MONTPELIER, Vt. – (May 23, 2016) –  Federal law prohibits hemp production without permission from the feds. Growers in Vermont are doing it anyway – in increasingly large numbers.

Vermont provides a textbook example of how removing layers of law at the state level can effectively nullify federal prohibition of hemp. In 2013, the Vermont legislature passed a law legalizing and licensing hemp production at the state level. As the third growing season since state legalization gets underway, Vermont Public Radio reports a significant increase in acreage devoted to the crop, as well as new products set to come into the market.

“A survey conducted by this reporter of hemp growers registered with the Agency of Agriculture indicates that around 60 acres of industrial hemp are being planted this year, dwarfing the acreage previously cultivated in Vermont…This year, hemp is being farmed in more than a dozen locations around Vermont, from the Canadian border to the Massachusetts state line.”

This despite ongoing federal prohibition.

When Gov. Peter Shumlin signed the Vermont hemp bill, he emphasized that cultivation was still illegal under federal law.

“Although the growing of hemp will now be legal under Vermont law, it remains subject to federal anti-drug statutes. That means that farmers who choose to grow hemp do so at their own risk and need to be aware of the possible consequences”

The minimal possibility of federal prosecution has not stopped some growers from taking advantage of the opportunities they see with the door now cracked open to develop a hemp market in the state.

A company called Green Mountain CBD plans to grow five acres of hemp for the cannabidiol. Research indicates it helps prevent epileptic seizures and arthritis pain. Company CEO Alejandro Bergad said he has been breeding seeds in Hardwick Vt. This is an extremely important first step in developing a domestic hemp industry because the federal government tightly controls hemp seeds, make them difficult to come by. Creating local seed sources will allow the market to rapidly expand.

“There seems to be some kind of gold rush around CBD oil,” Bergad told VPR. “It actually does help people and I think a lot of people are trying as hard as they can to capitalize on that. We see ourselves as a small business. Our genetics and our breeding program allow us to sort of sell the picks and the shovels for the gold rush.”

Morgan Laurent plans on planting about 10 acres of hemp near the Canadian border. He also intends to make CBD oil. Last year, U.S. CBD sales were $65 million.

Other growers have their eyes on other developing markets for the plant. Hemp has upwards of 25,000 uses, including food, cosmetics, plastics and bio-fuel. The U.S. currently ranks as the world’s #1 importer of hemp fiber for various products, with China and Canada acting as the top two exporters in the world.

“Farmer John Williamson has been growing seed crops and making biodiesel there for more than 10 years and has an oil press and a de-huller. Williamson is joined by Robin Alberti, Ken Manfredi, who has grown a small hemp plot in Vermont during the past two years, and Doug Fine, the New Mexico-based goat farmer and hemp activist. Only an acre or two of the hemp grown in Shaftsbury will be used for CBD. The rest will likely be used for textiles and food. Williamson said he’s already in contact with a wool processor in upstate New York about the possibility of using the fiber from his hemp crop to make cloth.”

While 60 acres of hemp may not seem all that significant, It’s important to put things into a broader context. The federal government considers all of this illegal. Nevertheless,by simply removing a layer of law – state prohibition – and creating a structure to grow hemp, Vermont has kick-started an industry that will undoubtedly continue to grow. As more growers see the economic opportunities in hemp farming, they will take the plunge. This will grow the market further and make federal interference less and less likely. In turn, it will encourage even more investment, creating something of an economic feedback loop.

The evolution of the hemp program in Vermont demonstrates a practical reality. Tenth Amendment Center executive director Michael Boldin pointed out when states pass bills that remove a layer of law, markets will inevitably begin to develop.

“As those markets take root, legislators start feeling the pressure to relax laws further,” he said. “Some critics complain that state licensing programs ‘restrict freedom.’ Still, state-restricted hemp farming is better than no hemp farming at all. That’s at least a little more freedom. And as we’re seeing in Vermont and other states, it ultimately opens the door to even freer markets down the road. A little freedom begets more freedom.”

FEDERAL FARM BILL

Early in 2014, President Barack Obama signed a new farm bill into law, which included a provision allowing a handful of states to begin limited research programs growing hemp. The “hemp amendment”

…allows State Agriculture Departments, colleges and universities to grow hemp, defined as the non-drug oil-seed and fiber varieties of Cannabis, for academic or agricultural research purposes, but it applies only to states where industrial hemp farming is already legal under state law.

In short, current federal law authorizes the farming of hemp – by research institutions only, for research only. Farming for commercial purposes by individuals and businesses remains prohibited. Vermont law ignores federal prohibition and authorizes commercial farming and production anyway.

OTHER STATES

Vermont joins with a number of other states – including Colorado, Oregon, South Carolina, Connecticut, Maine and North Dakota – simply ignoring federal prohibition and legalizing industrial hemp production within their state borders.

While prospective hemp growers still have to take federal law into consideration, by eliminating the state requirement for federal permission, state hemp legalization clears away a major obstacle to widespread commercial hemp farming within the borders of the state.

Farmers in SE Colorado started harvesting the plant in 2013, and farmers in Vermont began harvesting in 2014, effectively nullifying federal restrictions on such agricultural activities. On Feb. 2 of last year, the Oregon hemp industry officially opened for business and one week later, the first license went to a small non-profit group. As more people engage in hemp production and the market grows within these states, more people will become emboldened creating an exponential wave, ultimately nullifying the federal ban in effect.

 

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