link to page 1 link to page 1 
December 12, 2022
Farm Bill Primer: Selected Hemp Industry Issues
Hemp is a variety or cultivar of Cannabis sativa—the same
CRS In Focus IF11860, Production, Marketing, and
plant as marijuana—grown to produce nonpsychoactive
Regulation of Hemp Products.
food, beverage, consumer, and industrial products. Hemp is
defined in statute as the Cannabis sativa plant and any part
Figure 1. Hemp Acreage by County, 2020
of that plant, including its seeds, cannabinoids, and isomers,
with a delta-9 tetrahydrocannabinol (THC) concentration of
“not more than 0.3 percent on a dry weight basis” (7 U.S.C.
§1639o). The 2018 farm bill (P.L. 115-334; Agriculture
Improvement Act of 2018) legalized hemp by removing
hemp (as defined) from the definition of marijuana in the
Controlled Substances Act (CSA, 21 U.S.C. §§802 et seq.).
The 2018 farm bill further directed the U.S. Department of
Agriculture (USDA) to create a framework to regulate
hemp cultivation under federal law and facilitate
commercial cultivation, processing, marketing, and sale of
hemp and hemp-derived products. USDA published its final
hemp regulations in 2021. Other 2018 farm bill provisions
Source: Graphic is a reprint with permission from the American
made hemp producers eligible for federal crop insurance
Farm Bureau Federation, which excludes data for Hawai and Alaska,
and agricultural research programs. Despite these policy
although USDA reports production in both states.
changes in the 2018 farm bill, Congress may consider
Table 1 shows USDA reported data for 2021 on the farm-
further amendments as it starts to debate the next farm bill.
level value, volume, and harvested acres by the leading
Overview of U.S. Hemp Cultivation
hemp markets (i.e., fiber, grain, seed, flower) based on
growing system (i.e., whether grown in the open field
USDA reports that in 2021—the first year official USDA
outdoors or under protection, such as in a greenhouse or
data has been collected—U.S. hemp growers planted
indoor facility). As shown, production of floral hemp grown
54,200 acres of hemp while harvesting about 33,500 acres,
in the open was the dominant type of hemp grown in 2021,
accounting for a small share of total U.S. harvested
as measured by total value and acreage. By comparison, the
cropland acres (<0.1%). The difference between planted
value and acreage dedicated to hemp fiber, grain, and seed
and harvested hemp acres may reflect the difference
production was lower. Floral hemp tends to command
between legal hemp that falls within legal THC limits and
higher market prices compared with other marketable uses
noncompliant (or “hot”) hemp that may not enter allowable
for hemp.
U.S. marketing channels. USDA estimates about 20% of
hemp grown during the crop year will exceed legal THC
Table 1. Farm-Level Value of U.S. Hemp Production
limits, demonstrating the inherent risks to farmers of
by Production Type and by Market Segment (2021)
growing hemp within USDA’s regulatory framework.
Market
Prod.
Production
Value
(million
Avg.
Currently hemp is grown in all U.S. states under a USDA-
Type
$million
pounds) Acres
Yield
approved state plan or a USDA general license. The leading
Floral (open)
623.0
19.7 16,000 1,235
hemp producing states with more than 1,000 harvested
acres (2021) were Montana (4,500 acres), Colorado (3,100),
Grain (open)
6.0
4.4 8,255
530
Minnesota (2,300), California (2,250), Utah (2,150), North
Fiber (open)
41.4
33.2 12,700 2,620
Carolina/Oregon (1,850 each), South Dakota (1,700),
Seed (open)
41.5
1.9
3,515
530
Kentucky (1,500), Missouri (1,150), Vermont (1,080), and
Texas (1,070) (Figure 1). Production by state tends to be
All Types
112.0
NA
NA
NA
highly variable year-to-year. The 2021 farm-level value of
(protection)
hemp produced was $824 million across an estimated
Source: USDA, National Hemp Report, 2022. Reported acres are not
additive given multi-crop production in some cases.
13,000 grower licenses. This total spans the leading hemp
markets based on the part of the plant used: fiber, grain,
Addressing Hemp in the Next Farm Bill
seed, and flower. Some suggest there may be a separate
Industry interests related to hemp cover many national and
market category for the plant’s extracted compounds that
regional groups with different policy goals and priorities.
may be derived either from the plant’s flowers and trim or
These priorities often are tied to the primary products they
from its total biomass (including sticks and stems). For
produce and/or represent or may be based on the part of the
more background on the leading markets for hemp, see
hemp plant used (e.g., whether hemp is grown for fiber for
industrial uses or for use in seed-derived food ingredients
https://crsreports.congress.gov
Farm Bill Primer: Selected Hemp Industry Issues
[hulled seed, seed protein powder, and seed oil]) that the
countries require the use of certified hemp seed. USDA
Food and Drug Administration (FDA) has acknowledged as
claims that developing certified seed requirements would
generally recognized as safe (GRAS) or whether hemp is
necessitate additional rulemaking. The agency’s rationale
grown for flower for use as a dietary supplement or
for not adopting a certified seed requirement is documented
wellness product.
in USDA’s final rule (86 Federal Register 5625-5626).
Most national farm and herbal/dietary supplement groups,
Finally, some suggest separate requirements should apply to
as well as some state and professional organizations, have
different end-products. For example, H.R. 6645 would
developed policy positions related to hemp. In addition,
either exempt or relax regulatory requirements for hemp
over the years, numerous hemp-specific interest groups
fiber and grains as compared to adult-use cannabinoid
have emerged. Some national hemp producer groups
products. In general, most countries with legalized hemp
(ranked by year founded) are Hemp Industries Association
and other cannabis varieties, including the United States,
(1994); Vote Hemp (2000); National Hemp Association
regulate hemp fiber and grain separately from hemp
(2014); U.S. Hemp Roundtable (2017); National Industrial
cannabinoids, including low-THC cannabis extracts.
