Big changes coming for the legal hemp industry 👀

FARM BILL
New Farm Bill text reigns in intoxicating hemp

Driving the news: The cannabis and legal hemp industries have awaited the new version of the Farm Bill with bated breath.

On Monday, Sen. Debbie Stabenow (D-MI) released the full text of the new version of the bill, which would amend the definition of “legal THC” to include THCA, the naturally occurring acid form of THC. (THCA, once heated, is converted into the chemical THC that makes you “high”). 

The move would ban most intoxicating hemp products, legal under the current Farm Bill, but still allow hemp products to contain minimal amounts of THC. 

What’s next: Stabenow chairs the Senate Agriculture Committee. It’s not yet clear whether the new version of the bill will get a vote during this year’s lame-duck Congressional session. 

Back up for a second: The last Farm Bill, passed in 2018, created a loophole to market products containing THC — the chief psychoactive compound of the cannabis plant — in all 50 states, though some, like California, have begun to crack down by banning intoxicating hemp products. (What some call “loophole,” others call “opportunity,” but I digress). 

Hemp and cannabis are the same plant biologically, but hemp is legally defined as cannabis that contains less than 0.3% delta-9 THC, per the Farm Bill. 

Companies have gotten around the federal ban on THC by creating products with THCA synthesized from hemp which are technically allowed under the current legislation. 

Lawmakers have proposed various strategies to shut down the loophole but have come under fire from the hemp industry, which says that fully closing it would destroy their sales and force them to lay off employees and potentially shutter their businesses. 

Hemp vs weed: Some cannabis companies have advocated for closing the loophole outright, as they say that the intoxicating hemp sellers violate the spirit of the law, and that it’s unfair that they are subject to onerous regulations and heavy taxation, including 280E — which bars them from deducting business expenses — that hemp sellers are not, even though to most consumers the products are effectively the same. 

It’s also pitted the two industries against each other, as some hemp companies donated to Florida Gov. Ron DeSantis’ campaign to defeat legalization in Florida. 

The new version of the bill, if passed, would keep the 0.3% threshold but amend the definition to all THC. Even non-intoxicating hemp products can end up containing slightly more than 0.3% THC — called ‘hot’ hemp in the industry — given that it’s a natural product and hard to control the specific chemical compounds in the growing and cultivation process.

But, but, but: The Senate version of the Farm Bill doesn’t go as far as the House version, which would lower the threshold for allowable THC to 0, in an amendment proposed by Rep. Mary Miller (R-IL).

Other bills have been proposed to further regulate the hemp industry as well, including the Cannabinoid Safety and Regulation Act proposed by Sen. Ron Wyden (D-OR).

And more: Jim Higdon, the CEO of Cornbread Hemp, joined Cultivated Live last week to discuss how hemp companies are thinking about the new Farm Bill and federal cannabis reform. You can watch that here. 

-JB

“Sometimes it takes an unpleasant person to get something radical done,” Curaleaf CEO Boris Jordan told Politico, in a story about why the cannabis industry is one of the few groups excited about President-elect Donald Trump nominating former Florida Rep. Matt Gaetz to lead the Department of Justice. 

Gaetz has been a strong supporter of cannabis reform legislation in Congress, though he voted “no” on the failed bid to legalize pot in Florida. 

Read it. 

SAFER Banking again? 🇺🇸

Stop us if you’ve heard this before — some lawmakers, including Republican cosponsor Sen. Steve Daines say, they want to pass the SAFER Banking Act, a bill that would normalize the cannabis industry’s relationship to the financial system, before the end of the lame-duck period. Read more. 

Georgia expands medical cannabis industry 📈

Georgia is set to allow more medical cannabis dispensaries to open in the state after it hit the important milestone of registering 25,000 patients, The Telegraph reports. 

Cannabis legalization stalls in Pennsylvania 🥊

State lawmakers in Pennsylvania don’t seem to be following through on Gov. Josh Shapiro’s pledge to legalize cannabis. Though a bipartisan legalization bill was introduced, it doesn’t appear lawmakers will be taking it up before the end of the year, reports WVIA News. 

Millennials consume the most pre-rolls 🌿

Millennials buy the most pre-rolled joints — they account for 45% of the $3 billion market, according to a new report from Custom Cones USA and Headset. Check out the full report on the pre-roll market here. 

Michigan cannabis prices continue to tumble 📉

Wholesale cannabis prices continue to slide in Michigan, dropping another 6% in October, according to new numbers from the state’s Cannabis Regulatory Agency. The average price for an ounce of dried cannabis is down 21% since the start of this year, at $73.99. Sales in the state dipped slightly too, at $282 million for the past month, but the industry is expecting a turnaround, reports Crain’s. 

Australia set to vote on legalization bill 🐨

Australia’s Parliament will vote later this month on a bill that would tax, regulate, and legalize the possession and consumption of cannabis for adults on November 27. If passed, the bill would establish a regulated cannabis market in the country, legalize growing cannabis at home, and establish the creation of cannabis cafes. Read more. 

Analyst expects radical cannabis reform ‘less likely’ in the next two years 👀

Financial analyst Pablo Zuanic says big federal cannabis reform like Rep. Nancy Mace’s STATES Act is less likely to happen in the next two years, given the Republican Party’s traditional “prohibitionist” stance on legalization. That’s despite Trump nominating pro-cannabis officials to crucial Cabinet posts, like Robert F. Kennedy Jr and Matt Gaetz. Read more. 

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Ontario sold more than $1 billion (CAD) worth of cannabis in the first half of 2024, according to a new report from the Ontario Cannabis Store. That equates to over 190 million grams of cannabis sold.

Below, you can see the top-selling brands in each category.

Cannabis and driving 🏎️

Far more Americans say driving while distracted by a cellphone is more dangerous than driving while intoxicated from cannabis, according to a new Pew poll. Seventy-eight percent of respondents say phones are a ‘major problem,’ compared to 37% for cannabis. Check out the full results.

Yesterday, Cory Azzalino, CEO of Eaze joined Cultivated Live to talk about the latest fundraise and restructuring plan for the company.

What Can We Expect From Trump On Cannabis Reform? | Forbes

Cannabis Musings | Substack