Tag Archive for: USDA

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Safe Banking and Hemp: Working Toward Resolution

At present, most if not all banking service providers take a risk-management approach to hemp business customers that presumes that they may be held liable for their clients’ compliance with USDA regulatory requirements, even though these laws have no explicit bearing on the legality of hemp in commerce. (All hemp is legal for commerce nationwide if it meets the statutory definition of hemp, without regard to the USDA Rule).

This creates an onerous burden on banking service providers and their clients that is a significant (perhaps the most significant) factor contributing to the refusal of many providers to offer services to hemp businesses, and explains the excessive fees charged by those providers who do choose to offer them. Thousands of hemp business all across the country contend with this issue, particularly with respect to obtaining payment processing for credit card transactions, which are the lifeblood for most hemp businesses.

These problems arise largely from the duality in current law pertaining to hemp: one legal standard for hemp products—the Federal definition of hemp in statute—and another for hemp production in the U.S.—the USDA Hemp Rule, which applies only for production on a small percentage of acres licensed for such production.

While NIHC remains hopeful that legislation will soon rectify this duality by redefining hemp such that the USDA Rule will be revised to reflect the same legal standard, this has yet to occur and this duality will nevertheless persist for products made before such a revision is enacted.

NIHC strongly supports the normalization of banking services for hemp businesses, and we welcome the concerted effort by proponents of the SAFE Banking Act to achieve this through the bill’s hemp provisions (Section 11).  Despite the unambiguous Federal legalization of hemp in 2018, businesses engaged in hemp commerce continue to face great difficulty accessing banking services due to the perceived lack of regulatory clarity. Even when businesses are able to access banking services, the costs are exorbitant—much like the struggles faced by businesses engaged in marijuana, which remains illegal under Federal law. By providing regulatory clarity to banking services providers, the bill would go a long way toward relieving these difficulties.

However, we are concerned that the bill’s definition of ‘hemp-related legitimate business’ will cause the bill to fall short in achieving this desired outcome. This is because the definition will exclude businesses that buy or sell hemp produced on 76% of the acres licensed for hemp nationwide and as hemp produced outside the U.S. That would significantly hinder the industry’s domestic growth and potentially erecting a technical barrier to trade (TBT) in hemp on the export market as well.

The problem presented by the proposed legislation is that hemp produced on 76% of the acres licensed for hemp nationwide in 2020 (including 4 of the country’s 5 largest state programs) is not subject to USDA regulations pursuant to the 2018 Farm Bill because they are in states currently under 2014 Farm Bill authorities for hemp production. Even after the 2014 authorities expire at the end of 2021 (unless Congress extends them again), hemp goods that were produced under 2014 authorities will remain lawfully in commerce long thereafter. Hemp produced outside the U.S. is also not subject to the USDA regulations.

Even though the definition states “where applicable,” this re-introduces the regulatory uncertainty that caused banking problem in the first place. Banking services will either continue to shun hemp businesses, or incur excessive costs for risk mitigation, based on the perceived hazard that the bill’s protections may not apply where the business engages in hemp whose production is not subject to the USDA regulations.

We also see cases where regulators themselves adopt a similar risk-mitigation posture. A case in point is the policy promulgated by USDA Rural Development that excludes hemp producers in 2014 Farm Bill states from eligibility for funding under the Value-Added Producers Grant program, thus depriving most of the industry and state economies of much-needed investment in hemp processing capacity.

If regulations issued by USDA are vulnerable to such misinterpretation, then regulations by other agencies with far less understanding of these complexities (such as those that will administer the SAFE Banking Act) are all too likely.

Ironically, without these technical corrections, the SAFE Banking Act could normalize banking services for legitimate marijuana commerce and fail to do so for most legitimate hemp commerce.

The NIHC continues to work with policy makers in both the House and the Senate to look for ways to make these technical changes become law.

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Hemp Keeps Up Quick Pace

The hemp industry is moving at the speed of change.

Our industry has faced its own unique set of challenges since the passage of the 2018 farm bill and these growing pains are to be expected. NIHC’s core mission is to be your collective voice in front of lawmakers and regulators. Yet, NIHC can’t be your voice without your input and participation to solve these hurdles, current and new.

Some issues have yet to be resolved.

For instance, businesses in the hemp economy need equal access to the banking sector. The CBD market needs regulatory certainty; specifically whether or not CBD can be sold as food, or a supplement, or perhaps both? Because hemp looks like marijuana; we need safe transit resolved because on the spot, law enforcement can’t tell the difference. This is why we’re in constant conversations in Washington, DC and with states about testing and proper documentation. This will ensure that those involved in hemp commerce, including law enforcement and the financial markets, can distinguish between hemp and marijuana. This includes the controversial Delta-8.

The USDA continues to promulgate approvals for state programs to license farmers while other federal agencies lag behind in regulations for downstream businesses. We need certainty, but we need patience and a thoughtful approach. Last years’ election brought significant change to Washington with a new President who is still filling important roles and a new Congress. Patience is a virtue.

