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Updated November 29, 2023
Farm Bill Primer: Selected Hemp Industry Issues
Hemp is a variety or cultivar of Cannabis sativa—the same
and Kentucky (1,300). Production by state tends to be
plant as marijuana—grown to produce nonpsychoactive
highly variable year-to-year.
food, beverage, consumer, and industrial products. The
2018 farm bill (Agriculture Improvement Act of 2018; P.L.
Terms and Definitions
115-334) legalized hemp by removing hemp (as defined,
see text box) from the definition of marijuana in the
Hemp—Defined as “the plant Cannabis sativa L. and any part of
Controlled Substances Act (CSA, 21 U.S.C. §§802 et seq.).
that plant, including the seeds thereof and all derivatives,
The 2018 farm bill further directed the U.S. Department of
extracts, cannabinoids, isomers, acids, salts, and salts of
Agriculture (USDA) to create a framework to regulate
isomers, whether growing or not, with a delta-9
hemp cultivation under federal law and facilitate
tetrahydrocannabinol [THC] concentration of not more than
commercial cultivation, processing, marketing, and sale of
0.3 percent on a dry weight basis” (7 U.S.C. §1639o).
hemp and hemp-derived products. USDA published its final
Cannabinoids—No specific definition of cannabinoids exists in
hemp regulations in 2021. Other 2018 farm bill provisions
the U.S. Code. Cannabinoids refer to the unique chemical
made hemp producers eligible for federal crop insurance
compounds produced in the Cannabis sativa plant, which are
and agricultural research programs. Congress may consider
known to exhibit a range of psychological and physiological
further amendments as it debates the next farm bill.
effects. There are more than 100 cannabinoids in the cannabis
plant. Tetrahydrocannabinol (THC) and cannabidiol (CBD) are
Overview of U.S. Hemp Cultivation
the two most well-researched and abundant cannabinoids.
USDA reports that the farm-level value of total utilized
See CRS Report R44742, Defining Hemp: A Fact Sheet.
hemp production was $238.4 million in 2022, down from
$824 million in 2021 (Table 1). This total spans all
production types (i.e., grown in the open field or under
Table 1. U.S. Hemp Production by Market, 2021-2022
protection, such as in a greenhouse) and all market
Production Type and
2021
2022
Change
segments (i.e., hemp flower, grain, seed, and fiber). Floral
Market Segment
($mil ion)
(percentage)
hemp grown in the open was the dominant type of hemp
grown in 2022, as measured by total value and acreage. By
Hemp Production in Outdoor Open Field
comparison, the value and acreage dedicated to hemp fiber,
Floral hemp
623.2
179.0
-71%
grain, and seed production was lower. Floral hemp tends to
Hemp grains
6.0
3.6
-40%
command higher market prices compared with other
marketable uses for hemp. (See CRS In Focus IF11860,
Hemp fiber
41.4
28.3
-32%
Production, Marketing, and Regulation of Hemp Products.)
Hemp seed
41.5
1.5
-96%
Subtotal
712.2
212.4
-70%
In 2022, U.S. hemp growers planted 28,300 acres of hemp
and harvested about 18,300 acres, accounting for a small
Hemp Production Under Protection
share of total U.S. harvested cropland acres (<0.1%). The
Floral hemp
64.4
24.7
-62%
difference between planted and harvested hemp acres may
Hemp seed
23.7
0.6
-98%
reflect the difference between legal hemp that falls within
legal THC limits and noncompliant (or “hot”) hemp that
Clones/Transplants
23.8
0.7
-97%
may not enter allowable U.S. marketing channels. USDA
Subtotal
111.9
26.1
-77%
estimates about 20% of hemp grown during the crop year
Total Farm-Level Value
824.1
238.4
-71%
will exceed legal THC limits, demonstrating the inherent
risks to farmers of growing hemp within USDA’s
Planted Acres (all uses)
54,152
28,314
-48%
regulatory framework. Harvested acres of hemp grown in
Source: CRS from USDA’s 2021 and 2022 National Hemp Report.
the open in 2022 included 6,850 acres for fiber, 5,379 acres
May not add due to rounding. Reported acres across different market
for grain, 812 acres for seed, and 7,105 acres of floral
segments are not additive given multi-crop production in some cases.
hemp. (Reported acres across different market segments are
not additive given multi-crop production in some cases.)
Addressing Hemp in the Next Farm Bill
Hemp industry interests cover many national and regional
Hemp is grown in all U.S. states under a USDA-approved
groups with different policy goals and priorities. These
state plan or a USDA general license. The leading hemp
priorities often are tied to the primary products they
producing states, with more than 1,000 harvested acres
produce and/or represent or may be based on the part of the
grown in the open (2022), were South Dakota (2,550),
hemp plant used (e.g., whether hemp is grown for fiber for
Oregon (1,900), Montana (1,470 acres), Missouri (1,400),
industrial uses or for use in seed-derived food ingredients or
as a dietary supplement or wellness product). To date, the
https://crsreports.congress.gov
Farm Bill Primer: Selected Hemp Industry Issues
Food and Drug Administration (FDA) has acknowledged
cannabis plant. Changes to USDA’s testing methods could
three hemp product categories—hulled hemp seed, hemp
require USDA to conduct rulemaking and comment
seed protein, and hemp seed oil—as generally recognized
procedures, which could further delay development of the
as safe (GRAS) for use in human food.
