USDA Releases Long-Awaited Industrial Hemp Regulations
On Tuesday, Oct. 29, USDA released the text of its interim final rule for regulations establishing a domestic hemp production program. Since this is an interim final rule, it will be in effect immediately upon being published in the Federal Register. The 2018 farm bill legalized the production of hemp as an agricultural commodity while removing it from the list of controlled substances (2018 Farm Bill Provides A Path Forward for Industrial Hemp). Industrial hemp is defined as Cannabis sativa L. and required to be below a THC threshold of 0.3%. Hemp production is legal in 46 states and the farm bill allows Idaho, Mississippi, New Hampshire and South Dakota to continue to ban production of the crop within their borders.
Ever since the 2018 farm bill was signed, farmers, regulators, stakeholders and law enforcement have been operating in a state of uncertainty as they waited for USDA to release this guidance. As is always the case in such circumstances, the rule doesn’t make everyone totally happy and there are still a few lingering questions. However, the department deserves significant credit for putting together a comprehensive set of regulations for a complicated issue in a relatively short period of time.
General Overview on Regulations for Hemp Production
In order to produce hemp, a farmer must first be licensed or authorized under a state or tribal hemp program or through the USDA hemp program. If a state or Indian tribe desires to have primary regulatory authority over hemp production in their borders, they may submit a plan for monitoring and regulating hemp production to USDA. States that have already submitted a plan will be given the chance to reaffirm the plan they want USDA to evaluate, or to submit a new plan if desired. The rule also establishes a USDA plan to regulate hemp production in states or areas where hemp production has been legalized, but no approved state plan is in place. Farmers may not grow hemp in states that have not legalized its production within their borders. Once a license application has been approved, USDA will issue a license. License applications will not be approved until Nov. 30, and a farmer cannot receive a hemp production license from a state, tribe or USDA if he/she has been convicted of a felony related to a controlled substance in the last 10 years.
In addition to the land information that must be submitted to the appropriate state or tribe, licensed farmers are also required to report their hemp crop acreage to the Farm Service Agency. This will give USDA and stakeholders a better idea of how much hemp is planted and grown in the U.S., as it is currently difficult to obtain this information. FSA reports crop acreage, including hemp, but the hemp acreage is underreported because it was not mandatory for farmers to provide the information. However, the numbers that were reported provide a general idea of where in the country hemp is grown, and at least provide a lower limit baseline to start with (Figure 1).
Remaining Under the THC Limit and Testing Procedures
A key cause of heartburn for farmers was the potential of a hemp crop coming in at a THC concentration above the 0.3% threshold. Unfortunately, seeds grown in two different geographical regions can express certain traits differently, i.e., the same type of seed grown in two different parts of the country can produce one crop with THC concentrations less than 0.3% and another with plants above that THC threshold.
Stakeholders were hoping these regulations would provide some clarity on the testing process as there was little uniformity across states in how the crop would be tested; some states would just test the top 8 inches of a plant, while others would test 6 inches, and there was little consistency in how to build up a statistically significant sample of a farmer’s crop.
These regulations require the crop be tested within 15 days prior to the anticipated harvest. There is still some confusion surrounding this. For example, if a sample is pulled 15 days before anticipated harvest, would harvest be allowed if there is a backlog at the testing laboratory and the results are not back in time? The THC concentration typically increases as the plants mature, so a crop could potentially rise above the threshold if the testing process isn’t completed early enough in those 15 days. Additionally, does the 15-day window mark the beginning of harvest or the end of harvest? Some fields may take multiple days to harvest and could conceivably be started before but finished after the 15-day window closes. USDA is requesting public comment and information regarding this sampling and harvest timeline.
Testing procedures must ensure the testing is completed by a Drug Enforcement Administration-registered laboratory using a reliable methodology for testing the THC level. USDA has issued sampling and testing procedure guidelines in separate documents attached to this interim rule. Part of the reasoning for this is to allow the department flexibility as new technologies and procedures are developed over time. Setting the testing and sampling procedures outside of the interim rule allows the guidance documents to be improved without going through an all-out rulemaking.