We are excited to see and be a part of the National Association of State Departments of Agriculture (NASDA) initiative on one percent. But what our industry needs is a coordinated state and federal strategy. We still have state legislators introducing a patchwork of laws governing our industry at the local level all across the country.

 

What our industry needs is a coordinated state and federal strategy. We still have state legislators introducing a patchwork of laws governing our industry at the local level all across the country.

 

To illustrate, here are just two of many examples of what is happening at the state level.

In New York state, Governor Cuomo recently signed into law an adult use marijuana legislation which creates a new state regulatory agency for both hemp and cannabis. That might make it easier to have one regulatory agency with jurisdiction over hemp and cannabis, but we need to better understand the role of the state department of agriculture. We also need to answer the question, what will happen to the hemp industry? It now appears it’s more lucrative to grow high-THC products in the second largest state in the country. Is the compromise on smokable hemp (that smokable hemp can only be sold in dispensaries) a positive thing for the hemp industry? Only time will tell.

In Alabama, there is a new bill that has been introduced in the state Senate that would add delta-8 and delta-10 to the list of controlled substances in the state. We can applaud the Alabama state legislature for trying to tackle the problem of delta-8. But, we believe the Alabama state senate is going down the wrong road to solve an easy problem. Delta-8 THC, per the 2018 farm bill, is a legal part of the hemp plant that exists in the plant’s natural form in only a minuscule amount that has no psychoactive effect. The problem is that some in our industry are taking advantage of a loophole in the law to manufacture artificially high concentrations of delta-8 and add them to hemp products, resulting in levels of 10% delta-8 and higher to create a psychoactive effect that would not occur otherwise. Changing the statutory definition of hemp from .3 percent delta-9 THC to one percent total THC, as has been proposed by NASDA and other stakeholders, would eliminate this loophole and prevent psychoactive delta-8 THC products from entering the market as hemp or any other non-controlled substance.

NIHC is a growing by the day.

We have a ten-year plan and have consistently exceeded our advocacy and policy goals in our nation’s Capitol. In our plans, our policy and operating budget didn’t include state advocacy. That means we don’t have the full-time staff yet hired to monitor legislation at the state level. We have been working since the beginning of the year to build and execute a strategy for successful state advocacy, it just needs to be resourced.

We realize there is a lot going on in our industry and we’d love to have NIHC member feedback on what we should be engaging on in your specific state. If you think we need to engage on a particular issue, please email us at info@hempindustrial.com.

If you haven’t become a member yet, please consider joining NIHC so we can all work better together. 

Growing the Hemp Industry Begins with Quenching the Farmer’s Thirst for Knowledge

An Interview with NIHC Board of Director Robert White

As in most farm bureaus, at the Indiana Farm Bureau (INFB), they have a vision to keep agriculture in Indiana strong and vibrant, to provide quality food to Indiana residents and to protect the rural life they love. They are the largest grassroots farm organization in the state with more than 250,000 members, and offices in all 92 counties. Started in 1919, INFB is well-positioned as the Voice of Indiana Farmers, and well-equipped to assist the farmer to leverage industrial hemp.

NIHC caught up with board member Robert (Bob) White, INFB’s Director of National Government Relations, to discuss the state’s progress with the crop and the outlook for the future. In his current role, White is responsible for keeping the Indiana Congressional Delegation abreast of INFB policy. In 2017, he was chosen to be on the AFBF farm bill working group whose task it was to help shape the possible outcomes of the current farm bill. It was the sixth farm bill that White has worked on.

NIHC hopes that more Farm Bureaus get involved in the organization to bring unity and cohesion to the hemp farming community. “Indiana Farm Bureau has been a great partner and can show how a collaboration with other state-based Farm Bureaus can help promote the hemp industry overall,” says Patrick Atagi, NIHC Board Chair.

Here are Bob White’s thoughts.

Early Adaptor

White saw potential for hemp farming early on and has worked to keep his finger on the pulse of the movement. “I met Patrick Atagi, NIHC Board Chair, at a USDA’s Agricultural Outlook Forum about 5 years ago, and he told me of his idea to launch the organization. We have been connected ever since. I came on as a board member early on,” says White. White believes hemp has a big future ahead, once regulatory challenges can be ironed out. While all that’s being accomplished, White wants farmers and other farm bureaus to work together to get knowledgeable on the nuances of growing the hemp plant.

Being in the heart of the country’s farmland, White and the INFB want to help bring the state into industrial hemp farming with success.

“Indiana farmers have been discussing industrial hemp for quite a while. We are always looking for diversification away from corn and soybean, especially when prices were in the dumps about 8 years ago. We began talking about it then in Indiana through our participation in the Midwest Hemp Council. One of our INFB members, Jamie Campbell Petty, is its Executive Director, and has been working on state legislation as well as the ’18 farm bill, all to support the growth of industrialized hemp here.”

“Being involved with NIHC has also been a great resource,” says White. “One of the benefits of belonging to an organization like NIHC is that you are on the inside track on what is happening,” says White. “NIHC has basically stood the test of time as an organization. It is dedicated and deeply invested to keep industry moving forward. It provides good and factual information sources instead of disinformation, which flows from everywhere right now.”

