Why the U.S. Cannabis Industry May Witness a $20 Billion Boom
The House of Representatives approved the $867 billion farm bill in a 369-47 landslide Wednesday, after the Senate approved it 87-13 on Tuesday, sending it to President Trump’s desk for signature. Much of the bill is business as usual for the Agriculture Department, but the most notable change is its legalization of hemp, paving the way for the cannabis industry to explode.
The farm bill would make industrial hemp a lawful agricultural commodity, CNBC reports. The hemp legislation introduced by Senate Majority Leader Mitch McConnell of Kentucky earlier this year would allow states to become the primary regulators of hemp cultivation, enable researchers to apply for federal grants and make hemp eligible for crop insurance. With that, the U.S. cannabis industry could grow to $20 billion by 2022 from $800 million this year.
“At a time when farm income is down and growers are struggling, industrial hemp is a bright spot of agriculture’s future,” McConnell told Roll Call. “My provision in the farm bill will not only legalize domestic hemp, but it will also allow state departments of agriculture to be responsible for its oversight.”
“For too long, the outrageous and outdated ban on growing hemp has hamstrung farmers in Oregon and across the country,” Oregon Sen. Ron Wyden, the lead Democratic supporter of the hemp legislation, told Roll Call. “Hemp products are made in America, sold in America, and consumed in America. Now, hemp will be able to be legally grown in America, to the economic benefit of consumers and farmers in Oregon and nationwide.”
Cannabidiol, also known as CBD, is a cannabis compound derived from hemp that does not produce a high. Though there isn’t a great deal of scientific evidence yet, CBD has become popular for treating conditions such as anxiety and chronic pain. As early as mid-December, the U.S. Drug Enforcement Agency is expected to remove CBD from its Schedule I list of controlled substances.
House Republicans had been pushing for new work requirements for some Supplemental Nutrition Assistance Program (SNAP) beneficiaries, but those changes did not make it into the final version of the bill. About 80% of the $867 billion goes towards food stamps for low-income people; it also funds subsidies and crop insurance for farmers. While Congress was fighting over potential cuts to SNAP, the previous farm bill expired Sept. 30.
The new farm bill also provides permanent funding for farmers markets and local food programs, the Washington Post reports. Congress had been funding such projects on a temporary basis for five years at a time. These include promotional funds for local farmers markets, a research fund for organic farming, and money for organizations working to train the next generation of farmers. The farm bill also provides permanent funding for veteran and minority farmers.