What the 2018 Farm Bill Means for THC

It’s been nearly a year since the passage of the 2018 Farm Bill. As I sit back and reflect on the U.S. hemp industry over the last ten months, the progress is clear. Forty-five states have enacted hemp legislation, acreage has at least doubled since, and the market continues to grow. The data is clear; the good times will continue to roll. But consider for a moment, one of the lesser discussed implications of the Farm Bill – the legality and future of hemp-derived tetrahydrocannabinol (THC).

In order to understand what I’m getting at, we need to think about the legal definition of cannabis in the eyes of the federal government. Cannabis with a concentration of THC higher than 0.3 percent is classified as marijuana, and therefore, is still a schedule 1 controlled substance. Cannabis with a lower than 0.3 concentration of THC is industrial hemp, and federally legal.

Now, recall back in February 2018, when the Hemp Industries Association (HIA) sued the Drug Enforcement Agency (DEA), because the DEA was continuing to classify cannabidiol (CBD) as a controlled substance. This was because the DEA considered CBD to be a marijuana derivative. But four years earlier, the 2014 Farm Bill removed cannabis with a lower than 0.3 percent concentration of THC – industrial hemp – from the Controlled Substance List. And thus, CBD derived from industrial hemp was Farm Bill compliant, federally legal, and not a controlled substance; therefore, out of the DEA’s jurisdiction.

In the last year and a half since the HIA won the case, the DEA’s rhetoric has changed significantly.

Just two months ago the agency released a letter stating that industrial hemp was no longer their jurisdiction. And further clarifying that federal governance of all things industrial hemp are now under regulatory agencies like the FDA and the USDA.

But what if we apply this same logic to hemp-derived THC?

According to the language of the 2018 Farm Bill, cannabis is hemp if the dry weight of the plant material contains less than 0.3 percent THC; and for a finished consumer good the THC has to be below 0.3 percent. But given the precedent set by the HIA v. DEA. ruling, the derivative itself – the industrial hemp-derived THC – is no longer a controlled substance. Period.

So, what’s the implication?

Well, if things keep truckin’, the U.S. could be nearing upwards of 5 million acres of commercial industrial hemp cultivation by 2025. Given that legal hemp can have a concentration of THC up to .29 percent, how much THC would you have if you extracted it from a million acres of legal hemp, at let’s say a 0.2 percent concentration? My guess: enough to produce consumer goods on a commercial scale.

It’s just food for thought. But before you start making deals, remember, “watch each card you play, and play it slow.”