What does marijuana legalization mean for the hemp industry?
Marijuana has been a hot topic for the last few decades. Historically speaking, marijuana, and all forms of cannabis, have been utilized for thousands of years. Whether the uses be medicinal, recreational or industrial, hemp and marijuana plants were praised because of their abilities – both psychoactive and homeopathic alike.
When it comes to legislating “cannabis,” things tend to get a bit tricky. This is why many legislative documents within the past few decades have strictly separated hemp and marijuana plants. In short, this is simply because marijuana leads the consumer to immediate and inebriating effects. While hemp, on the other hand, has played a similar role as the docile plant – with little-to-no psychoactive properties available. So, if legislation keeps them separated the majority of the time, what do they really have to do with each other?
Hemp and Marijuana Legality
For years and years, the federal government didn’t separate hemp and marijauana. While it is scientifically correct to refer to each of them as a “cannabis plant” it really stuck hemp in a situation that it was not deserving of. In 1937 under the Marihuana Tax Act, hemp and marijuana plants, recognized as “cannabis” as an illegal substance. After years of legislative arguments over the topic, the decision was solidified and formally made illegal in 1970, under the Controlled Substances Act. This strictly banned cannabis of any kind, silencing a hopeful industry at the time.
Legalization of Hemp
At first, the 2014 Farm Bill, or the Agricultural Act of 2014, gave passage to the cannabis industry to thrive. Then came the 2018 Farm Bill to help filled in many of the gaps left in the initial initiative. Yes, while hemp and marijuana are expremley different plants chemically speaking, many of the same processes exist when you’re processing hemp as you are when doing so with marijuana. To professionals in the cannabis industry, the Farm Bill allowed farmers to refine practices and helped business professionals hone in on their skills. For example, if a farmer legally grows a field of healthy hemp and makes a hemp balm to sell to customers, that same famer now knows how to recreate the process for marijuana since the processes are so similar. In truth, the Farm Bill gave the industry the green light to start preparing for highly anticipated customer volumes.
Moreover, the Farm Bill of 2018 specifically included allowances for commercial purposes – such as shipping the products over state lines to customers! It did not, however, put any restrictions on the sale, transport, or possession of hemp-based products as long as those products are produced in compliance with the FDA regulations and standards set forward.
Sounds perfect, right? Wrong. While there were some freedoms implied by the bill, it did not create a totally “free and open” system in which anyone can do anything they want, wherever they want to do it. There were numerous restrictions laid out that added some obstacles. The most famous obstacle, <0.3% THC, led some hemp farmers to refine their practices. While the hemp plant does not produce an ample amount of THC, it can produce over 0.3% – depending on the strain and methods of farming. With this in mind, many farmers had to rethink their practices.
President Biden and Marijuana
Political affiliations aside, it should come as no shock that with the end of a conservative presidency and the beginning of a progressive presidency, marijuana reform/legalization is back on the table. American history shows that decriminalization of drugs and other substances are usually supported by the left and opposed by the right. While Biden begins his term, his constituents won’t shake his promise to bring real reform and aid to the cannabis industry.
For starters, states started passing legislation instead of waiting for the federal government to decide what to do with marijuana. Many states, like Colorado, decriminalized marijuana and shortly after made it available for medical use. Soon after, you could find a dispensary around any corner in downtown Denver. While state laws can help the industry find it’s standing without the assistance of the federal government, federal laws and restrictions still need to apply. This is where some confusion is born – somewhere between the state power and government power over the topic.
Biden and his administration, however, ran on a message of equality. One of their major goals was to focus on releasing non-violent drug offenders around the country to start healing from the destructive legislation against marijuana. However, this is just a step in the right direction. While the path to legalization is being set, it is unclear how long a project like this really takes.
Forbes mentions in their article here that the current administration’s plans “have some cannabis professionals feeling hopeful but cautious.” One of the more popular cannabis reform attempts, the MORE Act, is a piece of legislation that has been stunted since the Obama administration. Now, with a Biden-led administration reactivating this bill, the hopes for the industry are at an all time high.
So, what does the future hold for marijuana and hemp?
This is absolute speculation. The industry simply runs off of simple statistics that track customer buying habits after the purchase of marijuana and marinjuana-related products. Truth be told, nobody knows. However, our CEO, John Ramsay, has some predictions about what would happen to hemp should marijana be totally legalized. He discusses it here with a representative from Nazdaq, below.
“Everything suggests that a Biden administration will federally legalize cannabis,” said John Ramsay, CEO of Infinite CBD, a Colorado-based cannabis company. “If this happens, it is going to create more multistate operators, broaden the cannabis industry, create more jobs, generate more taxes, offer more products, produce more incomes in lower income sectors, and undoubtedly cause a spike in the value of cannabis stocks.”
Time will tell!