Why the USDA Testing Rules Will Hurt the Hemp Industry

On Tuesday, the U.S. Department of Agriculture (“USDA”) released its interim final rule for the production of hemp under the 2018 Farm Bill. Although these rules are not final, they will go into effect once published in the Federal Register, at which point a 60-day public comment period will begin.

Upon the publication of the rules, our firm provided a broad overview of the provisions found in the rules. Today, we further discuss the THC testing requirements proposed in the rules and how they will impact the hemp industry.

TOTAL THC TESTING PROTOCOL

To the disappointment of many in the hemp industry, the USDA adopted a total THC testing requirement. As we previously explained, total THC is the molar sum of delta-9 THC (“THC”) and delta-9 tetrahydrocannabinolic acid (“THCA”). Using a total THC testing protocol will create additional hurdles for hemp farmers who are already engaged in a precarious industry. Not only does this testing method tend to increase the THC concentration in the hemp sample, and thus, pushes it over the 0.3 percent limit, it also limits the type of strains farmers can work with. This is because few hemp genetics currently on the market would comply with a total THC testing method. Consequently, this rule will force hemp farmers to carefully select the types of seeds they buy.

To make things worse, the USDA rules also require that hemp be sampled and tested for total THC within 15 days of anticipated harvest. Given that the concentration of THC increases as harvest approaches, the rule will create additional challenges to get at or under the 0.3 percent limit. Although the USDA stated in its rules that it was “requesting comments and information regarding the 15-day sampling and harvest timeline,” the agency also explained that the rule “will yield the truest measurement of THC level at the point of harvest.” In light of these statements, it will be interesting to see whether stakeholders’ input on the matter will convince the USDA to revise this requirement.

DEA REGISTRATION

The USDA testing rules further require that the testing labs be registered with the Drug and Enforcement Administration (“DEA”). The rationale for this rule is that labs could potentially handle hemp that tests above the THC testing limit, and thus, would constitute “marijuana”, a Schedule I drug under the Controlled Substances Act. Because it is unlawful to possess marijuana without a DEA registration, all labs must be registered with the DEA in order to conduct hemp THC testing. However, the current DEA rules limit registration to labs located in jurisdictions in which the prescription, distribution, dispensing, research and handling of marijuana is legal. Accordingly, this USDA rule may reduce the number of labs that will be authorized to engage in this industry, which would be problematic given the fact that there are currently too few labs compared to the amount of hemp being produced.

Therefore, the proposed USDA rules present real challenges for the hemp industry as many crops will likely fail to meet the total THC limit and fewer labs will be allowed to test the crop.

If you would like to further discuss this issue, please contact our team of regulatory attorneys.