Welch talks hemp regulations at roundtable

Just as he stood up for Vermont’s artisan cheesemakers and craft brewers, U.S. Representative Peter Welch said last week he’d do the same for Vermont’s hemp growers and processors in a roundtable meeting last week in Burlington.   

The meeting of about a dozen people brought representatives together from all sectors of Vermont’s hemp supply chain, including start cultivators, growers, processors, and wholesale buyers.

“It’s legal, but that doesn’t mean there aren’t obstacles that you face, and I’d like to find out what those are and how we can help,” Welch said at the start of the meeting.

Under the 2018 farm bill, hemp is now a legal agricultural product like corn or soy, provided it is grown in a state operating a hemp program approved by the U.S. Department of Agriculture. Hemp products will be regulated by the Food and Drug Administration (FDA), but how it will approach regulating a market that in 2017 recorded sales of $820 million for industrial hemp and $190 million for hemp-derived CBD in the United States according to the Hemp Business Journal, remains to be seen.

“Even though we in this room unanimously believe that hemp is an individual market and is separate from recreational cannabis and needs to be regulated as such. It’s our burden to bear that we have to educate lawmakers along the way in what it is that differentiates it and what the challenges that we face while reinforcing that it is not the same thing as marijuana.” – Carl Christianson, Northeast Processing

There are over 100 known cannabinoids that can be derived from hemp. In recent years, worldwide health food, beauty, and other markets have become enamored with the effects of cannabidiol (CBD). Due to the political nature surrounding another widely known chemical compound (THC), rules around cultivating, processing, extracting, and even transporting some of these extracts are quagmired in legal dilemmas ranging from varying state statutes to concentration levels that occur in the extraction process.

The 2018 farm bill expanded the definition of hemp to include all parts of the plant and chemical compounds, but the law needs to be codified in rules set by the USDA, which is resuming work after a 21-day government shutdown. Until the USDA writes its rules – a process that could take a year or more – enforcement is running on rules from 2014, which do not have that same wide definition.    

Dan Chang of Kria Botanicals said clear standards how hemp is grown and processed are needed to allow the market to reach its fullest potential. “We’re in a unique position where we’re coming to policy makers and saying that we are businesses that are requesting regulation in this space,” he said.    

Carl Christianson, CEO of Northeast Processing, made the drive from Brattleboro to attend the meeting and bring up what he called “the elephant in the room.”

When hemp is processed and CBD is extracted from hemp, THC is extracted as well and becomes concentrated in levels that can be illegal.

“These conversations are challenging because this is cannabis,” he said. “Even though we in this room unanimously believe that hemp is an individual market and is separate from recreational cannabis and needs to be regulated as such. It’s our burden to bear that we have to educate lawmakers along the way in what it is that differentiates it and what the challenges that we face while reinforcing that it is not the same thing as marijuana.”

But hemp does get tangled up in the debate around how THC should be regulated. When hemp is processed and CBD is extracted from hemp, THC is extracted as well and becomes concentrated in levels that can be illegal. Vermont hemp producers can opt to have their hemp processed in states where the THC is salable to dispensaries or value-adding producers, earning them more money for their crop. Participants said until a clear pipeline for extracted THC is created, it remains one of many gray areas for Vermont hemp.

“Right now it’s a waste product and I don’t want to think about it because I don’t know where it stands,” said Kria’s Dan Chang. “It’s a valuable commodity and it’s kind of a snag at the same time.”

Some states are pursuing and passing legislation that would classify CBD as a food and not a drug to allow for greater flexibility, while other states are taking steps back.

That the lack of clarity on these rules has literally landed some people in jail. In Oklahoma, four people are facing felony charges after Oklahoma police seized 18,000 pounds of hemp bound from Kentucky to Colorado. A similar incident occurred last week in Idaho.

Receiving approval of CBD-containing products from the FDA is another area of concern. In the wake of the farm bill’s passage, FDA Commissioner Scott Gottlieb issued a detailed statement that warned the FDA would enforce the regulation of unapproved CBD products. CBD is an active ingredient in the FDA-approved drug Epidiolex and is considered an adulterate in other consumer products.

Even though the World Health Organization has recommended removing CBD and CBD preparations with less than .2 percent THC from international drug conventions, in the United States, CBD would have to be tested as a dietary supplement and any drugs would have to be vetted in the same manner as Epidiolex.  

“We can make a concentrated oil and remove the THC or bring it down to a compliant level and we can wholesale that oil internationally now as a commodity,” said Carl Christianson. “But if we want to market it to consumers as something they digest, the FDA can come after us.”

Some states are pursuing and passing legislation that would classify CBD as a food and not a drug to allow for greater flexibility, while other states are taking steps back. Last week, the Portland Press Herald reported that the Maine Department of Health and Human Services (DHHS) was instructing Maine businesses that only medical marijuana dispensaries could sell foods, tinctures, and capsules containing CBD and only to registered patients.  

States’ Medical marijuana and hemp programs are protected from Department of Justice intervention by the Rohrabacher-Farr Amendment, a 2001 piece of legislation that prohibited the DOJ from spending money to intervene in state medical cannabis laws. While the DOJ can’t rely on the Drug Enforcement Agency to take action, the Food and Drug Administration can turn to the Bureau of Alcohol Tobacco and Firearms and Explosives (BATF) for that same purpose.    

Even though the World Health Organization has recommended removing CBD and CBD preparations with less than .2 percent THC from international drug conventions, in the United States, CBD would have to be tested as a dietary supplement and any drugs would have to be vetted in the same manner as Epidiolex.  

Hemp activist and founder of Vermont Hemp Co. Joel Bedard said this could be an opportunity for federal legislation. “A rider that prohibited the BATF from utilizing resources to intervene on behalf of the FDA on hemp programs would be very beneficial from the top down,” he said.

Welch has made it a habit of going to bat for Vermont’s small businesses. In 2014, the Food and Drug Administration worried Vermont’s artisan cheese growers when they rolled out a regulation that would have banned the use of wooden shelving in cheese caves.

Around the same time, brewers were notified that they would be barred from giving spent grain from brewing to farmers for animal feed. They were instead instructed to bag the grain and send it to a landfill. In both of those cases, Welch wrote to the FDA and asked them to reexamine the rules, while finding co-signers who had brewers and cheesemakers in their districts. And in both of those cases, The FDA reconsidered its original decision.

Just as cheesemakers and brewers have taken advantage of broader markets, Anson Tebbets,  Secretary of the Agency of Agriculture, Food and Markets said the goal was to do the same for Vermont hemp. “We want another crop to offer to our farmers,” he said. “And we think hemp can do that.”