State of the States: Hemp
As the PanXchange hemp pricing hubs demonstrate, a number of states are leading the development of industrial hemp production and processing. Colorado and Oregon were two of the first to liberalize rules on cannabis and hemp, and have thus had more time for capital investment, legislation development, and pilot programs.
Kentucky and Tennessee, two major tobacco producing states, had significant help from politicians aiming to ease the pain from decreased tobacco use and lower prices.
These four states have become major hubs for hemp trading and investment in the hemp industry and areas we will be reporting on regularly.
There are still a few states lagging behind on passing legislation for hemp cultivation, and bills in those remaining states are too far from passing to allow for outdoor cultivation for the 2019 growing season. Below is a list of status on states that have yet to pass legislation.
Oklahoma: On April 20th, the Oklahoma Gov. Kevin Stitt signed legislation establishing guidelines for commercial production of hemp.
Iowa: Lawmakers are expected to pass legislation this week that would allow farmers to grow up to 40 acres starting in the 2020 crop year.
Texas: Yesterday, the Texas House gave broad preliminary approval to a bill to allow industrial hemp cultivation. Previous efforts to pass legislation had failed.
Nebraska: On April 16th, the Nebraska Legislature passed a first-round approval to a bill that would legalize industrial hemp production. This legislation will likely not pass in time for 2019 year crop.
Idaho: The Idaho Senate passed a bill but it was stopped up in the House, and legislation is likely dead for the year. Another bill to clarify out of state transportation was introduced earlier this month. Idaho is a major state for legislation as it is in between two of the major hubs, Colorado and Oregon, making transportation risky.
Ohio: The Ohio Senate passed a bill legalizing hemp and CBD after recent crackdowns, but it remains to be signed into law.
Louisiana: In March, a lawmaker proposed a hemp legislation bill, but nothing seems to be moving quickly.
Georgia: A bill passed both the Senate and House and has been sent to the governor’s desk for signing.
States moving slowly will most likely not be able to catch up with the leaders in the industry for capital invested in industrial processing facilities, but could become players in the cultivation space.
With farm income at decade lows, and adjusted farm debt near record highs, it seems foolish that state governments are hindering progress in an alternative cash crop that would ease pressure on other crop prices weak from trade wars and supply gluts.
USDA Guidance Allows Importation of Hemp Seeds
The USDA issued guidance on April 18th to allow for the import of hemp seeds for industrial cultivation after U.S. producers and foreign exporters reported numerous times that the DEA was holding up cargo at the border.
The USDA rule requires imported seeds to have a phytosanitary certification to verify the origin of the seeds and confirmation that no plant pests are present.
A major challenge currently in the hemp industry is farmers ensuring that they can acquire seeds with correct genetics for high CBD content with THC below the federal level of 0.3%. Foreign seeds from reputable companies will help.
While the main boom for hemp producers in the near term will be for CBD distillation, the plant has many other uses we’ve explored in previous editions of Hot Commodities. A Kentucky company announced they are opening a HempWood facility in Kentucky.
The company said that the idea of creating lumber from hemp fiber originated working on the floor of a facility creating flooring from bamboo fiber, saying that “HempWood will be available in block, board, flooring, and finished products such as cutting boards & skateboards at prices lower than oak.”
This factory should be an interesting use case for non-CBD hemp products, and should give some evidence to claims of the plant being a wonder crop for solutions to solving Global Warming to fixing plastics in the ocean.
CBD talk is hitting full mainstream. CBD products are popping up everywhere, with Walgreens and Vitamin Shoppe carrying to product in thousands of stores, services delivering product directly to your door, and Carl’s Junior putting it on burgers in Colorado. Network morning shows are devoting hour long segments to the products, claims, and downsides. America is in full CBD mania mode.
Could a bubble be on the way?
JP Morgan to Widen Use of Blockchain System
JPMorgan Chase & Co JPM plans to expand its current blockchain system for compliance to include payment transfer settlement, aiming to defend cross-border payment systems from competitors like TransferWise, Revolut, and Ripple.
Over 220 banks have signed up for the original service which allows sharing of information on payment transfers so errors can be corrected quickly. With a strong bank network already within the ecosystem, JP Morgan is well poised to expand to the payment transfer and settlement system. But with this system being a permissioned blockchain run by one of the largest banks in the world, is this really at the heart of decentralized technology empowering the masses?
Last month, a report found that JP Morgan topped companies for the most blockchain hiring openings. The bank is going all in with blockchain.
Image sourced from Pixabay
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