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Hemp reform in the United States is all but assured following the publication on Monday evening of the final text of the 2018 Farm Bill. The conference report – the version of the bill agreed upon by both houses of Congress – removes hemp and its derivatives from the Controlled Substances Act (CSA), and amends five other acts, opening the door for hemp to become a normal agricultural crop in the U.S.

The Senate voted overwhelmingly in support of the bill on Tuesday afternoon. It now moves to the House and Representatives for a vote, before the president can sign it into force. As hemp reform is only a small part of the 807-page document, which covers every aspect of U.S. farming, the passage of the bill appears certain in the coming days.

"There’s going to be an adjustment period… as many states are now going to have to pass legislation to give their state Department of Agriculture authority to write rules for hemp as an agricultural commodity,” said Joy Beckerman, president of the Hemp Industries Association, an industry lobby group.

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"But I think these are actually going to go very fast. There's already tremendous investment taking place, and this is just going to embolden people," she said.

The key changes contained in the Farm Bill were outlined by Jonathan Miller, general counsel for the U.S. Hemp Roundtable, in a note published online. Here are some of the takeaways:

  • Redefining hemp: The bill redefines hemp to include “extracts, cannabinoids and derivatives.” That means cannabidiol extracted from hemp (which must contain less than 0.3 per cent THC) will no longer be treated as an illegal substance. “This should give comfort to federally regulated institutions – banks, merchant services, credit card companies, e-commerce sites and advertising platforms – to conduct commerce with the hemp and hemp product industry,” wrote Mr. Miller.  
  • Interstate commerce: The bill leaves open the possibility that states or tribal governments will pass more restrictive laws around hemp or CBD. But it makes explicit that “no State or Indian Tribe shall prohibit the transportation or shipment of hemp or hemp products... through the State or the territory of the Indian Tribe.” 
  • Crop insurance: The bill amends the Federal Crop Insurance Act, giving hemp farmers access to reasonably-priced crop insurance. Other amendments allow hemp farmers to “fully participate in [US Department of Agriculture] programs for certification and competitive grants,” wrote Mr. Miller. 
  • FDA still regulates final products: While the The Drug Enforcement Administration will no longer oversee hemp-derived products like CBD, hemp derivatives are still subject to regulation from the The Food and Drug Administration. “While we are concerned about non-binding statements made by the FDA that have led some state and local officials to question the legality of the retail sale of hemp-derived CBD, we are hopeful that we can work with the agency to clarify that CBD... should not be withheld from Americans who count on it for their health and wellness,” Mr. Miller wrote. 

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