PanXchange® Hemp: Benchmarks & Analysis – April 2019

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PanXchange® Hemp: Benchmarks & Analysis – April 2019

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FDA Meeting Updates

One of the most important developing stories for the hemp industry is what role, and to what extent, the Federal Drug Administration (FDA) will play in regulating the CBD industry going forward.  Earlier this month it was announced that the FDA will hold its first hearing on May 31st, at the FDA White Oak Campus in Maryland, to begin discussing the legality of CBD in food and drinks.   The FDA has made it clear that it is in an informational stage and has concurrently opened an official docket to take feedback on the issue.  The FDA is seeking scientific data and information to assess the safety, manufacturing process and marketing of cannabis products and encourages commenters to avoid consumer success stories.  The first major deadline for those interested in making oral presentations at the hearing is May 10th, however, comments can be sent in to the FDA through July 2nd.  

The complete statement can be viewed by clicking here, however, there are a few major takeaways from the document.  First, it is extremely unlikely that the CBD industry will come to a grinding halt upon conclusion of the first hearing, rather, the FDA is going to implement regulations as part of an incremental process.  According to officials close to the project, the goal is to have regulations in place for the 2020 growing season and expects that at the earliest date regulations could come to fruition is by the fall of 2019.  In addition to gathering information through the public hearing, the FDA is creating a working group to “explore potential pathways for dietary supplements and/or conventional foods containing CBD to be lawfully marketed.”  Principal Deputy Commissioner Amy Abernathy and Principal Associate Commissioner for Policy Lowell Schiller have been asked to co-chair the group which is set to begin distributing findings as early as this summer. Lastly, the FDA has held firm on the topic that companies making false or unproven statements about CBD curing and or limiting certain diseases such as cancer, autoimmune diseases, and opioid use disorder that have not been approved by the FDA.  The FDA is serious about protecting consumers from making uninformed decisions or foregoing medical advice due to unsubstantiated claims. To this point, the FDA has issued several warning letters to companies that have made such claims.

Hemp Seed Imports

The U.S. Department of Agriculture (USDA) has formally announced that farmers can import hemp seeds, for the purpose of domestic cultivation, without legal repercussions.  Although the 2018 Farm Bill removed hemp seeds from the Drug Enforcement Administration (DEA) controlled substances list, there has been no shortage of confusion as farmers in states such as Montana have had troubles importing seeds due to DEA interference.  The USDA has provided more clarity to the issue by stating that the importation of seeds falls under the regulation of the USDA, not the DEA, and one of the purposes of the USDA is to “regulates the importation of all seeds for plating to ensure safe agricultural trade.”  

Further, the USDA has outlined hemp seed import procedures as well.  If the seeds are coming from Canada, either a phytosanitary certification from Canada’s national plant protection organization or a Federal Seed Analysis Certificate is needed to ensure no plant pests are detected.  If hemp seeds are coming from countries other than Canada, a phytosanitary certificate from the exporting country’s national plant protection organization is necessary to prove that no pests are present and verify the origin of the seed.  Lastly, the industry was notified that hemp seed imports are subject to inspection by the Customs and Border Protection, at the first port of entry, to ensure the above USDA regulations are met.

The importance of this announcement is not only relevant from an efficiency and economic standpoint; however, this is one of the first major announcements pertaining to how the United States will fit in to the global hemp economy.  Specifically, regarding Canadian origin seeds, farmers within the U.S. now have access to an additional source of quality seed stock originating from a market that has over twenty years’ experience growing industrial hemp.