USDA publishes hemp production rule protecting interstate commerce

New regulations for hemp production, including protection for commercial motor vehicle drivers hauling hemp or hemp products, go into effect on Halloween.

The U.S. Department of Agriculture created the regulatory framework because Congress passed a farm bill in December that made a distinction between hemp and the illegal drug marijuana.

The interim final rule on hemp production goes into effect immediately upon being published in the Federal Register, which is scheduled for Oct. 31. There will be a 60-day comment period that starts on the last day of October, but the interim rule still goes into effect immediately.

After the comment period ends, USDA will publish final rules on hemp production within two years after the date of publication of the interim rule.

This codifies protection for drivers hauling cargos or hemp or hemp products.

“Nothing in this rule prohibits the interstate commerce of hemp. No state or Indian tribe may prohibit the transportation or shipment of hemp produced in accordance (with this rule),” reads the interim final rule.

While states and tribes may put into place stricter hemp production regulations than those laid out by the USDA, they may not pre-empt federal regulations with less restrictive ones. States may prohibit hemp production and processing within their boundaries but not interstate commerce.

Too late for some

This codification comes too late for some drivers, including Denis Palamarchuk, who agreed to a plea deal in September to for driving a tractor-trailer with a load of what he understood to be hemp. Instead of drug trafficking, he pleaded guilty to having an improperly permitted load. He was fined $1,000 ($500 suspended), charged restitution of $1,860, and put on one-year probation.

Prosecutors in Ada County, Idaho, argued that the farm bill’s decriminalization of hemp did not go into effect until USDA published its hemp production regulations, so hemp was still illegal when Palamarchuk was arrested.  Prosecutors held to the argument even though the USDA counsel issued an opinion in late May that interstate commerce of hemp was protected.

Also, the U.S. Postal Service in June issued a statement that hemp products are legal to mail under certain circumstances because the crop was no longer a federally controlled substance.

Dampening hemp industry growth

Despite protection for interstate hemp commerce, the USDA hemp rules may dampen enthusiasm for hemp production.

While the farm bill narrowly defined hemp as having no more than 0.3% of one type of tetrahydrocannabinol (THC). It is the amount of delta 9 THC that distinguishes hemp from marijuana. There are other THC compounds in the plant, though, that if heated can turn into delta 9 THC. USDA testing requires the total THC to be measured.

What’s more, it requires labs for compliance testing to be registered by the Drug Enforcement Administration. That likely will be a bottleneck to hemp production.

In support of the hemp industry’s growth, the new rule will make crop loans, crop insurance and disaster assistance possible for hemp producers.

In an Oct. 29 all-in news conference, USDA Under Secretary Greg Ibach said there were about 120,000 acres in hemp production in 2018 but more than 500,000 is estimated to be in 2019 production.