These new rules acknowledge the statistical uncertainty that comes with sampling and testing a hemp crop for THC. The regulations allow for the inclusion of the measurement of uncertainty as laboratories report THC test results. Essentially, the measurement of uncertainty could be understood to be similar to a margin of error (or for the economists in the room: confidence interval). When the measurement of uncertainty (e.g. +/- 0.05) is combined with the reported measurement, it produces a range resulting in the actual measurement having a known probability of falling within that range. If the 0.3% THC limit is within the range, then the sample will be considered to be hemp under these regulations, and not rise to a controlled substance. For example, say a laboratory reports a result of 0.33% THC with a measurement uncertainty of +/- 0.04. The distribution ranges from 0.29% to 0.37%, and because 0.3% is within that range, the sample will be considered industrial hemp. Again, for the economists and statistics nerds tuning in, think of a hypothesis test that fails to reject the null hypothesis that the result is statistically different than 0.3%. The measurement of uncertainty depends on multiple variables, such as the equipment being used, the methodology of the test, the sample size, the sample quality and other variables, and as such it will vary with each sample that is tested.
These new rules also acknowledge the fact that a farmer may unintentionally produce a crop that tests over the limit despite their efforts to produce a crop that complies with federal law. The rule determines that a producer does not commit a negligent violation if they produce plants that exceed the acceptable hemp THC level as long as they use reasonable efforts to grow the plant and it does not test at more than 0.5% THC on a dry weight basis. Although a farmer testing above 0.3% but below 0.5% may not be negligent, the crop is still considered a controlled substance and must be disposed of accordingly. While states and tribes will differ in how they handle farmers who become negligent, at a minimum, if a farmer negligently violates a state or tribal plan three times in a five-year period, they will be ineligible to produce hemp for the next five years. Additionally, negligent violations are not subject to criminal enforcement action.
Disposal of ‘Hot Crops’
Before the release of the interim rule, some in the industry were hoping for flexibility in the disposal of “hot crops,” or hemp crops that test over the 0.3% THC limit. Many were hoping for rules that would let farmers dispose of the plants in a more productive manner, such as composting or for soil amendments. Farmers will put considerable time, cost and effort into the crop, and it would be a shame to have to completely destroy the product with nothing to show for it. Ultimately, this rule does not address this problem the way farmers hoped. However, this aspect of the rule was essentially out of USDA’s hands. If a crop is above the THC limit, it is considered to be marijuana under the Controlled Substances Act and must be disposed of accordingly. Laws and regulations for the procedures of destroying a controlled substance are not set by USDA, and so the department was constrained in how it could address this issue. It will have to be collected for destruction by someone authorized to handle a Schedule I controlled substance, such as a DEA-registered reverse distributor or a federal, state or local law enforcement officer. Farmers must document the disposal of the crop, which is now considered marijuana. This can be accomplished by providing USDA with a copy of the documentation of disposal provided by the authorized agent or by using reporting requirements established by USDA.
The issue of interstate commerce arises when something, like industrial hemp, is legal in some states and at the federal level, but illegal in other states. There are still four states in which growing hemp is not legal, and since the 2018 farm bill was passed, the issue of transportation has been somewhat of a grey area. As an example, earlier this year, Idaho state police seized a truck carrying $1.3 million worth of hemp cultivated lawfully in Oregon that was on its way to Colorado for processing. In the 2018 farm bill and in a legal memo USDA affirmed a state’s right to enact and enforce laws regulating the production of hemp within its borders, but explicitly stated that a state or Indian tribe may not restrict the transportation of hemp within its borders. These new regulations reaffirm that no restrictions on the transportation of hemp may occur, providing farmers access to nationwide markets.
