2021 has barely started and two documents from the US government have already been published clarifying rules around hemp production and sale. The first was the FDA providing more information about their stance on hemp-derived CBD; the second was the USDA publishing rules for hemp production programs. In this article I’m going to go over notable aspects of each document and expand on how they could influence the direction of the industry.

We’re going to look at the USDA’s rules for hemp production first, these rules are adapted from comments received since the original set of rules were published in the 2018 Farm Bill. Since then, the USDA has approved 45 state and tribal hemp production plans. Only 29 of those plans have been implemented and submitted progress reports back to the USDA. Individual hemp producers can only apply for a growing licence from the USDA if their state or tribe’s hemp production plans have been approved. They’re anticipating a steady increase in individual license applications over the next several years (Table 2). 

The USDA has established protocols for the import of hemp seeds but has not established rules on the export of hemp products. They say they’ll help facilitate companies who want to export hemp should the demand arise. 

One of the requirements for every hemp production program is they must report their hemp crop acreage to the Farm Service Agency by physically visiting the office in their respective region. Whenever they want to change that acreage or change licencing/sub-licencing of hemp cultivation on their land they must report those changes in-person. They require the reporting of all changes because the USDA is obligated to provide ‘real-time’ information of hemp production to law enforcement.  

The USDA recommends, but doesn’t require, growers to use hemp seeds that have been certified. Seed certification involves growing seeds of a specific variety under different conditions to track the differences in characteristics. With hemp this is particularly important because seed certification will inform the grower if certain varieties could go ‘hot’ (>0.3% THC) under specific conditions. 11.8% of all hemp harvested after the 2018 Farm Bill passed went ‘hot’ and had to be destroyed.

The rules around testing for ‘hot’ hemp are extensive. The USDA in general is looking for a 95% confidence level that no more than 1% of total plants in a harvest exceed the THC limits. How each state or tribe achieves that testing goal is up to them, they have to submit sampling proposals individually for the USDA to review. There are considerations for research programs involving hemp, testing and selectively destroying individual plants is much easier in that environment than in massive outdoor fields. Evaluating and tracking testing compliance on a state by state and tribe by tribe basis is an interesting approach. It seems like a good way to sow confusion and administrative errors throughout the process. 

The parts of the plant the individual sampling for testing must be done on are defined. The sample must be flower material, this is where the cannabinoids are most abundant, leaving little margin for error if the plants go ‘hot’:

“Even though many commenters felt that whole plant sampling should be allowed, AMS is of the opinion that since THC is concentrated in the flower material of the plant, the flower material is more appropriate to test than the entire plant. AMS will modify the sampling requirement to state that the sample shall be approximately five to eight inches from the “main stem” (that includes the leaves and flowers), “terminal bud” (that occurs at the end of a stem), or “central cola” (cut stem that could develop into a bud) of the flowering top of the plant.”

The plants must be harvested within 30 days after testing to ensure cannabinoid content can’t drastically change, while providing enough time to do the testing to see if the crop is compliant before harvest. This window was increased from 15 to 30 days because they felt 15 days didn’t offer enough time for testing.

All labs testing hemp samples must be registered with the DEA to conduct chemical testing on controlled substances. Essentially, they’re assuming the samples aren’t compliant until you demonstrate they are. They’re delaying enforcement of these testing rules until the end of 2022 because not enough testing labs meet these stringent operational requirements. They’re hoping more labs can conduct this testing by the time these rules are set to be enforced.   

The rules around disposing non-compliant plants that test above the 0.3% THC threshold are lenient. They allow farmers to burn, compost, mulch and bury the crops among other methods. It seems as though they’re happy with any on-farm disposal method that makes the plant material not usable for standard cannabis activities. One interesting caveat is you must provide evidence: 

“Under this final rule, State and Tribal plans must still include procedures to verify disposal. This may come in the form of in-person verification by State or Tribal representatives, or alternative requirements the direct growers to provide pictures, videos, or other proof that disposal occurred successfully. Producers under the USDA plan must document the disposal of all non-compliant plants.”

The final parts of this document published by the USDA that I will share are some of the economic projections they provide related to the growth and sale of hemp, more tables like this can be found in the official document linked at the top:

The second news release, clarification on CBD from the FDA, relates to an article I’ve previously written on who pays for the R&D to create policy around cannabinoids. The FDA has now made it clear that they will fund studies looking at the toxicology and long-term impact of CBD on humans in addition to collecting real world data from states that already have CBD products legally being sold:

It’s important to note the FDA has no intention of validating claims themselves around the medicinal benefits of CBD. Their job is to ensure safety, since CBD is already being sold legally on the state level, and evaluate the body of evidence companies who desire to make claims will submit to them. The USA is in almost the same scenario that Canada is currently in, they have legalized all cannabinoids found in the cannabis plant, except for THC. The FDA is currently focused on CBD because it’s the most common cannabinoid apart from THC and it has an active market, what will the FDA do when the other cannabinoids start being sold on a larger scale? As long as the plant producing the ~150 minor cannabinoids yields less than 0.3% THC, all those cannabinoids are being derived from federally legalized hemp. I expect the FDA’s efforts to evaluate the safety of cannabinoids to expand significantly in the future.

In summary, the USDA has provided guidelines to grow cannabis containing less than 0.3% THC with greater ease than previous regulations. Allowing on-farm destruction of non-compliant crops is a big step towards normalizing the plant. There is still a ways to go; in-person reporting of harvests and any changes, strict testing requirements leading to the potential destruction of crops and the tight regulation of testing facilities will hamper the industry from getting a strong start. Luckily, the FDA has finally clarified that they are getting organized with collecting data on CBD and starting to fund R&D to establish policy on the federal level.