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“There is a solitude about growing hemp that is attractive.”

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Hemp Rising

The thirst for knowledge on growing industrial hemp is growing, and many different avenues of education are available. “Even land grant colleges are getting involved,” says White. “They are spreading the word to educate farmers, along with local community colleges near rural areas. People want to know how to grow it and what to do with it. At the last Midwest Hemp Council meeting, we had close to 500 attendees, and half were farmers within 8 states. And, there were some who have never farmed.”

White noted how people who are not farmers by trade are leaving longstanding careers to grow hemp, mostly for CDB. “Many people want to see the fruits of their labor at the end of the day, instead of work that sometimes can take 5-6 years to see results. There is a solitude about growing hemp that is attractive.”

The lack of education and experience has unfortunately led to some of the failures of the industry that any budding niche might experience. It has also led to some of the misinformation that is pervasive in the industry today. To combat this, White wants to see more people getting educated on agronomics of hemp.

Hemp Agronomics 101

While the industry looks attractive and has that instant gratification appeal, White notes it takes more time to develop a business than most have given it so far. “It takes a while to learn to grow it. Early on, it took special treatment for soy and corn, too. We learned and they grew as commodities. There is still a lot of agronomics on the growing, planting, harvesting and processing of hemp to learn,” says White.

Farmers who are agriculturally-motivated to do something different with their land have so far tested the waters and planted crops. But the missing piece is demand. “Strong demand is missing. It takes a lot of capital investment to set up a fiber processing facility, which our state of Indiana needs. We have not reached a critical mass, not at that tipping point. More people will get involved, and as we learn, we will do what we farmers always do – we will turn it into a commodity,” notes White.

He even predicts the industry early adopters will reap the most significant profits of the industry expansion. “Hemp is a finicky crop. Those who are working out the growing process now will be able to jump back in successfully when things start to heat up. They will be ready to bring a harvest to a supplier with efficiency. It is important that farmers figure this out now while we wait for demand to rise.”

Resolving Issues

Industry obstacles are currently on their way to being resolved, slowly but surely, White says. “Organizations like the NIHC are at the forefront of these practical, legal and consumer awareness hurdles, and there is a future for industrial hemp on the horizon.”

“Legally, I don’t get much involved on that front – only when we lobby for leeway in THC levels. Right now in Indiana, we see a lot of crops being destroyed as the go-to law enforcement directive. There are other ways to handle the crop where the farmer doesn’t lose their whole investment, such as taking it to a fiber processing plant, where they take a ding on the price, but can still sell it as fiber as opposed to CBD.”

Law enforcement in Indiana, like elsewhere in the nation, is asking for testing options. They want to be able to test it on the spot to determine a course of action. “There needs to be a better certification process, for sure, and a path for law enforcement that doesn’t lead to all loads being destroyed or buried.”

On the consumer front, White sees promise in NIHC’s Hemp Checkoff program. “I think we need a checkoff just like other commodities. Farmers do see valuable benefits to a checkoff; we just want to get the timing right to launch it. Soybean, corn, beef and milk have successfully educated people about the products, and farmers saw a return on their investment.”

In the short-term, White believes farmers need to focus on the agronomics of industrial hemp – the growing, harvesting, processing, and sale. “Farmers cannot grow it and hope someone will buy it, maybe like they have done with other crops,” White says. “Let demand grow, and then plant it. Then the marketplace will also work out the issues like THC, certification, transportation and more to accommodate the end uses.”

“I think in 3 to 5 years, this industry will come into its own for the farming community,” White concludes. “They should keep paying attention, learning, discover their market, be conservative until all that is determined. Only then they can grow 1,000 acres of it.”

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“Hemp Industry is a Solid Product and a Rapidly Growing Market” – An interview with Doug Farquhar

NIHC caught up with board member Doug Farquhar, J.D.,to discuss his involvement in the council and the industry. He is an attorney with close to 30 years’ experience working with policy makers on environmental and health issues, primarily working with state legislatures.

In his prior work, for 21 years Mr. Farquhar directed the Environmental Health Program at the National Conference of State Legislatures, where he worked on the issue of cannabis edibles. The EHP performs legislative analysis and outreach on state and federal environmental, health and trade laws; focusing on the delegation and authorization of federal and state laws; and provides legal and technical assistance to state legislators and agency staff on state, federal and international environmental, environmental health, and trade policies. He also has provided expert testimony before state legislative committees and task forces; reviews and comments on legislation and regulations, drafts memos, articles and books on state environmental health policies; and represents state interests before federal and international bodies.
As director of Environmental Health he worked closely with federal counterparts at the Food and Drug Administration (FDA), U.S. Department of Agriculture (USDA), Centers for Disease Control and Prevention (CDC), U.S. Environmental Protection Agency (EPA), Department of Housing and Urban Development (HUD), and the Commission for Environmental Cooperation (CEC).

Now, he is currently Director of Government Affairs for the National Environmental Health Association.

