Congress handed the hemp industry an early Christmas present this year when it passed the 2018 Farm Bill, officially legalizing hemp in the U.S. today when President Trump signed the bill. This new bill will radically alter the hemp and CBD industries in this country. Both of these industries are anticipated to experience unprecedented growth this year following full legalization.
Let’s take an inside look at the changes to our nation’s hemp policy contained in the 2018 Farm Bill and what that means for Kannaway as we take advantage of the new opportunities provided in the newly passed omnibus law.
The End of Eight Decades of Prohibition
Hemp has been on a path toward legalization since hemp cultivation was partially legalized for research purposes in the last Farm Bill. In 2014, Section 7606 of the Farm Bill — signed into law by President Obama — gave authorization to states to grow hemp for research and pilot programs. 35 states created hemp pilot programs under this policy to explore whether a domestic hemp industry was viable in the U.S.
Earlier this year, a provision was added to the 2018 Farm Bill that would fully legalize the hemp industry in the U.S. The bill, known as the Hemp Farming Act of 2018, was introduced by Senate Majority Leader Mitch McConnell (R-Ky.) with the goal of removing hemp from the Controlled Substances Act (CSA) and allowing it to be sold as an agricultural commodity.
This bill would eventually be folded into the 2018 Farm Bill, an omnibus set of laws that governs, among other things, agriculture in our country. The 2018 Farm Bill passed the Senate first last week, followed shortly after by the House of Representatives. The bill was then signed today by President Trump, officially making it law. It will take effect on January 1, 2019.
CBD and Hemp Industries Set to Explode
This change to U.S. hemp policy is expected to have an enormous impact on the hemp and CBD industries in our country. With federal acceptance of hemp as an agricultural and commercial commodity, hemp is expected to become an incredibly lucrative market in just a few years. Once introduced widely to the U.S. market, greater availability would drive demand ever higher. Newly legalized hemp is projected to be one of the 10 hottest food trends in 2019.
One critical part of the hemp market is, of course, products featuring CBD, like those distributed by Kannaway. The CBD segment of the hemp industry could grow to $1 billion in 2019, the first full year of legalization, after hitting $600 million this year. By 2022, it is speculated to reach an astonishing $22 billion.
Being an innovator in the hemp and CBD space, Kannaway is already looking at opportunities to take advantage of full federal hemp legalization in our business operations to continue to lead the way in the hemp and CBD industry.
What This Change Means for You and Kannaway
Kannaway anticipates that changes to U.S. hemp policy in the 2018 Farm Bill will have the potential to change the way we do business each day. Here are just a few of the differences to the hemp industry provided for in the 2018 Farm Bill.
The 2018 Farm Bill excludes hemp from the CSA, removing previous limits on the parts of the hemp plant that were allowed to be used commercially. That means that companies in the CBD space can use the whole hemp plant to create commercial products, including the hemp plant’s flowers, for the first time. This could potentially allow for improvements to the manufacturing process and the introduction of new products.
Although it is too early to tell for sure, it is speculated that the removal of hemp completely from the CSA will increase access to CBD products across the U.S., including in states that currently restrict access, now that hemp is fully legalized federally. However, some states have already hinted that they do not plan to alter their policies regarding CBD.
Kannaway is ready to explore these changes to see how we can better do business each day and support our mission of access to CBD for everyone.
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