How the 2024 Farm Bill May Impact the Cannabis Industry

How the 2024 Farm Bill May Impact the Cannabis Industry

The Farm, Food, and National Security Act of 2024 (2024 Farm Bill) could bring about big changes for the hemp industry. The House of Representatives released a draft discussion of its bill on May 17, 2024, which would make a significant distinction between industrial hemp products and “intoxicating” hemp products, the latter of which would be subject to more stringent oversight.  

Hemp Regulation Under the Farm Bill

As our cannabis attorneys have discussed in prior articles, the legalization of hemp under the 2018 Farm Bill resulted in a surge of new hemp products, ranging from textiles to CBD gummies. The landmark law removed “hemp” from the Controlled Substances Act’s (CSA) definition of marijuana, which means that cannabis plants and derivatives that contain no more than 0.3% THC on a dry-weight basis are no longer controlled substances under the CSA. In doing so, it also removed restrictions on the sale, transport, or possession of hemp-derived products.

While states, including New York and New Jersey, have established regulatory schemes for hemp, federal regulations have lagged in comparison to the explosion of hemp products. Critics argue that the largely unregulated marketplace poses safety risks to consumers, particularly with regard to minors’ access to intoxicating hemp products.

New Farm Bill Creates Two Categories of Hemp Products

To address these concerns, the House’s 2024 Farm Bill makes a distinction between “industrial hemp” and “hemp grown for cannabinoid extraction.” In doing so, the bill seeks to address what some see as a regulatory loophole for the sale of products containing potentially intoxicating cannabinoids other than delta-9 THC, such as delta-8 THC and tetrahydrocannabinolic acid (THCA).

Under the proposed bill, the term “hemp grown for cannabinoid extraction” is defined as “any hemp grown for purposes of extracting cannabinoids intended for human or animal consumption, inhalation, or topical use.” Meanwhile, the term “industrial hemp” means hemp:

(A) grown for the use of the stalk of the plant, fiber produced from such a stalk, or any other non-cannabinoid derivative, mixture, preparation, or manufacture of such a stalk; (B) grown for the use of the whole grain, oil, cake, nut, hull, or any other non-cannabinoid compound, derivative, mixture, preparation, or manufacture of the seeds of such plant; (C) that is an immature hemp plant intended for human consumption; (D) that is a plant that does not enter the stream of commerce and is intended to support hemp research at an institution of higher education (as defined in section 101 of the Higher Education Act of 1965 (20 U.S.C. 1001)) or an independent research institute; or (E) grown for the use of a viable seed of the plant produced solely for the production or manufacture of any material described in subparagraphs (A) through (D).

In essence, by differentiating between the two types of hemp products, the 2024 Farm Bill would make it easier for them to be regulated differently. While intoxicating hemp products would remain legal, they would not enjoy the reduced regulatory burdens that the bill establishes for industrial hemp products. For instance, the proposed hemp legislation empowers the U.S. Department of Agriculture (USDA), states, and Indian tribes to authorize visual inspections and “performance-based sampling methodologies” for industrial hemp producers. The 2024 Farm Bill would also authorize the USDA, along with state and tribal regulators, to eliminate a policy prohibiting individuals with felony drug convictions in the past 10 years from being licensed as industrial hemp producers.

Proposed Farm Bill Amendment Seeks to Ban Intoxicating Hemp Products

Some members of Congress believe the House discussion draft does not go far enough to address intoxicating hemp products. On May 22, 2024, U.S. Rep. Mary Miller filed a proposed amendment to the House 2024 Farm Bill that would effectively close the loophole by excluding products with detectable amounts of THC as well as any cannabinoid “synthesized or manufactured outside of the plant.” Under the proposed amendment, most products containing delta-8 THC and other hemp-derived cannabinoids would again be illegal under federal law.

“I am offering an amendment to close the loophole that legalized intoxicating hemp products like ‘Delta-8,’ which is being marketed to teenagers and children,” Rep. Miller said in a statement posted to the social media site X. “These drug-infused products are often sold in colorful packaging next to candy and snacks, which parents strongly oppose!”

As expected, the hemp industry has come out strongly against the amendment, arguing that it would impact a wide range of hemp products. “By federally banning all ingestible hemp products with any quantifiable level of THC, the Mary Miller Amendment would result in federal prohibition of 90-95% of all hemp products on the market, even a large majority of popular, non-intoxicating CBD products that naturally contain trace, non-intoxicating amounts of THC in them,” U.S. Hemp Roundtable General Counsel Jonathan Miller said.

Our Cannabis Attorneys Can Help Hemp Industry Navigate Whatever Comes Next

Even if the Miller Amendment is defeated, the future regulation of hemp is set to be one of the most debated aspects of the 2024 Farm Bill. There are currently vast differences between the 2024 Farm Bills introduced in the House and Senate, which will need to be resolved. Notably, the current Senate version does not make a distinction between the two types of hemp products.

The 2018 Farm Bill originally expired in September 2023, with its funding provisions extended by Congress for another year. It is unclear whether lawmakers will be able to reach a consensus by September, when the current version is set to expire.

The Scarinci Hollenbeck’s cannabis attorneys understand that the shifting regulatory landscape leaves the hemp industry on uncertain footing. We will continue to monitor the status of state and federal hemp regulations and encourage impacted entities to contact us with any questions.

https://agriculture.house.gov/uploadedfiles/discussion_draft_ffns.pdf