What about the industrial hemp industry has compelled your involvement with NIHC?

This industry really appeals to me as an exciting emerging area; it is a rare thing to be on ground level of an industry such as hemp and cannabis provides.

It was very much untouched from a state level until the passage of 2018 Farm Bill allowing hemp to be sold and declassified as a schedule 1 drug. This opened a whole avenue for industrial hemp. It is a rare opportunity.

I have worked on the state level in health policies for a good portion of my career. It is at the state levels that the industry will have a chance to thrive. And, I think there is real opportunity for NIHC to 1) help states know how to track what they are doing and 2) prepare states on how to address the issues.

“NIHC has a clear role in creating opportunity in the marketplace though educating lawmakers and regulators on intended and unintended consequences of certain legislation. They can navigate the way through many of the agencies that have a card in the hemp deck to play.”

How can your experience help NIHC drive the hemp industry forward?

The federal government will do some of the work, but it primarily lies with the state and local governments to do most of the heavy lifting, which is where my expertise lies. State legislators want hemp to grow as an industry and want to promote it as a sustaining crop for their state. Yet, there are still so many unknowns with it that need to be worked through.

The state-to-state issue is also working itself out. It would normally take a federal law to bring about swift and sustainable state to state harmonization, but Congress typically hates to do that. They usually allow each state to work out issues within their boundaries when there is no overarching need for federal intervention. Hemp does not have a public health issue attached to it, for instance, that would necessitate such federal action.

But to give you an example of how the federal government couldcome into play in states’ harmonization, we can look at the labeling on biotechnology. It wasn’t until Vermont became the first state to make it mandatory by law that Congress that it passed their own law in a matter of weeks. There was direct incentive to harmonize biotechnology, where hemp doesn’t provide that immediate need right now. I really don’t see the federal government regulating hemp, at least for now.

States need to address industrial hemp from a marketing point of view. NIHC and the checkoff program can help.

If hemp is restricted on how it is grown and sold, people will not want to do it. Most importantly, those who would normally invest in industry-wide growth of new products will invest in tight regulatory environments. It is too risky. Plus, there is lack of available data to inspire what investors, farmers and producers they cando. These were some of the problems we saw with the edible cannabis issue that we had to overcome.

Early on, the state of north Dakota conducted a huge effort to get the ag community to grow hemp. They saw it as a viable market and encouraged the farmers to grow hemp. They did all kinds of stuff to encourage it, but the then-federal restrictions held it back. The barrier is now removed with the 2018 Farm Bill, but there is still work to do. The states have to get busy forming their programs.

What is the role of NIHC from your perspective?

NIHC has a clear role in creating opportunity in the marketplace though educating lawmakers and regulators on intended and unintended consequences of certain legislation. They can navigate the way through many of the agencies that have a card in the hemp deck to play.

From an environmental perspective, the growing of hemp is an extremely good product for agriculture. Whatever we can do to encourage this marketplace will be beneficial for farmers and for consumers. It is a very viable ag product, which is why the states are so interested in it. It will grow with the marketing and promotion of it, which NIHC can also play a critical role though the promotion of the checkoff program.

NIHC can be a guiding force as the industry evolves and matures. We don’t know what we don’t know yet, such as what pesticides are best and which fertilizers are suited for hemp. From an ag standpoint, there is much to learn, and data is coming sparingly. But there is no doubt we will learn what will make hemp industry prosper; people will figure it out.

What do you think is the most important aspect concerning the industrial hemp industry today?

Its growth and marketing. Getting it out there and people using it for products. Showing that it isa viable product. Breaking the stigma for investors to contribute. Anything to get it out there and get it known. The wonderful thing is that it does not have issues attached to it that could make it problematic from a public health and environmental standpoint, both which can be huge obstacles in other circumstances like we saw with genetically-modified foods.

There needs to be a proof of product that using hemp is better than what is currently being used.

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Getting to Know NIHC Member Rick Fox

 

NIHC Member Rick Fox

Owner, Meristem Farms, LLC

Morrisville, VT

 

Herrick (“Rick”) Fox has been a member of the NIHC since its inception and serves as co-chair of the NIHC Government Relations committee (GAC), with good reason. As owner of Meristem Farms, located in Vermont, he has an interest in securing a sound policy and regulatory foundation for hemp farms of all shapes and sizes, including smaller and independent farms like his, and he also has 15 years of policy, regulatory and management experience in USDA.

Prior to starting Meristem Farms, Rick finished his 15-year career at USDA as an executive in USDA’s Foreign Agricultural Service, leading a division in agricultural capacity-building. Before that, being a forester by profession, he worked with USDA Forest Service, first in land management on National Forests and later in forest policy with senior USDA officials and the U.S. Senate Committee on Agriculture. He also served as policy expert for USAID capacity-building programs in Russia and the Republic of Georgia, and in the 1990s he worked in Russia for 6 years on conservation issues and forest science research in Siberia and the Russian Far East.

Here is more about Rick, his operation, and his thoughts on NIHC’s potential.

 

Tell us a bit about your business.

