What is the legal status of hemp?


Many state laws related to cannabis have changed in recent years, but for hemp, federal prohibition began to loosen in 2014.

The 2014 Farm Bill formally defined industrial hemp and allowed state departments of agriculture and universities to grow hemp for research purposes. This likely paved the way for the 2018 Farm Bill, which now makes it legal for farmers to grow, process, and sell hemp in states that allow it.

However, state and federal laws regarding the cultivation, processing, sale, and testing of hemp and CBD products continue to evolve. In this irregular environment, it can be difficult for entrepreneurs and farmers to understand what’s legal as they explore opportunities in this blossoming market. 

Here’s an overview of the history and contemporary status of hemp laws to help you assess the risks and rewards of growing hemp.

The Legal History of Hemp in the U.S.

It’s well established that a number of the nation’s founding fathers and presidents grew hemp on their lands in Virginia and Pennsylvania, making hemp cultivation one of the oldest American traditions. In fact, there was little to no restriction on the cultivation of hemp up until the early 1900s when the first laws prohibiting “narcotic preparations of hemp” began to place limitations on how cannabis could be used and the 1937 Marihuana Tax Act made hemp cultivation complicated and unappealing to most farmers. 

These laws did not effectively distinguish industrial hemp from its psychoactive cannabis cousin, “marijauna,” a term used to classify intoxicating cannabis cultivars in a legislative context. With the exception of a brief push from 1942 to 1945 when the U.S. government encouraged farmers to grow hemp to support the U.S. war effort during WWII, laws relating to cannabis and by extension hemp gradually became more restrictive over time. This culminated with passage of the 1970 Controlled Substances Act (CSA), making no distinction between hemp and marijuana and making cannabis a Schedule I substance with the strictest constraints on its cultivation and use.

The 2018 Farm Bill Gives States Authority Over Hemp

The 2014 Farm Bill established the legal definition of industrial hemp as “the plant Cannabis Sativa L. and any part of such plant, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than 0.3 percent on a dry weight basis.” 

With this baseline established, the 2018 Farm Bill goes further and puts real legal protections in place for hemp growers by designating the plant an agricultural product instead of a controlled substance

States are now able to apply for primary regulatory authority for hemp production within their borders by submitting a plan to the USDA outlining processes for tracking crops, testing yields, and disposing of plants that exceed the allowed 0.3% THC concentration limit. 

Once the USDA has reviewed and approved of a plan, state lawmakers must decide on policies related to licensure, seed certification, and other matters related to how hemp crops can be sold and used commercially.

The USDA still maintains oversight over hemp on the federal level, but the 2018 Farm Bill does protect states and hemp growers from interference from other federal agencies like the DEA. 

It’s important to keep in mind that the Farm Bill restricts participation for individuals convicted of a felony relating to a controlled substance under state or federal law for 10 years following their conviction.

The additional benefits of the USDA’s oversight include a ruling that interstate commerce of hemp is allowed and that the transportation of hemp is legal even if the shipment travels through a state that does not allow the growing of hemp. 

Equally important are federal programs related to crop insurance, farm loans, and conservation programs that are now available to hemp growers and make planting hemp much more inline with traditional crop choices.

State Laws for Cultivating Hemp

While the 2018 Farm Bill does outline federal statutes for hemp cultivation, it is critical that those interested in growing hemp research the laws and regulations within their home states

Many states have implemented their own regulations regarding how much of the crop a farmer has to test, but not all states have chosen to approve the cultivation of hemp as an allowed agricultural practice. 

Idaho, Mississippi, and a number of U.S. territories do not allow for hemp to be grown within their borders. 

State laws can vary widely on how to apply for a license to grow hemp, and also on issues related to whether or not hemp and derived products may be used in food or for other commercial purposes.

In most states, the Department of Agriculture, Department of Natural Resources, or another regulatory body will have information related to applying for a license to cultivate hemp. 

Reading through these laws will help those interested in growing hemp understand the risks, barriers, and state agencies involved. If you want to learn more about regulations in your state, visit their Department of Agriculture website to find relevant info and resources. 

You can also learn more about state-by-state regulations here or keep up with updates to the U.S. Domestic Hemp Production Program.

The Legal Future of Hemp

After providing a period for public comment, the USDA issued an Interim Final Rule to the establishment of the Domestic Hemp Production Program. These rules represent the final regulations of the 2018 Farm Bill and went into effect on October 31, 2019 and will be operational until November 1, 2021. 

While revisions to these rules are possible, it’s unlikely that much will change before 2022. 

The Interim Final Rule cleared up confusion regarding the transportation of hemp across state lines as long as the batch tests below the legal THC limit of 0.3%. However, it’s possible that THC concentrations may change over time or due to storage conditions. These and other grey areas may need to be sorted out in coming years. 

Because hemp and marijuana are both forms of cannabis, the possibility of legislative action on cannabis and marijuana after the 2020 General Election leaves some uncertainty for hemp. However, it’s unlikely that hemp rules would become more restrictive and many expect constraints to loosen instead.

Additionally, as the crop becomes more of a staple in U.S. agricultural markets and demand for CBD and other hemp derivatives grows, it remains to be seen if there will be changes to regulations surrounding the exportation or processing of hemp. 

For a more thorough overview of hemp’s legal future, read through the USDA’s report on the economic viability of industrial hemp.