U.S. hemp industry. Another regulatory aspect USDA
reconsidered but retained was its decision that its hemp
Most national farm and herbal/dietary supplement groups,
regulation would not require use of government-certified or
as well as some state and professional organizations, have
approved seed for planting or processing. Hemp regulations
developed policy positions related to hemp. In addition,
in certain other countries require use of certified hemp seed.
over the years, numerous hemp-specific interest groups
USDA claims that developing certified seed requirements
have emerged. Some national hemp producer groups (listed
would necessitate additional rulemaking. USDA’s rationale
by year founded) are Hemp Industries Association (1994);
for not adopting a certified seed requirement is documented
Vote Hemp (2000); National Hemp Association (2014);
in its 2021 final rule (86 Federal Register 5625-5626).
U.S. Hemp Roundtable (2017); National Industrial Hemp
Council (2019); U.S. Hemp Growers Association (2019);
Addressing Product Safety Concerns
and the American Trade Association for Cannabis and
The 2018 farm bill addressed hemp cultivation only and did
Hemp (2019). These interest groups often have differing
not directly address some consumer products containing
priorities, which may complicate U.S. hemp policymaking.
hemp or hemp ingredients subject to FDA regulation.
Moreover, the interests of these groups often span the use
Congress explicitly preserved FDA’s authority related to
of hemp as an industrial input, as a food ingredient, and as a
hemp products (§10113), and it remains unclear whether
dietary supplement ingredient.
changes to FDA laws and regulations fall within the
jurisdiction of the agriculture committees. Since 2018,
Modifying USDA’s Hemp Regulation
certain hemp consumer products have remained unapproved
A possible shared policy priority among these interest
and unregulated while FDA reviews the safety of hemp-
groups is to relax some of USDA’s regulatory
derived cannabinoids, including cannabidiol (CBD). During
requirements, which some grower groups and state
this time, Congress has introduced legislative proposals that
regulators contend are overly restrictive and impractical.
would remove FDA restrictions on the marketing of food
For example, some stakeholders want to reduce the
and dietary supplements containing added hemp-derived
oversight role of the Drug Enforcement Administration
cannabinoids; some proposals would establish federal
(DEA) in regulating hemp, including removing the
quality and safety standards and labeling requirements for
requirement that hemp be tested at DEA-registered labs or
such products (e.g., H.R. 4849/S. 2451, H.R. 1628, H.R.
that eligible testing labs be DEA-accredited. Some groups
1629). Still others seek to ban certain hemp derivatives and
want to repeal the existing exclusion preventing most
cannabinoids, as some consumer products have been shown
persons with a felony controlled-substance-related
to pose a risk to public safety and because of ongoing
conviction from obtaining a hemp license. Congress
concerns about FDA oversight of these products. In January
specifically included DEA’s consultative role in USDA’s
2023, FDA issued a statement that it would “work with
regulation and the felon exclusion in the 2018 farm bill.
Congress” to develop “a new regulatory pathway” for CBD.
H.R. 1428 would remove these requirements.
This action followed years of FDA review related to CBD
product regulation. In July 2023, several Members issued a
Some support establishing separate requirements for
request for information soliciting stakeholders on how to
different end products. H.R. 3755/S. 980 would exempt
“provide a legal pathway” for marketing CBD products.
farmers that grow hemp fiber and grains from background
See CRS In Focus IF10391, Hemp-Derived Cannabidiol
checks and sampling and testing protocols that are required
(CBD) and Related Hemp Extracts.
for farmers growing hemp for use in cannabinoid products.
In general, most countries with legalized hemp and other
Enhancing USDA Support for Hemp
cannabis varieties, including the United States, regulate
Most hemp advocates seek to expand USDA farm program
hemp fiber and grain separately from hemp cannabinoids,
support for hemp and hemp products. This includes efforts
including low-THC cannabis extracts. Previously
to expand research related to genetics and management
introduced legislation further sought to amend the statutory
practices and targeted support to develop processing
definition of hemp to raise the allowable legal THC level
capacity of hemp fibers for use in insulation, construction
from 0.3% to 1% (e.g., S. 1005; H.R. 6645 [117th
materials, and plastics. Some call for expanding support for
Congress]) to provide additional flexibility to growers and
hemp climate-smart and sustainability practices, promoting
avoid crop destruction if hemp fields exceed the legal limit.
hemp’s soil carbon sequestration and phytoremediation
properties. Others seek to add hemp to the statutory
Some continue to oppose USDA’s regulatory requirement
definition of a specialty crop (7 U.S.C. §1621 note), which
that testing for THC content of a hemp sample be based on
most fruit and vegetable groups oppose. Designating hemp
Total THC, which includes the potential conversion of
as a specialty crop could qualify hemp for USDA programs
tetrahydrocannabinolic acid into THC rather than the delta-
that tie eligibility to the specialty crop definition. Some
9 THC concentration specified in hemp’s statutory
prioritize expanding federal crop insurance and improved
definition. USDA reconsidered alternative testing methods
risk management tools, given the risks involved in growing
but retained Total THC because not all testing methods
hemp (see CRS In Focus IF11919, Federal Crop Insurance
include decarboxylation, among other reasons (see 86
for Hemp Crops), along with improving access to credit and
Federal Register 5619-5621). Decarboxylation refers to the
banking services (see H.R. 2891 and S. 2860).
process that activates the psychoactive compounds in the
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Farm Bill Primer: Selected Hemp Industry Issues
IF12278
Renée Johnson, Specialist in Agricultural Policy
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https://crsreports.congress.gov | IF12278 · VERSION 4 · UPDATED