We grow and manufacture specialty hemp flower products in Northern Vermont. We focus on bringing out the character of the plant and the land through the distinctive aromatic profiles of our varieties and the growing conditions in our particular neck of the woods.

My wife, Jen Daniels and I founded the company with a strong land ethic.  She’s a landscape architect and I’m a forester, and we both decided to leave the Federal government wanting to do something that more directly connects people with the land… what better way to do that than farm hemp for people’s health?  So we really try to focus on what makes each variety special with the land and microclimate where we farm.  Harvest season in Vermont is amazing, and we’re lucky to have regulations in Vermont that allow us to make the most of it.

 

How has your USDA experience helped you and the NIHC?

I was with USDA for 15 years, in a variety of management, rulemaking and senior policy positions, and I was lucky to detail to the Senate Ag Committee to help with the 2014 Farm Bill as well. Alongside helping Jen run our company, I know there aren’t many other folks in hemp farming with a USDA policy background, and fewer still who also have a background in science and statistics. So, I volunteer as much time as I can helping farmers, regulators and policymakers understand one another’s perspectives and the technical details that are critical to these regulations, in hopes that we can get better policy outcomes than what’s been put out there so far.  I enjoy the challenges of building a hemp farming company from scratch—terrifying though it has been at times—but in a lot of ways I’m still a ‘recovering bureaucrat’ and I miss public service so the policy work I do with NIHC is a way for me to do that.

 

What is the focus of the NIHC GAC in 2021?

Some of the things we are focusing on are the USDA rule and on developments in a few states, such as California and New York.  There still seems to be a lot of confusion on the part of regulators and policy makers about how their choices can impact smaller and independent hemp farms in particular.  What may seem like arcane details of chemistry, statistics and semantics actually put many if not most farmers at huge risk, and regulators too, and for no public benefit at all.  And, of course, regulations concerning hemp-derived products in foods and dietary supplements coming out of FDA and at the State level are a major focus as well.  Hemp has such huge promise, not just for farming but for the broader economy, our environment and society in general and I don’t want to see it derailed by poorly crafted regulations.

Right now, it’s all a moving target, but I’m optimistic that the new Administration will get it right and I also think their emphasis on the rural economy, equity, and climate-smart agriculture present important opportunities for hemp as well.

 

What is the role of the NIHC in all this?

NIHC has a high degree of professionalism and its leadership has longstanding history with USDA and other sectors that are important to hemp production. That gives NIHC an ability to be uniquely effective in interfacing with USDA programs and procedures for the benefit of the industry, as we’re seeing in its efforts with MAP and check off programs, for example.  I know first-hand that USDA is a complicated bureaucracy so I definitely appreciate that savvy.

I see NIHC working hard to become a big tent in the industry, supporting hemp farming of all kinds and promoting equitable value chains throughout the industry. We all share a grand vision of hemp for our future, but we recognize the need to serve the industry where it is today and help it grow in a way that brings everyone along. There is a lot of diversity in the hemp industry, all kinds of people and businesses – and NIHC is a voice for unity, so I’m proud to be a member.

There also needs to be better coordination with scientific and standard-setting organizations, and to make decisions implementable, with reasonable of expectations of success.  NIHC can play a major role in addressing those kinds of problems and clarifying confusion in the market.

 

What is the potential of hemp in your view?

Hemp has enormous transformative potential, not just for agriculture but for manufacturing and energy as well, and if we can get the regulations right and put hemp on that kind of trajectory, then I can imagine hemp becoming a keystone crop for our economy in the not too distant future.  Hemp is a great crop for CBD and other wellness products – that’s what we grow it for in my company – but though this will always be a significant part of the industry, the truly grand future for hemp is about food and especially fiber.

I also see hemp having huge trade potential. The world already knows American hemp is the best there is in the wellness market, and if we can unleash the ingenuity of American farmers and manufacturers I think we can easily become the world’s leader in climate-smart manufacturing and energy uses of hemp fiber, as well.  But this will require public investments in R&D very quickly or we could lose that edge to our competitors around the world, so I’m hopeful Congress and the new Administration can see their way toward making that happen.

Check out Meristem Farms!

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Next Bold Move in Agriculture – Industrial Hemp is Well Positioned for It

The future of industrial hemp looks bright as experts outline its potential at the 2021 National Hemp Symposium.

Industry experts from various private and governmental sectors convened this week for the first-ever virtual 2021 National Hemp Symposium, brought to life by the National Academies of Sciences Board on Agriculture and Natural Resources (BANR) and Oregon State University’s Global Hemp Innovation Center (GHIC).

National Industrial Hemp Council (NIHC)’s board member Patricia Sheikh, Senior Vice President of Roots of Peace, moderated the two-day event, along with organizers Jay Noller, Director and Lead Researcher, and Jeffrey Steiner, Associate Director, both of the GHIC. Sectors represented included energy/biofuel, automotive, environmental, USDA, food and nutrition, apparel, manufacturing, banking, food and pharma and defense.

