When the Farm Bill first passed in 2018, it was an historic moment for the hemp industry. CBD was finally legal and could now be widely available to customers. In years since, the industry has exploded. There are less misconceptions about CBD, and new innovations that continue to bring new products to the market. Since the Farm Bill expires every five years, it must be updated. This can bring up a lot of questions and concerns about the future of the hemp industry and what it means for customers and retailers.
Here are a few of the most important takeaways and potential ramifications of the update to the Farm bill, and how it might affect you.
Clearer Regulations
These regulations will help to distinguish between industrial grown hemp and cannabinoid-rich hemp. This means there will likely be a more precise legal framework when it comes to governing the production and distribution of CBD. Clearer regulatory guidelines will help CBD producers navigate the legalities more efficiently. It will reduce the risk of inadvertent noncompliance. Clarity for the win!
Potential for Market Expansion
One of the things the 2023 Farm Bill addresses is the “derivatives loophole,” where manufacturers chemically convert CBD to other substances, like Delta 8 THC. Although we’re fans of Delta 8 and use strict purity requirements, not every product that has made it to the market meets the same standards. Clearer definitions will likely make it easier for compliant CBD products to make it to the mainstream market. And with better defined rules in place, it will hopefully lead to deeper consumer trust, and even expand the customer base for CBD products.
Increased Oversight
Third-party testing has always been a tenant of business for Apex Labs CBD. Although we pride ourselves on the highest standards, those same standards aren’t universal in the industry. A new focus on visual inspections and framework to penalize bad actors should result in an increase in oversight. While this can help ensure quality and consistency in CBD products, it might also mean that CBD producers will need to be more vigilant in adhering to set guidelines.
Opportunity for Product Diversification
This is where the regulations that distinguish between industrial grown hemp and cannabinoid-rich hemp come into play again. As these are better defined, CBD producers might find new opportunities to diversify and expand into other hemp-derived products.
Challenges for Non-Compliant Producers
Companies that have benefited from the “derivatives loophole” or taken advantage of the gray area around regulations may have a harder time in the new regulatory environment. And those that don’t stick to the new guidelines might be stuck with legal challenges or even forced out of the market. That will only help elevate the CBD market as a whole.
Consumer Safety
This is a big one. The Cannabis Regulators Association has urging lawmakers to address hemp-derived cannabinoids to safeguard consumer health. If there are stricter quality and safety guidelines for CBD products, it could help boost consumer confidence in the industry, as well the overall reputation of CBD as a safer, more regulated product.
Broader Economic Impact
Some of the broader objectives of the 2023 Farm Bill include supporting agricultural producers and investing in rural communities. This hints at overall economic growth opportunities for the hemp and CBD industry. We could see producers benefiting from possible incentives, grants, and programs designed to bolster the hemp industry.
While we wait for the 2023 Farm Bill to be passed, there’s a lot to look forward to. The Farm Bill is set up to bring more structure and governance to the CBD industry. While this likely means a more regulated environment, it also offers more opportunities for growth, expansion, and greater consumer trust in the CBD market.