HEMP: NORTH CAROLINA'S NEW CASH CROP?

• Author: Russell, Tyler J.
• Position: SPONSORED SECTION: CASH CROP

Something extraordinary happened in December 2018:

President Donald J. Trump signed into law the Agriculture Improvement Act of 2018, a.k.a. the "2018 Farm Bill." Farm bills are adopted by Congress from time to time to reauthorize and modify programs that address, among other things, commodity support, conservation, nutrition assistance, farm credit, rural development, research activities, forestry, energy, horticulture, and crop insurance.

The 2018 Farm Bill did more than that: it legalized hemp.

Hemp Is Legal

For years, hemp was considered a Schedule I controlled substance under the Controlled Substances Act of 1972. The reins were loosened a bit with the passage of the Agricultural Act of 2014, which authorized research institutions and state agricultural agencies to grow industrial hemp as part of a research pilot program. North Carolina then established its own pilot program and the NC Industrial Hemp Commission in 2015. Although that was a huge step forward for hemp in general, the authorizing statutes, and the rules and regulations developed as a result, were limited in nature and left major issues to speculation--like the legality of some commercial hemp activities and hemp-derived cannabidiol ("CBD"). Those legal ambiguities also largely prevented industry participants from accessing traditional banking services, insurance programs (like crop insurance for growers), and other commonplace business activities.

Now, though, hemp and hemp-derived cannabinoids, extracts, and isomers have been legalized on the Federal level. Some of its immediate effects include:

* Expansion of the legal definition of "hemp" to include all parts of the Cannabis sativa L. plant, "including seeds and all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than 0.3% on a dry weight basis."

* Amendment of the definition of "marijuana" under the CSA to expressly exclude "hemp" (as defined above) and to expressly carve-out of the Schedule I controlled substances list any tetrahydrocannabinols ("THC") that exist in "hemp. "

* States may, individually, determine whether to retain primary regulatory authority over the production of hemp within their borders. To do so, a state must submit to the US Secretary of Agriculture its plan to monitor and regulate hemp production. Importantly, that plan must include "a procedure for testing, using...