article/usa-ethanol/us-ethanol-prices-drop-to-13-year-lows-on-bigger-supply-idUSL2N1Y31EP
- FDA Public Hearing Announcement on CBD – https://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm635048.htm
- KY4MM YouTube Channel – https://youtu.be/b1vf4PxK1rs
- CNN Business “These hemp farmers are making a killing on the CBD industry” – https://www.cnn.com/2019/04/09/success/hemp-farmer/index.html
- Hemp Depot – https://www.hempdepotco.com/
- New Frontier Data – https://newfrontierdata.com/tag/hemp/
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