Domestic hemp production rules finally arrive. 

It’s now been more than a year since the 2018 Farm Bill was passed and we are finally getting the first edition of the domestic hemp production program rules and regulations from the USDA.  Some days you just have to sit around and shake your head in wonder that they manage to do it even this quickly, especially when you contrast the actions of the USDA with those of the FDA or DEA, both of whom seem to be just as slow to produce actual work. 

According to the USDA website – 

Later this week, an interim final rule formalizing the program will be published in the Federal Register that will allow hemp to be grown under federally-approved plans and make hemp producers eligible for a number of agricultural programs. The rule includes provisions for the U.S. Department of Agriculture (USDA) to approve hemp production plans developed by states and Indian tribes including: requirements for maintaining information on the land where hemp is produced; testing the levels of delta-9 tetrahydrocannabinol; disposing of plants not meeting necessary requirements; and licensing requirements. It also establishes a federal plan for hemp producers in states or territories of Indian tribes that do not have their own approved hemp production plan.

The rule is backdated to October 31, and is already in effect, even though the final comments period has not expired. 

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Hemp production program includes testing and compliance provisions, and will set processes and procedures into place for entities that do not have their own regulations already created, and these will include Native American tribes as well as states.  

States or tribes can potentially manage their own backyards. 

States or tribes that wish to have regulations that supersede the federal program will have to submit applications to the USDA and receive approval prior to implementation.  Checklist items include continued identification and accounting for all hemp production materials from seed to sale, basically. 

Testing procedures must be carried out at DEA licensed facilities, and there is no way in place yet to create a registry of seeds and strains that will be considered compliant with the <.3% THC levels due to irregularities in crop yields based on geographic location.  We do find it interesting that you can plant the same seeds in multiple locations and the THC content will vary wildly from batch to batch for no other apparent reason than the location of the planting. 

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The USDA also states in the interim rules that they want to be absolutely sure that crops which are over the .3% THC threshhold are tested to sufficiently prove the entire crop is over the limit; it seems that they understand that hemp producers have no real need of higher THC production and given the alternative of losing their entire crop due to non-compliance, it’s unlikely that they are attempting to grow these products. 

The USDA is also looking into licensing more testing laboratories in order to process more hemp production products faster and more efficiently.  Labs will need to be certified by both the DEA and the USDA in order to qualify. 

Last but not least there are provisions in place for certification, disposal, compliance at multiple levels, and licensing.  The plan does not appear to address anything other than products, testing, and licensing, which is unfortunate since the USDA could likely bring a lot of weight to bear with Treasury and the ABA, in order to create a framework for legitimate bank accounts for hemp producers, which could, in turn, lead to legitimate banking for THC producers, at least more widely at the state level in both situations.  


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