As an increasing number of states across the U.S. are becoming marijuana-friendly, many states are simultaneously attempting to enact more restrictive laws with respect to hemp-derived cannabinoids. Participants in the federally legal hemp industry are already required to navigate a complex web of federal and state laws. However, in light of changes that have occurred and will continue to occur throughout 2024, hemp businesses must be prepared to pivot on a moment’s notice throughout the coming months.
Current Legal Status of Hemp
The Agriculture Improvement Act of 2018, better known as the 2018 Farm Bill, signed into law in late December 2018, removed “hemp” – defined[1] as cannabis (Cannabis sativa L.) and derivatives of cannabis with “extremely low concentrations of the psychoactive compound delta-9-tetrahydrocannabinol”[2] (no more than 0.3 percent delta-9 THC on a dry weight basis) – from the definition of marijuana in the Controlled Substances Act (CSA). Prior to the enactment of the 2018 Farm Bill, the CSA did not differentiate between marijuana and hemp, and all cannabis (with certain exceptions) was a Schedule I substance and, therefore, controlled by the Drug Enforcement Administration (DEA). By carving “hemp” out from the definition of “marihuana” – the Schedule I controlled substance – Congress effectively legalized the cultivation and sale of hemp (as well as “all” of its “derivatives, extracts, cannabinoids, isomers, acids,” and more) at the federal level.
This definitional change to hemp arguably created what some consider a “loophole” for the sale of products containing potentially intoxicating cannabinoids other than delta-9 THC, such as delta-8 THC and tetrahydrocannabinolic acid (THCA). (We previously wrote about THCA’s status as a high-risk cannabinoid from a legal standpoint resulting from changes to state laws that were enacted throughout 2023. This article provides information regarding changes to state and federal laws that have occurred and are likely to continue to occur in 2024, which may affect many hemp-derived cannabinoids.)
Since this definitional change was enacted in 2018, the market for hemp-derived (or non-delta-9 THC) cannabinoids within states has soared, including for intoxicating hemp products. Forbes reports that sales of products containing delta-8 THC generated over $2 billion in revenue in 2021 and 2022.[3] A federally funded study published in December 2023 found that, among people who used cannabis in the past year, those living in states that still do not have legal marijuana markets were more than twice as likely to have used delta-8 THC.[4] As the report summarized, “[h]igher Δ8-THC use in states without medical or adult-use cannabis laws suggests that cannabis prohibition may unintentionally promote Δ8-THC use.”[5]
In 2023, the federal government was expected to release the new 2023 Farm Bill, which many state lawmakers anticipated would address – and potentially resolve – the “loophole” with respect to psychoactive hemp products created by the 2018 Farm Bill. However, in November 2023, President Biden extended the 2018 Farm Bill through September 30, 2024.