The event explored industrial hemp potential as an up-and-coming top U.S. commodity on the national and international stage. Presenters outlined uses and opportunities from their sectors that could be significant streams of income for U.S. producers with adequate supply to meet demand – a concern cited by most of the presenters. Things such as wood replacement in construction, desirable fiber in apparel, and automotive parts were highlighted. 3M is testing alternative uses of hemp in their manufacturing as part of their commitment to sustainability.

The outlook is exciting and hemp is seen as a top contender that could significantly stimulate the American economy, once obstacles are removed.

NIHC’s Patrick Atagi presented an informative session on hemp commerce that reflected this potential. “We can absolutely change the world with hemp, it is amazing. There are so many ways to succeed,” he noted.

“Yet, there are many obstacles to getting hemp product to market, such as transportation,” Atagi continued. “Working at the national level to influence the Drug Enforcement Agency on their view of hemp enforcement will open up commerce.

“The federal and most state governments are not opposed to hemp. As an example, NIHC recently received $200,000 to promote U.S. hemp internationally through the USDA Market Access Program. NIHC is also pursuing a domestic marketing program through a national hemp checkoff initiative. A hemp checkoff has the potential to positively impact the industry in a substantive way similar to the ‘Got Milk’ campaign and ‘Pork the other White Meat’ checkoffs.”

In addition to protecting the hemp brand and marketing, which includes combatting negative attacks with positive data and facts, NIHC sees its role as a partner with the government, especially through participation on working committees. “As a recognized partner with USDA, it puts NIHC at the table in international negotiations, with their seal of approval. To be competitive in these markets, like Asia and Europe, we need solid research on what those unique consumers want, what they like, to avoid the unintended consequences of not knowing.”

Ultimately, there are many hurdles including standardization, certification, and testing here in the U.S. that must be addressed, says Atagi. “The consumer has right to know what they are buying and to feel safe. They want to know ‘what do I buy’ and ‘how much do I take.’”

Bonny Jo Peterson of the Industrial Hemp Association of Washington, and co-presenter to Atagi’s session, agreed. “We want to grow, harvest and automate an industrial hemp crop for a sustainable market, which produces a quality product that people can trust. We really need standardized testing and labs. We need to all be on the same playing field.”

Dr. Dionne Toombs, USDA, outlined their efforts to do “worldwide testing and research in our labs.”They are investing $66 million in an Agricultural Research Service lab intended to enhance research, which will include hemp, she says. Toombs also referenced the Farm Bill of 2018’s provision for National Institute of Food and Agriculture hemp research investmentsand the Supplemental and Alternative Crops (SAC) Competitive Grants Program, both which have their challenges and limitations, but are moving the needle in the right direction.

Looking ahead, Toombs says, “We are facing a future of challenges that will hurt us, that are attacking our natural resources.” She believes boosting ag productivity and helping to develop innovative solutions to maintain our leadership across the globe are the keys to the future, in which hemp has a role. She cited funding and resources, realigning priorities with the New administration, food and nutrition standards, and having enough data to make decisions as current USDA obstacles.

Symposium participant Deanie Elsner, CEO of Charlotte’s Web – a market leader in hemp-derived CBD extract products – made an impactful plea for regulations and standardization, an issue the plagues her business. “Have you ever known a CEO for the largest company in a segment begging for research? Well I am here begging. We have to get data in order to give the FDA comfort to move forward,”she said in regards to the need for regulatory certainty and an affirmative statement for CBD in dietary supplements.

She believes the mega-trend she calls a “wellness awakening” – a move from sick care to well care – is driving increasing consumer interest in hemp products. “In the end, we have this amazing plant that has potential to help millions around the world. It is up to us to make sure they have the access to full spectrum hemp extract. Research studies are needed. Research is the only thing that will get us through this, and lack of FDA regulation has been quite a challenge.”

NIHC Meets with USDA Acting Secretary

WASHINGTON – National Industrial Hemp Council (NIHC) Board Chair Patrick Atagi, released the following statement after NIHC’s meeting with the Acting USDA Secretary:

“As we continue to lead the industry as the only D.C.-based hemp trade association, we felt it was important to update Acting Secretary Kevin Shea on a number of issues including consumer safety and climate smart agriculture. After today’s meeting, we’re confident that Secretary-designee Vilsack will be fully briefed on the issues facing the hemp industry.

“We urge the U.S. Senate to swiftly confirm Secretary-designee Vilsack’s nomination.”

 

For background:

The NIHC briefed the Acting USDA Secretary on the following issues:

  • Product certification and laboratory certification for hemp;
  • Delayed enforcement and corrections to specified provisions of the AMS rule on hemp;
  • Development of hemp checkoff program;
  • Trade protocols, standards and capacity-building for resin, nutritional and fiber hemp;
  • Increased R&D to identify competitive resin, nutritional and fiber uses;
  • Funding for export supply chain development;
  • Encourage FDA guidance on CBD;
  • Establishment of a Federal Advisory Committee (FACA) to advise Secretary on hemp issues.

