In 2018, the Farm Bill was passed through United States legislation. While this bill doesn’t sound immediately interesting to many people, if you read a little deeper into the text you’ll see that it actually casts hemp in a favorable light, and that’s excellent news for the CBD industry.
America’s Complicated History with Hemp
While cannabis is used almost exclusively to talk about marijuana, the truth is that the term cannabis actually refers to a family of plants. This includes the hemp plant, Cannabis Sativa.
However, the federal government didn’t seem to know the difference, and in 1970 all cannabis plants were made illegal under the Controlled Substances Act. Marijuana is still listed as a schedule 1 drug under the act, putting it above cocaine, and a slew of dangerous opioids like fentanyl.
While marijuana can definitely impair your judgment, the hemp plant is harmless. That’s because despite being related to marijuana, hemp-based products contain little to no THC and they won’t get you high at all.
However, it can still be extracted in the same way that marijuana can, and it still contains CBD. That’s the part of the cannabis plant that gives the other effects people find desirable, and that gives those seeking alternative treatments a reasonable compromise with overreaching government regulations.
Four Months Later: How the Farm Bill has Impacted the US Market
Pharmacies like CVS and Walgreens have announced their intent to carry CBD oil in states where it’s legal to do so. For CVS, this meat a sharp uptick in the value of their stock upon the announcement, but it seems that the price has fallen backwards a bit.
While CVS has been in a downward trend recently, their desire to jump into the CBD business could signal a turn around for them. If the launch goes well they’ll be likely to expand this product offering into other markets.
Canopy has announced that they will be investing $500 million into hemp production in the state of New York. They’ve also partnered with Martha Stewart to create a line of CBD products interestingly enough.
Surprisingly, Kentucky also looks to be in for a huge boon thanks to hemp production. They were the first state to submit their state hemp plan to the USDA, and they managed to collect $58 million in sales for 2018.
The bluegrass state has also approved over 50,000 acres of land for hemp production for this year and over six million feet of greenhouse space. Plus, their applications for growers exceeded 1,000 in 2018. All of which is likely to provide an amazing boost to Kentucky’s economy, including creating many new jobs for its citizens.
What About the Negative Impacts?
While the legalization of hemp is overwhelmingly positive, there are some negatives for the bill as well. For starters, hemp is not totally in the free and clear here. There are still some pretty strict laws surrounding it, particularly in the way of its allowed THC content.
However, every individual state will also need to propose their own laws surrounding hemp production. This will likely take a good deal of time to complete, and it complicates things for consumers. The reality is that it could actually be years before hemp finds a comfortable place in American culture again.
South Dakota lawmakers are still fighting over their hemp bill. The United States Postal Service has also proven to be an opponent to the industry. They seized a number of CBD shipments, and while the courts ruled in favor of those companies, USPS is still being difficult about it.
Other incidents have included the arrest of a truck driver in Idaho who was transmitting legal hemp from Colorado. While hemp is perfectly fine in Colorado, Idaho still does not differentiate between hemp and marijuana, landing the truck driver in hot water with a possible drug trafficking charge.
The disconnect here is confusing, and until the dust settles, many consumers may be wary of purchasing CBD oils or at least traveling with them. While the Farm Bill has done a lot to positively impact the sale of hemp products in the United States, we still have a long way to go.
Investors may have to ride out the bumps on this trip if they want to invest here. Though you’ll be very likely to profit in the long term if you’re prepared to weather this storm. Eventually, the seas always calm, and investors who put their money into stocks focused on this growing sector could be riding them in much nicer ships in a few years.