Clarity for Financial Institutions
Prior to the rule, many in the banking sector were looking for additional clarity on the legal and regulatory landscape surrounding financing in the hemp sector. Even though hemp production was legalized under the 2018 farm bill, many banks concluded the regulatory uncertainty (especially when factoring in marijuana, which is legal in many states, but illegal at the federal level) presented too great of a legal risk and opted to not participate in financing hemp production. There has been some movement over the past year to provide additional certainty, including the passage of the SAFE Banking Act in the House. However, financial institutions still remain wary of participating in this market. The banking industry has been awaiting these regulations in order to develop their own procedures regarding deposits from hemp operations. Hopefully with the release of this rule, the banking industry will develop appropriate guidance, allowing farmers to obtain financing and utilize other financial services if they produce hemp.
Felony Background Check on Workers
The 2018 farm bill limited the participation of certain convicted felons in hemp production. A person with a state or federal felony conviction relating to a controlled substance is subject to a 10-year ineligibility restriction on producing hemp, with an exclusion for those who were lawfully growing hemp under the 2014 farm bill. A question that had been subsequently raised was whether or not this restriction would only apply to the owner of the operation applying for the license, or if this would apply to every employee on the operation. Basically, in an industry already suffering from increasing labor shortages, is it really necessary to limit the pool of labor by requiring every field hand, tractor driver or janitor be subjected to this background check before an operation can grow hemp? This is an issue where the rule provides much-needed relief and clarity for producers. When filing an application to grow hemp, farmers must provide a completed criminal history report, and if the application is for a business entity, the criminal history report must be provided for each “key participant.” The rule goes on to clarify that a key participant is any individual who has a direct or indirect financial interest in the business entity, such as an owner or partner. The definition does not include shift managers or field workers. Thankfully, these rules do not make it more difficult to secure reliable farm labor.
Crop Insurance and Other Programs
After the farm bill authorized industrial hemp as a covered crop under crop insurance, some of the insurance-related uncertainty was moderated when USDA issued a bulletin in early 2019 establishing that a farmer who derived part of his or her revenue from hemp would not be found ineligible to participate in the Whole Farm Revenue Protection Plan. The bulletin also stated that hemp as a commodity was not insurable for the 2019 crop year. Later in 2019, Congress included a provision in the Disaster Relief Act requiring the Federal Crop Insurance Corporation to offer coverage under WFRP for hemp in the 2020 reinsurance year.
This interim final rule does not necessarily provide more information or clarity about crop insurance but having the rule in place is critical for hemp farmers looking to manage their risk through crop insurance. For FCIC to offer the WFRP policy in 2020, this interim final rule must take effect this fall to provide USDA’s Risk Management Agency sufficient time to take the necessary steps for authorization and for producers to start their own steps to qualify for coverage. For the 2020 crop year WFRP is available for hemp grown for fiber, flower or seeds. In order to participate in crop insurance, a farmer will need to certify acreage with FSA and identify each field, subfield or lot in which hemp is grown. Additionally, a farmer will be required to have a contract for the purchase of the hemp before being able to purchase insurance. One key point that has been made by RMA is that a crop breaching the 0.3% THC limit is not considered a covered loss under WFRP, even if that may be driven by weather conditions.
These new regulations offer much-needed guidance for farmers and others involved in the production of industrial hemp. Importantly, we now have a better idea of how the crop will be sampled and tested for its THC content and what happens when a crop breaches the 0.3% THC limit. USDA has acknowledged some of the uncertainty surrounding testing and understands that a farmer could do everything right but still have a “hot crop” and should not be unduly punished for results outside of their control. Also, the rules, thankfully, do not make it more difficult to secure reliable farm labor and they reaffirm that states that have not legalized hemp may not interfere in the interstate transportation of the crop.
Having these rules in place make it possible for other agencies and industries, such as financial institutions and crop insurance providers, to begin establishing their own guidelines and procedures for dealing with industrial hemp. While it is impressive that the department was able to put together a comprehensive set of regulations for a complicated issue in a short period of time, questions remain about some aspects of hemp production. USDA is requesting public comment on these questions and it is important for farmers and stakeholders to participate in the process.
Grow your owm industrial hemp for cbd oil
Understanding the agronomic needs and best practices growing standards for industrial hemp grown in Florida is vital to pulling off a successful, profitable crop.
