What the 2018 Farm Bill's legalization of industrial hemp could mean for Arkansas farmers and the hemp industry | Arkansas Blog

Friday, December 21, 2018

What the 2018 Farm Bill's legalization of industrial hemp could mean for Arkansas farmers and the hemp industry

Posted By on Fri, Dec 21, 2018 at 4:09 PM

click to enlarge hemp_plant.jpg

The 2018 Farm Bill, signed Thursday by President Trump, removes hemp and its derivatives from the Controlled Substances Act, thus legalizing the cultivation of industrial hemp and the hemp derivative CBD oil. The move stands to greatly change the hemp farming and product business.

The bill, which will be in effect from 2019-23, moves supervision of hemp cultivation to the Department of Agriculture. The state legislature passed in 2017 a bill allowing research cultivation of hemp; the State Plant board is accepting applications for growing and processing hemp. 

The change is a leap forward from the 2014 Farm Bill, which allowed limited industrial hemp cultivation for research purposes under an agricultural pilot program.

Jason Martin, CEO of Tree of Life Seeds, a Little Rock-based company that makes a variety of CBD oil products, said legalization will have a huge impact on his business.

"First and foremost, it declassifies anything that comes from CBD and other phytocannabinoids that come out of the industrial hemp plant," he said. "That’s huge, because that’s going to allow us to be sold without question in Walmart [and] Walgreens. All the big box stores will be able to carry CBD products and sell them."

Martin said the federal law change will allow him to market Tree of Life products through platforms like Facebook, Google, and Amazon, where he's currently not allowed to advertise because CBD is considered a drug. It will also open the hemp industry to major investments.

"The fact that now, all of a sudden, it’s 100 percent legal across the board, that opens up Wall Street money, that opens up anybody who wants to invest in this sector and in this industry," he said. "It’s wide open and legal for anybody and everybody."

Martin also said the Farm Bill will expand the types of CBD and hemp products customers will be able to buy. "You can expect to see this in every category in the grocery store," he said. "Kellogg’s is going to have a CBD cereal, Dannon Yogurt is going to have a CBD yogurt. ... CBD is going to be available in products everywhere."

This boom in CBD and hemp products can be attributed to the multitude of ways hemp and CBD can be consumed or used, as well as the amount of time it takes for the crop to grow, Martin said.

"With marijuana, you’re consuming it one way or another, you choose how you consume it, but with hemp, there are so many different ways [to consume it]," he said. "Out of fiber, they’re making plastic bottles right now for water that are completely made out of hemp, and they’re biodegradable. There are all the different oils and petroleum products ... and, of course, you can make every paper product that’s currently made [with hemp]. One acre of hemp from a fiber crop is equal to four acres of trees, yet hemp is grown annually and trees are grown in 15 to 20 years."

Asked if he thinks the legalization of hemp will help grease the wheels for the national legalization of recreational marijuana, Martin said he thinks it's a step in that direction, and that it will also help educate people about the differences between marijuana and hemp.

The law's effect on the market should begin to be felt by April, Martin said. "Over the next three to six months, you’re going to still see some big change," he said. "And then in 2020, that’s when it will really hit. That’s when farms will really be ready, and all your major food manufacturers will then be putting it into all their products."

Martin, an Arkansas native, said the farm bill's impact on hemp growing in Arkansas will depend on how quickly the State Plant Board level adopts new regulations.

"There’s going to be plenty of farmers who will grow in 2019 under the industrial hemp bill that we already have," Martin said. "Now, does the State Plant Board open up because of this today and go, you know what, there will be no limits on how big of a farm you can grow, and you don’t have to submit a research plan to grow and do all of those things? I don’t know. Those are the questions that need to be asked, and in reality, I don’t think they’re going to have an answer right now, today. ... They don’t have it in their budget ... to actually manage a program that large [at this time.]"

Martin said his business partner, Tree of Life Seeds COO Brian Madar, is a third-generation Arkansas farmer and still farms thousands of acres in the state. It's this connection to Arkansas, and the state's rural and agricultural status, that Martin said makes him confident about its place in the future of the hemp industry.

Martin said farmers in Arkansas, one of only 13 states to have a research program, have a head start on the business. "A lot of hemp really is going to require new tools and new equipment that have yet to be developed, and we’re going to see a lot of that happen in Arkansas. ... We’ve been hands on the ground, boots on the ground if you want to call it that, in states all over the country, and these guys just aren’t as flexible and as [ingenious] as Arkansas farmers are."

Martin is somewhat concerned that large corporations may take out patents on products or lobby to impose expensive regulation and license fees on farmers wishing to grow hemp. But, he said, it will take several years for the supply of hemp and CBD products to catch up with the demand, and in the meantime, there will be innovations to look forward to.

"People who have been working on things in their basement, in their attic, in their garage, for years and years — kind of like the Apple computer or Microsoft — there’s going to be a lot of new things that are spawned out of this," he said. "Especially because people like ourselves are now going to have a lot of additional capital to do those things."

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