‘Prohibition is over;’ Va. farmers see hemp grown for CBD as major cash crop

Virginia farmers haven’t had much to smile about recently. Trade wars sent crop prices plummeting. Dairy farms closed at a rate of more than one a week. The weather has sucked.

But legislation passed by the General Assembly and signed by the governor last month offers a rare recent win for the industry: It’s now legal to cultivate hemp for CBD, a component of the plant that’s in high demand as a natural but largely untested remedy for everything from anxiety to seizures.

“It couldn’t have come at a better time,” says Robert Mills Jr., a Pittsylvania County tobacco and chicken farmer who says he’ll plant six acres of hemp this season, a number he expects to grow to as much as 30 in the next five years.

“Hemp has brought some much-needed excitement back to the industry.”

CBD, short for cannabidiol, is a non-intoxicating compound that can be extracted from hemp and marijuana. It’s been available to consumers for years, but it hasn’t exactly been legal to sell and it definitely hasn’t been legal to produce in Virginia, where hemp farming has been limited to a research program that prohibited CBD production.

The state’s new law matches language in the 2018 federal farm bill and allows anyone to grow the crop and extract whatever they want from it as long as they haven’t been convicted of a felony drug offense in the last 10 years, pay a $50 fee, provide the GPS coordinates for their fields and submit to testing to ensure their product doesn’t contain more than .3 percent THC, the part of the plant that gets people high.

The law is effective immediately because the General Assembly moved it as an emergency measure, just in time for this year’s growing season.

“We are out of the gray area,” says Sam Johnston, the legal adviser to the Virginia Industrial Hemp Coalition. “Prohibition is over.”

A boon for tobacco farmers, with some risks

The financial implications are huge, especially for southern Virginia farmers already cultivating tobacco, which requires much of the same infrastructure (curing barns, anyone?) and soil conditions as hemp.

Mills, who sits on the Virginia Farm Bureau’s board of directors, says he can net anywhere from $4,000 to $20,000 per acre of hemp he grows, compared to $800 to $1,000 he could expect from tobacco, which is among the crops hurt in ongoing trade disputes with China, Russia and Turkey.

He’s not alone. The state agriculture department says 360 growers have registered, representing approximately 4,000 acres. Another 100 registrations are still under review. That’s approaching about a quarter of the roughly 20,000 acres of tobacco Virginia farmers harvested last year.

“It’s a pretty rapid increase in acres,” says Kevin Schmidt, the department’s director of policy, planning and research.

The investment comes with significant risk. Mills noted that no crop insurance is available yet but the investment per-acre is huge — about $20,000.

Other potential problems include uncertain demand as supply grows. Farmers also have to mind the .3 percent cap on THC content, which, if exceeded, could result in the state forcing the farmer to destroy the entire crop. (It would only be a violation of drug laws governing marijuana if the farmer grows a crop with too much THC “with a culpable mental state greater than negligence.”)

Mills says he and others guard against that by testing their plants weekly and harvesting only when the THC content hits .25 percent.

Demand driven entirely by CBD

While hemp is valuable as a fiber and food product, too, industry leaders say demand so far has been driven almost entirely by CBD production.

Federal laws and regulations governing the sale and marketing of CBD remain a bit murky, particularly as far as the U.S. Food and Drug Administration is concerned. While CBD extracts, oils and capsules are commonly sold and used in ways that resemble dietary supplements, the FDA prohibits them from being labeled as such or included in food products.

There’s also debate about whether hemp-derived CBD is listed as a controlled substance at the federal level, but producers argue that the recent de-scheduling of hemp (which by definition is any cannabis plant with a THC content of less than .3 percent) means as long as the CBD came from hemp, it’s legal.

However, the lack of any law enforcement action around the subject makes the question moot to the point where risk-averse major chains like CVS and Walgreens have begun carrying the products in some of their stores.

Medical marijuana industry raises safety concerns

Advocates for the state’s burgeoning medical marijuana industry, which will soon begin providing THC and CBD medicines to patients under strict state scrutiny, have also raised questions about the safety of over-the-counter CBD products. During the legislative session they urged lawmakers to hold off on approving a law that would allow hemp to be grown for CBD extraction.

“For the safety of patients, CBD intended for medical use needs to go through a rigorous testing process,” said Adam Goers, the chair of the Virginia Medical Cannabis Coalition and an executive at Columbia Care, which won the state’s license to sell medical cannabis products in the Hampton Roads area.

“I think the products themselves right now, if there’s a label on there, there’s no guarantee it is correct, and we think that’s an important thing to note.”

It’s not an abstract concern. Researchers at Virginia Commonwealth University tested nine commercially available CBD vape products and found one contained DXM, the active ingredient in cough syrups, and another four contained synthetic cannabinoids that are the active ingredients in “Spice” and other intoxicating mixtures that have been linked to overdoses.

Hemp industry advocates acknowledge there have been issues, but say the market can self-regulate and is in the process of developing their own certification and testing programs.

“The safety concerns that have been raised about hemp extracts are valid, but overblown,” said Johnston, with the hemp coalition. “By and large the hemp industry is operating responsibly.”

He argues the two industries shouldn’t be seen as at odds with one another, with the pharmaceutical providers selling to patients with doctor-diagnosed medical needs and the hemp industry providing wellness products that meet a broader demand.

In either case, he notes lawmakers rejected legislation to limit hemp CBD production. “The genie’s out of the bottle,” he said.