 

About the National Industrial Hemp Council: The National Industrial Hemp Council provides high-quality networking and resources for its members, from farm to consumer. Its leadership is composed of leading international, federal, state, private industry, and government professionals throughout the sector. The organization is dedicated to furthering market development, assisting members in entering the industry, and educating consumers on industrial hemp and its applications. For more information, please go to www.hempindustrial.com. 

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Swift Action from the New Administration…

It’s been an exciting week in the Capitol. We’ve seen a time-honored tradition of a new Administration taking the reins of the federal government and with it comes new policy proposals.

We saw those changes take place immediately. On its first day in office, the Biden Administration directed the immediate halt of all Trump Administration policies that were currently under review and open for comment as traditionally occurs when a new administration takes office.

 

NEW ADMINISTRATION EFFECT ON HEMP REGS FROM USDA AND DEA

 

In regard to those policies that have been published in the Federal Register, but have yet to take effect, the Biden Administration is asking agencies to consider postponing the rules’ effective date for 60 days. For rules that have been published but have yet to take effect, the Biden Administration is asking federal agencies to consider opening the rule back up for a 30-day public comment period.

This notice would have no particular effect on the rule the Trump Administration published on January 19, 2021 titled Establishment of a U.S. Domestic Hemp Production Program as it is a final rule with an effective date of March 22, 2021, just beyond the 60 days mentioned above. Nevertheless, the new administration can freeze any rule it wants to, and we actually think there’s a decent probability that the new leadership will want to intervene and make further revisions to this rule before it goes into effect (be that by March 22, 2021 or a later date that they may choose to push back to).

With substantial concern still existing in regard to provisions of this rule, NIHC will be working with the new administration to advocate for any area which warrants adjustments within the legal authority that USDA has or with Congress to provide additional legal authority as needed. Should the agency decide to rescind the rule and re-open the public comment period, rest assured that the NIHC will be reaching out to our membership to solicit feedback.

Likewise, the rule issued a few months ago by the Drug Enforcement Agency (DEA) to implement the 2018 Farm Bill should not be affected by this customary regulatory freeze since it was issued as an interim final rule (IFR) with immediate legal effect.

 

PROSPECTS FOR FDA ACTION OR CONTINUED INACTION

 

Finally, we get asked a lot about our advocacy for an enforcement discretion policy at FDA. Since the FDA never moved forward to finalize their draft policy, we’re still at the same place at the beginning of the Biden Administration that we were at the end of the Trump Administration: we’re waiting for the FDA to act.

We continue to believe that the inaction of the FDA on this critical issue is unacceptable and a failure of the agency to complete its most basic duty to protect public health. However, this inaction is representative of inherent problems with the agency and does not appear to be something that will change due to new political leadership. Unfortunately, the change in administration is likely to do nothing but add further delays – particularly as the agency waits for the Senate to confirm a full time Commissioner to lead the agency’s policy direction.

 

NEW AGENCY HEADS AND CABINET YET TO BE NAMED

 

A new administration always names a host of new agency leads and while the Biden Administration has designated cabinet secretaries, the U.S. Senate has yet to confirm all but one of President Biden’s cabinet. Until that time each agency is led by career civil servants. A list of acting Secretaries currently leading federal agencies can be found here. Kevin Shea, the Associate Administrator at the Animal and Plant Health Inspection Service (APHIS) will be leading the USDA as acting Secretary until the Senate confirms former Obama Administration USDA Secretary Tom Vilsack, who President Biden has renamed to serve in his prior post.

Trump-era FDA Commissioner Stephen Hahn resigned this week and has been replaced by Janet Woodcock who is now leading the FDA in an acting capacity. POLITICO reports that the FDA “is among a second wave of positions that could take months to move through Senate confirmation.” Under consideration for nomination to this post is Woodcock, former Obama Administration FDA official Josh Sharfstein, and current Principal Deputy Commissioner of Food and Drugs, Amy P. Abernethy.

It’s worth noting that in July, Dr. Abernethy participated in an exclusive NIHC led discussion with hemp industry leaders in her capacity as head of FDA’s CBD Working Group to discuss our recommendations for an enforcement discretion policy on CBD.

It’s an exciting time to be in Washington and we’re anxious to continue working on your behalf to solidify the voice of hemp with the new Biden Administration.

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January 22 News to Know

Hemp Building Materials Have Big Role to Play in Environmental Renewal

Robert Ziner, the CEO of the Canadian Industrial Hemp Corporation (CIHC) writes this week in Hemp Today:

“According to the United Nations Environment Programme (UNEP), the conventional building sector contributes up to 30% of total annual greenhouse gas emissions globally. Left unchecked, those emissions will more than double in the next 20 years. Hemp can help.”

You can read the full article here.

Commercial Industrial Hemp Clears Another Hurdle in Kansas

Alice Manatee of The Hutchinson News in Kansas writes about the implementation of the hemp program in the Sunflower State:

“The Kansas Department of Agriculture held an open meeting on Jan. 20 to consider the adoption of a proposed regulation to govern commercial industrial hemp production in Kansas. KDA proposed amendments to the Act, K.A.R. 4-34-1, to better align with the requirements of the 2018 Farm Bill and the Commercial Industrial Hemp Act, which allows commercial hemp production in Kansas.”

