Marijuana is legal now. What does it mean?
Recently, President Trump signed the 2018 Farm Law that legalizes the cultivation of industrial hemp. How will this affect the industry? Earlier this month, President Trump signed the 2018 Agriculture Act. One of the key provisions in this bill is that industrial hemp is now legal in the US. There is a lot of speculation right now about what the outcome of this new law will be. Some speculate that this will lead to the final removal of cannabis from the Controlled Substances Act and the end of the cannabis ban in the US. Others aren’t quite as optimistic, saying the bill will have little or no impact on the legality of cannabis. So the question remains where the effects will be felt. Which sector of the cannabis industry will change forever? Will the main effects even be felt in the cannabis industry?
What is Farm Bill actually doing?
First, let’s take a look at what the 2018 Farm Bill, just signed, actually does for Trump. The bill legalized hemp by effectively removing it from the Controlled Substances Act. Note that this only includes hemp and not cannabis plants containing THC. Cannabidiol, also known as CBD, the non-psychoactive component of cannabis that you may have noticed popping up everywhere from health food stores to your favorite local cafe, is missing from the bill language.
How could hemp legalization affect CBD?
How will this affect the billion dollar CBD industry since hemp is legal? Currently, the Food and Drug Administration (FDA) still has the final say on which CBD products hit the market and which don’t. This is unlikely to change anytime soon. For the record, the FDA still regards CBD as a “drug ingredient” and has yet to be approved as such. Cannabis advocates hope to change that, of course, but given that the people currently running the FDA are all holdovers from the pharmaceutical industry, we won’t see any easing of those rules anytime soon.
One thing to consider is that large companies are showing an increasing interest in CBD and are constantly releasing their own CBD products, such as beverages. The legal gray area that CBD exists in has kept some companies, like Coca-Cola, within reach. Reversing the FDA’s decision would undoubtedly encourage more companies to get involved.
How will the government regulate hemp?
The last thing to consider is how the government would regulate hemp and how strict the rules would be. One can speculate that the U.S. Department of Agriculture has restrictions on who can and cannot grow hemp. This, of course, would mean asking for permits, a move that would benefit large firms and ultimately harm smallholders.
Will this be beneficial to the industry as a whole? Yes, it probably will, but who will actually benefit from this bill remains to be seen.