What's the legal future of hemp in the U.S.?
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Hemp has come a long way in the United States, from being an American household staple in the 1700s to being ruled a deadly substance in the 1970s the establishment of the country, hemp has been a household staple for Americans. What was once seen as a "taboo" crop is now gaining widespread acceptance and popularity. Thanks to the 2018 Farm Bill, which legalized hemp at the federal level, the legal hemp market is booming.¹ But even though the bill defined hemp as cannabis with less than 0.3% THC by dry weight, each state is implementing its own laws and regulations regarding the cultivation, distribution, and sale of hemp and hemp-derived products like CBD. In this article, we're taking a closer look at the current state of the hemp and CBD industries in the US in 2023, including new bills and measures shaping the legal hemp market.
Hemp and CBD at a glance
The CBD and hemp industry is rapidly growing, with an increasing number of people using hemp-derived products for various reasons. In 2022, the global hemp industry was worth a whopping $6.8 billion, and CBD was worth $4.17 billion.²⁻³ The booming hemp and CBD industry are benefiting consumers, creating jobs, and stimulating the economy.
With the increasing demand for hemp-derived products, many new businesses have emerged, providing employment opportunities for people across the country. Additionally, the industry has helped support farmers and agricultural workers who grow and harvest hemp. Many new innovations are on the rise, too— we'll break that down in the next section.
How is hemp used?
Hemp is a versatile plant that can be used in various industries outside CBD as a sustainable material such as for clothing, construction and as a plastic alternative.⁴
In the clothing industry, for example, hemp is often used as an eco-friendly alternative to cotton, a water-intensive crop that requires a lot of pesticides. According to a report, the global market for hemp clothing is expected to reach $10.1 billion by 2028, indicating significant growth in the industry.⁵
Hemp is also being used as an alternative to traditional insulation materials, such as fiberglass and foam.⁶ Hemp insulation is made from the stalks of the hemp plant and offers a more environmentally sustainable option for insulating homes and buildings.
Other industries are also starting to explore the potential uses of hemp. For example, hemp is being used as an alternative to plastic in the form of bioplastics, which are more sustainable and biodegradable than traditional plastic.⁷ Additionally, hemp is being researched as a potential replacement for conventional building materials, such as concrete and wood, due to its strength and durability.⁸
Overall, the growth of hemp in these industries and others is a promising sign for the future of sustainable and eco-friendly hemp material as a replacement for harmful and wasteful products.. As more people become aware of the benefits of hemp, its use will likely continue to expand and innovate in a wide range of industries beyond CBD and wellness trends.
What about CBD?
Even with all of the different hemp applications, when most people think about hemp, they think about CBD and other hemp-derived cannabinoids. The CBD wellness trend has become popular due to its potential to provide natural relief for various health concerns, such as anxiety, pain, and sleep issues, without the psychoactive effects of THC commonly found in cannabis. Additionally, the growing interest in non-pharmaceutical health practices has contributed to the popularity of CBD as a wellness product.
CBD users come from all walks of life. According to polling, women tend to be more likely to use CBD than men, especially in the case of managing anxiety. More people have become comfortable with using CBD for some health-related reasons. In fact, most people turn to CBD for pain relief, anxiety, and better sleep, according to the survey.⁹
Rules and Regulations
So why does any of this matter? To look at the future, it's crucial to understand the past. Hemp was legalized with the 2018 US Farm Bill, which helped legitimize the industry, and created a pathway for safe production and disruption of consumer hemp products. One of the most significant changes was how hemp was defined - the bill stated that hemp is cannabis with less than 0.3% THC by dry weight, which took it off the list of controlled substances. This meant that hemp was now legal at the federal level, which was great news for people who wanted to grow, process, or sell it.
However, each state still had the power to regulate hemp within its borders. The bill allocated funds for the research and development of new hemp-based products and made hemp eligible for crop insurance programs. Finally, the bill allowed for the transportation of hemp and hemp-derived products across state lines as long as they were produced in compliance with federal and state laws.
But that's just it.
Since states have the largest say about what is and isn't legal in their local industry, there has been quite a bit of confusion for consumers and businesses alike as legislature evolves nationwide. Each state has to work to recreate the wheel with each emerging industry and find what works best for them and their residents.
For starters, some conservative states are cracking down on full-spectrum CBD since it contains up to 0.3% THC, which is still a Schedule I substance on a federal level.¹⁰ Some states are passing laws to regulate different hemp-derived cannabinoids, including those that can synthesized from CBD, delta-8 THC, and delta-9 THC. These products may be hemp-derived and align with federal regulations, but many states have pushed to ban these substances for their lack of testing and existence in a legal gray area. Both factors contribute to an influx of mislabeled products that may pose a risk to the general public.
On the other hand, other states have seen potential benefits.¹¹ Legalizing hemp may lead to job creation and increased economic activity in rural areas, particularly for farmers and agricultural workers who can grow and harvest the crop. Hemp can also be used to make a wide variety of products, from clothing and paper to food and beverages, which might help drive local manufacturing and sales. Additionally, the demand for hemp-derived products, particularly CBD, has been on the rise in recent years, which may lead to increased tax revenue for states that allow the production and sale of these products.
What's next for hemp and CBD?
Given the disparities between state and federal laws and the bridge between CBD businesses and consumers, many people believe that more regulations are needed to keep consumers safe. Since CBD is still being researched, new rules would benefit people who use CBD by ensuring that risks are minimized and that people know what they're getting is safe, legal, and compliant with local and federal regulations.
The FDA recently agreed that the regulations in place for CBD are not appropriate for regulatory oversight and risk management.¹² However, nothing is changing just yet— these proposed changes are only just beginning to be brainstormed. The FDA needs to minimize risk, and the public needs more CBD research to balance the industry.
The House Agriculture Subcommittee on Biotechnology, Horticulture, and Research held a congressional panel in the summer of 2022 to discuss improving rules on hemp production.¹³ Over the course of this year, lawmakers will draft a new five-year farm bill to replace the current legislation.
Proposed improvements included addressing the FDA's stance on CBD products, raising the THC threshold in hemp products, revising bank regulations, removing the DEA's lab testing requirement, and providing a USDA stamp of approval for interstate shipment of hemp.
These improvements may ensure the safety and quality of hemp products and help companies obtain loans for building thriving businesses. The public can provide feedback on the new farm bill through the United States Senate Committee on Agriculture, Nutrition, and Forestry's website.¹⁴
Additionally, lawmakers are beginning to recognize the unjust impact of past drug convictions on those who want to work in the hemp industry, with a proposed bill aiming to eliminate the hemp industry ban for people with past drug convictions.¹⁵
Many people in the United States use CBD regularly for its potential benefits, such as managing pain, reducing anxiety, and improving sleep. However, hemp is a multi-faceted crop serving many different industries. As the demand for hemp continues to grow, we believe that more research will serve the collective to ensure CBD is a safe, consistent, and tested product nationwide.
The future of the hemp industry still looks bright as the demand for hemp-derived products continues to grow, and new laws and regulations are being introduced to encourage a more diverse and sustainable industry.
However, it is essential to remember that regulations and laws can also threaten the industry and harm consumers, so hemp and CBD users must make their voices heard and advocate for policies that protect their health and livelihoods. Some proposed regulations may be based on outdated stigmas that associate hemp with recreational cannabis and lack scientific or historical support.
Knowledge is power, which is why it's important to do your research and advocate for a better hemp and CBD industry. When you’re aware of the politics impacting your community, whether it be education, infrastructure, or hemp, you feel empowered to vote for local and federal measures, like the ones we outlined above, that support the industry.