You can read the full story here.

Hemp Growers Still Face a Number of Questions in Their Communities

The Albany Herald (GA) covers a study out of the University of Georgia’s College of Agricultural and Environmental Sciences faculty Benjamin Campbell and Julie Campbell in collaboration with Adam Rabinowitz at Auburn University. The survey asked respondents about the growing of hemp and the creation of hemp products in the areas in which they live.

You can read the article in the Albany Herald here. The original study was published in the Journal of Agriculture and Applied Economics which you can read here.

Few Steps Remaining To Open Industrial Hemp Farming In South Dakota

South Dakota’s KCCR-AM interviews Katie Sieverding, Executive Director of the South Dakota Industrial Hemp Association about the new USDA rule and the next steps for South Dakota’s state-based hemp regulations.

You can listen to the interview on KCCR-AM’s webpage here.
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Member Spotlight: Food Safety Net Services

This week, NIHC proudly announced a partnership and welcomed its newest member Food Safety Net Services (FSNS) to its ranks.

FSNS has been a leader in safeguarding our nation’s food supply through its network of accredited laboratories. With a cornerstone focused on safety, FSNS continues to strategically expand national services for food safety, consumer products and nutraceuticals.

We connected with Barry Carpenter, Senior Advisor for Regulatory Affairs & Client Relations for FSNS to ask more about the company and its role in the industry, and, of course, the value they see in NIHC efforts.

Carpenter (left) has held some very prestigious prior roles in his career. He served for over ten years as the CEO of the North American Meat Institute (NAMI) where he worked closely with government regulators, including new food safety regulations and marketing. He also served for nearly 15 years as the Deputy Administrator for the USDA’s Agricultural Marketing Service, where he oversaw commodity checkoff programs. While at USDA, he represented the United States on the United Nation’s Committee on Agriculture from 1990 until 2006.

With all this experience, Carpenter brings sage insight into the potential and future of the hemp industry. Here are his thoughts.

“Checkoff programs provide the resources necessary to develop markets, build consumer confidence, conduct research and provide industry education. These are critical areas of need for the hemp industry.”

What encouraged FSNS to become a patron sponsor of the NIHC?

FSNS recognized that NIHC was optimally positioned to provide leadership for the hemp industry, through their engagement with producers and processors. Further, their Board of Directors has considerable experience and success working with Congress as well as federal and state regulators.

What plans does FSNS have that is making it a leader in safety of this growing industry?

FSNS has 27 years of experience supporting the food and beverage industry. Knowing safety is paramount to gain the confidence of consumers, FSNS will rely on the consistency and credibility of their processes and methodologies to enhance the industry’s image in the marketplace.

What type of standards do you believe need to be had for the CBD industry?

Cannabidiol is very complex! The array of products currently being produced along with new products being developed number in the thousands. The sooner federal and state regulators will establish safety standards, the better. The industry will respond to marketplace demands to establish standards for product quality and consistency. As the market matures, users of CBD will demand certain product attributes, and industry standards will evolve.

How do you see what FSNS does in other areas of food safety translating to making sure consumers have safe CBD?

FSNS has a team of highly skilled scientists and technicians that are continually working to improve methods and processes. Further, they rely on internal controls and outside audits to verify their performance. Processors will build their reputation and brand identity by providing consumers with safe products that consistently meet their expectations. FSNS provides those support services to the food and beverage industry and will do the same for the CBD industry.

As you’re aware, NIHC is also pursuing a checkoff program for hemp. Considering your prior work with the USDA under the Agricultural Marketing Service with oversight of checkoff programs, what challenges do you see for the hemp industry in establishing a checkoff program?

The major challenge faced by all new checkoff programs is getting buy-in from the producers and processors.  Drivers of the checkoff program will need to educate the producers so they are willing to take a leap of faith, and ultimately realize a return on their investment.

How do you believe a hemp checkoff program would help the industry?

Checkoff programs provide the resources necessary to develop markets, build consumer confidence, conduct research and provide industry education. These are critical areas of need for the hemp industry.

Barry, you have been a leader for many years in other industries to build momentum and encourage strict standards, as well as achieved much within your government work. With all that context, what excites you the most about the potential of the hemp industry, both within the U.S. and globally? 

The growth potential for hemp products is enormous. The industry has only scratched the surface of potential products and uses for the many derivatives of hemp. As the industry becomes more organized and focused, the growth will be astronomical. I am especially excited to help NIHC be a significant part of this transition.

What short- or long-term obstacles do you see that the industry should work to overcome?

Short-term, the industry needs to invest in research to provide regulators with the information they need to establish safety standards. Concurrently, sampling and testing methodologies need to be validated and standardized.

Long-term, the industry needs to work towards providing more clarity and consistency on product performance.  Further, to be successful long term, the industry needs to focus on efficiencies and new technologies in the production and processing sectors to enhance sustainability.

 

 
 

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202-919-3750
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