Navigating through the 2021 USDA Hemp Regulations

The hemp industry finally has guidance from the federal level! It was a tossup which federal agency would reveal their hemp guidance first: FDA or USDA. The USDA took the win! The USDA released their hemp production final rule, mid-January 2021 but will not go into effect until March 22, 2021. To some this is a relief and to others, not so much. Leading up to the release of their final rule, hemp companies had close to zero compliance guidance, other than the plant should not to exceed 0.3% THC. It was up to the individual company to adopt their own compliance standards, or up to the state to create, apply, and hold the industry accountable for safety and quality of their products. Here are few of the main topics of discussion with the USDA Final Hemp Rule.

NOTE: The USDA Final Hemp Rule applies to hemp farms/cultivations. Manufacturing facilities will be under the authority of the FDA or state specific regulations.

USDA vs. State/Tribal Jurisdictions Approved Plans

The USDA set of regulations are heavily dependent on if your state/tribal jurisdiction has an approved hemp plan. States with a hemp plan that has been approved by the USDA will follow their individual hemp plan rather than the USDA guidance. Since the interim final rules differ from the final rule, USDA may require states/tribes to revise their approved plan to align with the updated set of regulations. The final rule allows states to continue to produce under the 2014 Farm Bill until January 1, 2022 which allows states/tribal jurisdictions to edit their plans. USDA will list the status of each state or tribe under the following categories: drafting a plan for USDA review, under review, pending resubmission, approved, or USDA Hemp Producer License. Click here to see the status of your local hemp plan.

USDA Sampling & Testing Requirements

Hemp companies may sample and test throughout the growing cycle; however, a designated sampling agent must be used when submitting the sample results to the USDA. USDA requires that only designated sampling agents, such as Federal, State, or Tribal Law enforcement agency or other Designated Person may collect hemp samples for the purpose of testing THC levels. This may help with consistency of sampling. USDA has developed sampling guidance, which can be found here. Similar to marijuana sampling, hemp shall be a representative sample that represent homogenous sample of the lot, include the flower portion of the plant, and collect enough to ensure confidence 95% that no more than 1% of the plants in the lot exceed 0.3% total THC. Take a look at your local approved plan for testing categories of fiber/grain hemp & consumable hemp, testing requirements may be different.

USDA Total THC & Accountability

THC testing is and will be a contentious topic for hemp producers. USDA’s final rule maintains total THC limit not to exceed 0.3%. Producers may choose to remediate or dispose of hemp that exceeds 0.3%THC, but what is the accountability of the producer when hemp exceeds total THC limit? Good news, USDA increased the negligent threshold from 0.5% in the interim rules to 1%. “Negligent” is defined as a failure to exercise the level of care that a reasonably prudent person would exercise in complying with the regulation. Examples of negligent violations include failure to provide a legal description of the land, not obtaining proper licensing, and producing hemp plants exceeding acceptable THC level. In the final rule, producers may only receive one negligent violation per growing season. Further, a producer who has deemed to make negligently violations three times in a five-year period will be ineligible to produce hemp for a period of five years.

Exceeding THC? Remediation or Disposal as Corrective Action

“Hemp exceeding the acceptable THC level may not be further handled, processed, or enter the stream of commerce”. What options do producers have under the USDA plan? If hemp exceeds 0.3% total THC, producers may remediate or dispose. The USDA allows producers to remediate via 1. disposing of flower material and salvaging the remainder of the plant or 2. blending the entire plant into biomass plant material. If either remediation activity is chosen, expect to provide a passing test result and document/report to the USDA. Either method of remediation may help minimize loss.

USDA’s accepted disposal methods align with sustainability practices. Under the USDA plan, there are many appropriate methods of onsite disposal. USDA approved disposal methods to include plowing, composting, tiling, disking, burial, burning, and bush mower. This is a significant sustainability win for the hemp industry compared to marijuana disposal methods which can be costly and not so environmentally friendly. Similar to remediation, producers must heavily document and report disposal of plant material.

Required Documentation & Reporting

The USDA did not disappoint with their long list of required documentation and submission of various reports. Afterall, it was to be expected. Such reports include producer report, criminal history report, testing, disposal, remediation, annual report, and the list goes on. Each report has specific requirements, submission deadline, etc. Although the USDA requires specific documentation, each approved state/tribal plan may require additional reporting conditions. Don’t be late with submitting these reports, it may be considered a negligent violation.

Contact Allay Consulting to learn more about the USDA & State/Tribal Approved Plans!