But because hemp was illegal to grow for nearly 80 years, there is a crippling lack of published resources and industry knowledge when it comes to growing industrial hemp, especially for Florida farmers.
This report, generated from Green Point Research’s work researching, advocating for and supporting the Florida-grown industrial hemp since 2016, is an introductory agronomic guide for Florida hemp growers.
What Is Industrial Hemp?
Industrial hemp is the same species as marijuana, ‘Cannabis Sativa.’ However, hemp has been bred away from producing tetrahydrocannabinol, aka THC, the ‘intoxicating’ cannabinoid in the marijuana plant. Think of it as a paste tomato versus a cherry tomato. The same species selectively bred for very different uses. Hemp cannot make you high.
The 2018 farm bill legalized hemp, removing it from the Controlled Substances Act, where it had been lumped in with marijuana since 1937. In June of 2019, Florida authorized state-grown hemp, in-line with the new federal hemp regulations. Under both state and federal law, hemp is defined as a cannabis crop harvested with a ‘less than .3 percent’ THC level. If a hemp crop goes over that limit, it is considered an illegal marijuana crop and must be destroyed (more about that below!).
What Are You Growing Your Hemp For? Food, Fiber or Pharma?
Hemp, which can mature in just a few months and produce up to 10 tons of biomass per acre, was traditionally grown for fiber, pulp, and food. With legalization, there is a keen interest in renewing hemp industries across all these sectors.
However, for this report, we will be discussing best practices for growing hemp for CBD production. The hemp-derived CBD market is booming, predicted to increase by 700 percent to a $23.7 billion market by 2023, according to the Brightfield Group.
Growing CBD Hemp In Florida
Soil and Temperature for Growing CBD Hemp in Florida
Hemp is best grown on a well-drained, aerated loam or sandy loam soil with adequate irrigation and a PH between 6 and 7.5. In Florida, hemp will grow on almost all of our farmlands except, as the saying goes ‘celery land’ (aka boggy, wet soils).
Water and Nutrient Requirements for Growing Hemp in Florida
Despite a reputation for growing like a ‘weed,’ a high-quality CBD hemp crop needs to be grown following ‘heavy feeding’ principles similar to corn. Healthy initial nitrogen levels are essential, though hemp is highly responsive to added biologics and nutrient inputs — applied as a foliar, a soil drench or through irrigation.
Hemp needs adequate irrigation, especially in the rapid vegetative part of its growth cycle. Flood, overhead, pivot irrigation and drip irrigation are all acceptable. Though when flowering commences, overhead irrigation is not recommended. It can lead to mildew, damage flowers and wash off CBD-containing resins
Spacing and Planting Recommendations
CBD hemp is typically grown as dense as 3 ft. bed centers with 3 ft. in-row spacing for a total of 5000 plants per acre. Or up to 8 ft bed centers and 4 ft in-row for 1500 plants per acre.
These plants get big. Spacing and density will depend on the time of year (wetter versus drier seasons) and a farmer’s cultivation plan. Choosing to plant into plastic mulch beds with drip irrigation can help to reduce weed pressure and conserve moisture.
Start With the Right Hemp Genetics!
Unlike food and fiber-grown hemp grown for tall, dense fiber stalks, CBD hemp production is grown to utilize the high CBD content from the unpollinated hemp flower.
Farmers must choose the right seed when they put in a CBD hemp crop. CBD hemp cultivars have been bred to produce high quantities of CBD and low quantities of THC. But cultivars adapted for different conditions will react differently. An Oregon-bred cultivar is not necessarily suitable for Florida.
Don’t Go Hot! Plant Hemp Bred for Low THC Levels
As part of harvest protocols, farmers are required to test and submit their crops THC levels to state authorities. If your crop is above .3 percent THC, it will be ordered destroyed. There are many new hemp cultivars bred for low THC content, but they may perform differently in different conditions making it critical farmers choose a Florida-proven cultivar.
