Federal Regulators Announce Rules for Commercial Hemp

Oct 29, 2019

The U.S. Department of Agriculture has announced new rules that help clear the way for commercial cultivation of hemp in the country, Hawaii  included.

In 2018, Congress legalized the growing of hemp with a THC content of less than 0.3 percent. THC, short for tetrahydrocannabinol, is the psychoactive chemical found in hemp’s cousin, marijuana.

Undersecretary of Agriculture Bill Northey said Tuesday on a media call that the new regulations will allow farmers growing hemp to access the full range of USDA programs, including loans, crop insurance, and disaster assistance.

Those programs will be made available starting in the 2020 crop year. Hemp producers will also be able to buy non-insured crop disaster assistance where crop insurance is not available.

The new federal rules take effect upon publication in the Federal Register scheduled for Thursday. There will be a 60-day public comment period.

The federal regulations will only apply to states that have legalized the cultivation of hemp and submitted a plan for enforcing those regulations. States can still prohibit hemp cultivation, but may not ban the interstate transporting of the crop. 

Hawaii has a limited hemp cultivation program, with 30 growing state licenses issued under a 2016 state law. Those growers are limited to 10-acre test plots and it was legally unsure to some grwers whether they could legally sell raw hemp crop to mainland buyers, where most of the commercial market exists. The 10-acre limit under state law remains in place, but the USDA rules now clarify that interstate transportation of hemp is legal and cannot be restricted.

Hemp is used to produce cannabidiol, or CBD, a non-psychoactive chemical that is sold to treat conditions ranging from joint pain to anxiety. None of those treatments have been validated by the federal Food and Drug Administration. The agency has approved drugs containing synthetic or purified CBD for treating seizures and anorexia.

Hemp can also be used to manufacture a variety of commercial and industrial products, including construction materials, textiles, rope.

The Hawaii Department of Agriculture told HPR that the state Legislature will need to pass a new law to expand the existing test program. A state-level implementation plan would also need to be drafted by the agriculture department and approved by the USDA.

The 2020 state legislative session runs from January until May, meaning that a new law likely would not be passed by lawmakers and signed by the governor until next summer.

Steve Rose, who runs the Maui Hemp Institute, told HPR that the delay likely means Hawaii farmers will not be able to start large-scale cultivation until 2021.

In July, Gov. David Ige vetoed a bill that would have expanded the existing state program, saying he wanted to wait until USDA rules were published. Other states, including New York and Oregon, chose to act ahead of the USDA and created commercial hemp programs based directly off language in the 2018 Farm Bill, which legalized hemp cultivation in broad terms.

Ige’s office did not immediately respond to HPR's inquiry on whether an expanded hemp program required legislative approval or could be implemented administratively.

Correction: This story originally stated that prior to the October 31st USDA guidlelines, it was illegal to transport hemp in Hawaii and in between states. Intra- and inter-state transort were not addressed in state and federal laws prior to the 2018 Farm Bill, leading some hemp growers to assume it was not permitted. As of OCtober 31st, 2019, states cannot prohibit the interstate movement of hemp.