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Can Hemp Become a Multi-Billion Dollar Industry?

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The Congress has finally given its approval for the 2018 Farm Bill and this includes a provision that ends the ban on industrial hemp, the non-psychoactive component of cannabis that has been found to be very useful in various ways. The Farm Bill also allows farmers to cultivate hemp in the United States, allowing for a great potential in the economy since hemp can be used to produce a wide range of natural supplements.

Hemp Acreage Increased by 163% Last Year

Since early 1600s, hemp has long been cultivated in the United States. This was around the time when the first group of European settlers arrived in the country. During this time, hemp was used in making fiber, fabric, paper etc. In fact, the US Declaration of Independence was written in a paper made from hemp. In the 1970s, however, hemp was classified as marijuana and was deemed illegal to produce and distribute in the United States even though hemp contains a small amount of THC, which is the psychoactive compound responsible for giving users the feeling of high.

Hemp made a comeback in 2014 due to the provision of the 2013 Farm Bill that defined industrial hemp as a distinct form of marijuana, allowing for universities and agricultural departments to conduct research on hemp. This also gave license to farmers to legally cultivate hemp. Last year, 25,000 acres of hemp were grown in the country, which was a 163% increase from 2016. This is expected to greatly expand this year.

The 2018 Farm Bill

The Farm Bill defines hemp as a type of cannabis that contains less than 0.3% of THC, which is why it’s removed from the list of Controlled Substances. Furthermore, the bill has moved the regulatory authority of hemp to the Agriculture Dept. from the DEA. In the bill, hemp was defined to include all parts of the plants and the bill specifically lists down the cannabinoids or CBD, which was removed from the list of controlled substances. It also authorizes the funding for research and has allowed the issuance of crop insurance to farmers involved in cultivating hemp.

CBD’s inclusion has the potential to greatly expand the size of the industry of legal hemp. Wellness products made from hemp, a category that didn’t exist years ago, account for almost a quarter of the overall domestic hemp market.

A Game-Changing Event

Hemp advocates are confident that the legalization of hemp could be a game-changing event. This can greatly lead to a big boost in the economy since farmers will now be allowed to grow and produce hemp seed, fiber, oil, and extracts. Now that hemp is legalized, supporters are expecting hemp to become a major crop in the country and hopefully become the leader in the industry.

Now that farmers will be able to obtain federally backed insurance, there’s no reason that hemp will not be a part of the soybeans and corn industry that’s grown in more than 60 million acres of land each year.

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