Choose Cultivars Bred for Florida’s Climate and Light Conditions
Though hemp is very adaptable – some cultivars are hardy well below freezing – it is important to choose cultivars bred for Florida’s specific warm and wet weather conditions to avoid potential disease and mold issues.
Traditional European-bred hemp is a photo-period or ‘light-sensitive’ plant. It moves from the vegetative to the flowering stage when daylight is less than 12 to 15 hours a day. Florida-specific cultivars adapted to our southern latitude light conditions are available through Green Point Research seed list.
Feminized Seed and Seedlings
Hemp is a dioecious species. Meaning it produces both male and female plants (similar to spinach). If you are growing for fiber or seed, this is not an issue. But for CBD, which is concentrated in the unpollinated flowers of the female plant, a single male plant can greatly reduce your final CBD content.
Hemp farmers have several options to prevent male plants, based on pricing, growing methods, and ability. You can choose to purchase feminized seed, which has been treated to prevent males from developing and start your own transplants. (Direct seeding is not recommended for CBD hemp production). Or you can plant clones, which are taken from female mother plants, and be assured of the genetics and sex of your plants.
However, even if starting with feminized seeds (and sometimes even clones), growers are still advised to walk your fields for the occasional male plant – or hermaphrodite, a stressed plant that produces both male and female parts. It only takes one and nature does have a way of prevailing when it comes to reproduction!
Diseases and Pests in Hemp Grown in Florida
Because hemp is such a new crop to America, we have the advantage of not having too many diseases or pest issues, yet. But the disadvantage of not knowing what will become a problem.
In Florida, hemp farmers should be concerned with pathogens related to our humid and warm conditions. Powdery mildew, fusarium, botrytis, pythium, and root rot are all anticipated as potential problems best prevented with adequate plant spacing for airflow and applications of preventative biologics.
Pests are adapting to this new crop. The hemp russet mite (Aculops cannibicola) has been identified as a significant pest in Colorado hemp fields. But essentially any ‘piercing or boring’ insect may cause a problem and Florida growers are advised to watch closely for corn borers, aphids, thrips, flea beetles and similar type pests.
Testing Your Crop
Each hemp crop must be tested and proven to be under the legal limit of .3 percent THC at the time of harvest to legally sell it. However, testing throughout the growing life of your crop is a valuable tool for determining the rate of CBD and THC rise in your crop.
As both CBD and THC levels increase as the plant gets closer to maturity, weekly testing procedures determine the rate rise and from there you can figure the best time to harvest for the highest CBD levels that are still under the THC limits. Crop testing also is a great way to attract a good final sale, as biomass buyers pay the best price for high CBD biomass.
Plan Carefully For Harvest!
Many hemp growers make the mistake of not adequately planning for the harvest and drying process required for preserving the integrity of your CBD. Hemp produces a lot of biomass and it must be handled correctly.
Your final crop price will be dependent on every ‘percentage point’ of CBD your crop produces. Inadequate harvest procedures and improper equipment often leave much of a crop’s CBD resin in the field instead of at the processors where you want it.
Also, hemp must be properly dried or cured, to avoid mildew and mold which can ruin a crop before it is processed. Having an adequate shed, drying process or drying equipment is imperative.
Selling Your Florida Hemp Biomass
There are several ways hemp farmers sell their biomass, from signing forward contracts before planting, to finding biomass buyers and processors looking for biomass when their crop is harvested. However, you decide to do it, make sure you understand the process from beginning to end before signing a contract and work with a trusted, vetted buyer who has a proven record of commitment to the Florida hemp industry.
Ready to Take the Next Step and Start Growing Hemp In Florida?
Green Point Research has developed a proprietary “Green Point Method™” to ensure success for Florida hemp farmers.
A best-practices manual combined with cultivars suited specifically for Florida growers, the GPM provides the best-suited, Florida-specific hemp seeds, recommended growing practices specific for Green Point’s cultivars and Florida growers, and all our experience in knowledge in growing the best quality hemp biomass.
Contact Green Point Research TODAY to learn more and get signed up with our program specifically designed for Florida hemp grower’s needs.