Hemp Council (2019); U.S. Hemp Growers Association
(2019); and the American Trade Association for Cannabis
Addressing Concerns About Product Safety
and Hemp (2019). These interest groups often have
The 2018 farm bill addressed hemp cultivation only and did
differing priorities, which may complicate U.S. hemp
not directly address some consumer products containing
policymaking. Moreover, the interests of these groups often
hemp or hemp ingredients subject to FDA regulation. The
span the use of hemp as an industrial input, as a food
2018 farm bill explicitly preserved FDA’s authority related
ingredient, and as a dietary supplement ingredient.
to hemp products (§10113), and it remains unclear whether
changes to FDA laws and regulations fall within the
Calls to Modify USDA’s Hemp Regulation
jurisdiction of the agriculture committees. FDA has
A possible shared policy priority among these interest
continued to evaluate the safety of hemp-derived
groups is to relax some of USDA’s regulatory
cannabinoid products, including cannabidiol (CBD), and
requirements, which some grower groups and state
FDA has not yet approved these products as safe for public
regulators contend are overly restrictive and impractical.
use. As such, some hemp consumer products remain
For example, some stakeholders want to reduce the
unapproved and unregulated. Certain legislative proposals
oversight role of the Drug Enforcement Administration
would remove FDA restrictions on the marketing of food
(DEA) in regulating hemp, including removing the
and dietary supplements containing added hemp-derived
requirement that hemp be tested at DEA-registered labs or
cannabinoids (e.g., H.R. 841; S. 1698); other proposals seek
that eligible testing labs be DEA-accredited. Some groups
to establish federal quality and safety standards as well as
want to repeal the existing exclusion preventing most
labeling requirements for products containing hemp-derived
persons with a felony controlled substance-related
cannabinoids (H.R. 6134). Separately, promulgating
conviction from obtaining a hemp license. Congress
pesticide residue limits for hemp foods and products would
specifically included DEA’s consultative role in USDA’s
facilitate product marketing. Some propose excluding
regulation and the felon exclusion in the 2018 farm bill.
synthetic derivatives that may not be naturally occurring in
H.R. 6645 seeks to remove these requirements.
the plant from the statutory definition of hemp (e.g., H.R.
6645). Still others seek to ban certain hemp derivatives and
Others want to amend the statutory definition of hemp to
cannabinoids, as some consumer products have been shown
raise the allowable legal THC level from 0.3% to 1% (e.g.,
to pose a risk to public safety and because of ongoing
S. 1005; H.R. 6645) to provide flexibility to growers and
concerns about FDA oversight of these products.
avoid crop destruction if hemp fields exceed the legal THC
threshold. Many are calling for establishing laboratory
Calls to Enhance USDA Support for Hemp
standards. Some groups oppose USDA’s regulatory
Most hemp advocates seek to expand USDA farm program
requirement that testing for THC content of a hemp sample
support for hemp and hemp products. This includes efforts
be based on Total THC, which includes the potential
to expand research related to genetics and management
conversion of tetrahydrocannabinolic acid into THC, rather
practices and targeted support to develop processing
than the delta-9 THC concentration specified in hemp’s
capacity of hemp fibers for use in insulation, construction
statutory definition. USDA reconsidered alternative testing
materials, and plastics. Some call for expanding support for
methods but retained Total THC as the testing because not
hemp climate-smart and sustainability practices, promoting
all testing methods include decarboxylation, among other
hemp’s soil carbon sequestration and phytoremediation
reasons (see 86 Federal Register 5619-5621).
properties. Others seek to add hemp to the statutory
Decarboxylation refers to the process that activates the
definition of a specialty crop (7 U.S.C. §1621 note), which
psychoactive compounds in the cannabis plant. Changes to
most fruit and vegetable groups oppose. Designating hemp
USDA’s testing methods could require USDA to conduct
as a specialty crop could qualify hemp for USDA programs
rulemaking and comment procedures, which could further
that tie eligibility to the specialty crop definition.
delay development of the U.S. hemp industry.
Expanding federal crop insurance and improved risk
management tools are a priority for some, given the risks
Another regulatory aspect USDA reconsidered but retained
involved in growing hemp (see CRS In Focus IF11919,
was its decision that its hemp regulation would not require
Federal Crop Insurance for Hemp Crops), along with
the use of government-certified or approved seed for
improving access to credit and banking services (as
planting or processing. Hemp regulations in certain other
addressed by H.R. 1996 and S. 910).
https://crsreports.congress.gov
Farm Bill Primer: Selected Hemp Industry Issues
IF12278
Renée Johnson, Specialist in Agricultural Policy
Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff to
congressional committees and Members of Congress. It operates solely at the behest of and under the direction of Congress.
Information in a CRS Report should not be relied upon for purposes other than public understanding of information that has
been provided by CRS to Members of Congress in connection with CRS’s institutional role. CRS Reports, as a work of the
United States Government, are not subject to copyright protection in the United States. Any CRS Report may be
reproduced and distributed in its entirety without permission from CRS. However, as a CRS Report may include
copyrighted images or material from a third party, you may need to obtain the permission of the copyright holder if you
wish to copy or otherwise use copyrighted material.
https://crsreports.congress.gov | IF12278 · VERSION 1 · NEW