Tuesday, February 12, 2019

Federal hemp legalization opens up new avenues of promotion and protection for growers and sellers

The legalization of industrial hemp in last year's Farm Bill has opened up a slew of new avenues for growers of the crop and purveyors of its products to help their operations, Liam Niemeyer reports for Ohio Valley Resource, a public-radio cooperative that serves Kentucky, Ohio and West Virginia.

When the 2014 Farm Bill allowed states to grow strictly regulated hemp crops, products such as CBD oil and everything from hemp lotion to hemp pasta began to hit markets in those states. But hemp existed in a legal limbo: the Drug Enforcement Administration still considered it a controlled substance like LSD and cocaine, though hemp has little or no THC, the psychoactive substance in marijuana its kick. THC is the only defining difference between marijuana and hemp.

Because hemp was illegal on the federal level, growers couldn't get crop insurance through the U.S. Department of Agriculture, qualify for research grants, or ship hemp seeds across state lines for faster and cheaper processing; and sellers of CBD oil and other hemp products couldn't produce televised ads, Niemeyer reports. And most banks wouldn't allow either growers or sellers to open bank accounts, which forced them to deal mostly in cash.

But in the 2018 Farm Bill, hemp was redefined as a legal crop, opening up more opportunities to serve the booming hemp market, which the USDA estimated was worth $820 million in 2017.

In the Ohio Valley, once a tobacco mecca, many farmers have welcomed the crop, which has been profitable because there's an existing labor pool of former tobacco workers ready to help, and because profit margins are so high for CBD oil, said Brian Parr, assistant dean of Murray State University's agriculture school. The crop must be harvested, dried, and extracted quickly to remain profitable, which he says can be iffy. "Parr said he thinks investing in hemp right now is risky because promised safety nets under the new Farm Bill, such as crop insurance, are probably still a year away," Niemeyer reports. "But that hasn’t stopped Ohio Valley farmers and some state government officials from charging ahead."

Some growers hope to replace declining coal jobs with hemp. "Pine Mountain Remedies manager Nathan Hall isn’t growing hundreds of acres of hemp like some farms in Central Kentucky," Niemeyer reports. "Instead, he’s growing hemp on a two-acre plot of land in Letcher County," on the Virginia border. Hall said he hopes hemp can bring income to the community and strengthen it. "Hemp is definitely a part of it, but it’s almost like a vehicle for how to create opportunities for people in the region who have access to these small, but productive acreages,” Hall told Niemeyer. "To me, that’s a big social impact opportunity to have them work with us."

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